The sun. [volume] (New York [N.Y.]) 1833-1916, 1914-04-20
FINANCIAL REVIEW
OF THE PAST WEEK
Stocks Show Significant Weak
ness After Long Display
Of Firmness.
NEW Low LEVEL PRICES
Close Relation Between POliti-
cal Developments and
Fall Of Values.
NEW Low LEVEL PRICES

range Of prices and offered resistance to
news which was In the main unfavorabls
to values. Support was derived from the
cheapness Of money and from the per-
sistence of hopes natural to the Ameri-
can business and banking community. A
fortnight ago the market began to weaken
and in the last few days sold down to
q new low level for the year.
Regarding the stock market in It's baro-
metric function these indications are not
encouraging. Time and circumstance may
correct them but a good deal moro de-
pendence has to be placed on time and
circumstance than Is Immediately con-
ducive to financial optimism. The Gus
tomary significance of q downward de-
parture OF prices after 30 long a main
tenance OF higher level is that bearish
influences are controlling the trend Of
quoted values and that selling disposi-
tons are prevailing over inclnations to
make constructive engagements. II the
stock market has developed any bearish
trend in renewal Of the movement which
has asserted itself repeatedly in the last
five yeare AFTER moro or less extensive re-
coveries In stocks IL may be taken to
mean that general business improvement
is still a matter OF the further future
He would be prejudiced indeed who
would refuse to see any connection be-
tween the course OF the stock market
this month and the large factor OF poll
tics. The substantial rally which reached
its elimination in the latter part OF Janu-
airy and the early part OF February was
based on the widespread liquidation OF
financial and business positions both at
home and abroad In 1918. Under ordi-
nary conditions some recovery in Sc
curity quotations was bound 10 be pro-
NOTED by the great betterment which
liquidation effected In the money market.
Credit strain had been one OF the prime
causes OF liquidation and decline and
when this was relieved a recoil from de-
preston was inevitable.
There was more than this. however.
in the midwinter upturn in Wall Street.
That upturn was promoted very largely
by feeling Of cheerful assurance that
constructive forces were gaining the upper
hand politically and. with a whole new
year Of effort ahead. business confidence
was regained to . promising degree. To
careful observers at the time II was not
apparent that very tangible and definite
grounds had been politically vouchsafed
for this better feeling and It became evil
dent as the winter progressed and spring
advanced that American finance and
business had been cherishing decisions
about the consequences OF last years
OF politics for the future
1t Is quite clear to-day that political
effects have been standing in the way Of
trade and industrial Improvement. have
been working renewed impairment OF
confidence and are obstacles TO its
restoration. From the point OF view OF
the business man who must make his
calculations with chief regard to the op-
portunity to coin energy and endeavor
into dollars II Is becoming increasingly
clear that while our Governmental ar
fairs. foreign and domestic, are being ad-
ministered on a plane OF lofty idealism
II Is an idealism based on an absurd min
imum Of practical knowledge of the diff
ficulties OF economic enterprise. and worse
than that II has vast contempt for the
practical knowledge which business men
must have.
The recent departure OF the stock mar.
ket downward dates from the day when
the Federal reserve bank organization
committee published its gerrymander OF
the United States for the banking dis
tricts Of the new Federal reserve system
In the order of their occurrence there
were next these developments and con-
siderations accompanying the accelera ed
decline of quoted values The tokens that
the Interstate Commerce Commission
would probably postpone by n supplement
tary inquiry any positive decision in tho
Eastern rate case the proof OF reports
from business in general and from basic
Industry In particular. that the revised
tariff was making trouble which threat.
ened to compel an early reduction In
wage schedules In the steel trade; the
proclamation OF President Wilson's OBJ
stinate purpose to force his whole pro-
gramme of antitrust legislation through
Congress at the present session the pub
licatlon of the text of the remodollod
trades commission bill and the omnibus
0
measures Of the Administration for the
elaboration OF the Interstate commerce
acts and. finally. the extraordinary
manpuvring of Washington against the
Huorta Government in Mexico. which ex-
cited apprchcnsions that war would
evolve from the grotesque controversy
over the proper formalitles OF an apollo
getic salute to the flag.
Now II is possible to see in the FORE
going nothing but an amazing series OF
condolences between the lapse OF the
stock market into weakness and the cata-
logue OF contemporary political events
Nobody who has been In close touch with
the financial and business situation can
fail to believe that there IL something
more than Il mere chronological relation
The sequence denoted is too obviously one
OF cause and effect. Just as the attempt
to recognize more suspicious omens in
politics helped to promote the midwnter
Improvement In the stock market with
the subsequent bulge In general bus,
ness. so II has been disappointment on
political account which has broken down
stock market resistance no long offered
to adverse happenings in political and
other fields.
Thanks to the fundamental soundness
OF financial and business positions, more
or less extensively resulting from the cor.
receive processes applied last year to n
widespread economic malad justment
there Ia warrant for assuming that pos
sibllities Of further liquidation and con.
traction in financial and business values
and volumes are limited. There Ia also
support against the factor OF political de.
preston, support coming from the
money market situation and from the rea-
sonable prospect OF a satisfactory agricul-
tural outlook. Nevertheless. politics In
to-day making IL hard to hold n moderate
amount OF prosperity for the country and
making 1t harder yet TO inaugurate an
expansion OF prosperous activities
senator Lodge in the very able address
which he made recently on the subject
or the Panama Canal tolls took occa-
sion to discuss the question In terms of
a large application which ftts the difr-
cult situation that is confronting business
on account OF politics This statement
ny the senator deserves the widest cir
cula'lon which can he given to il:
Legislation Of late years has pro-
lad laaEtr