New Britain herald., 1916-12-23
Henry CZeu,s
 Weekly Letter
Especial to the Herald.)

tlrely by peace possibilities. The l frank desire of Germany for peace has been freely admitted; while the l unWlllingness of the Allies to grant | peace upon any terms which Ger | many would likely accept was equally recognized, and the possibility Of peace ] therefore appears to be still remote. MT. Wilson's attempt to hasten pro- ceedings by asking the belligerents to name their terms may prove to be of some influence, or it may not It is to be devoutly hoped that the presi- dent will be successful in this effort but the outcome cannot be foretold at this Writing. The secretary of state S outspoken statement about this coun- try's exposed condition brought to the front new situation which proved seriously confusing in the stock mar ket. The war stocks received sharp blow on belief that their extra ord- nary profits had reached their high point and must in future decline. if not altogether stop before many months expire. Inside selling, profit taking, forced liquidation, powerful bear raids, and discrimination by banks against such stocks as col lateral served to intensity the decline, which at times reached the point of positive demoralization. The situa- ton was further mystified by activities here on German account Among these was the announced preparations Of the two great German trans Atlantic steamship lines to resume service upon short notice, if necessary German exchange advanced sharply Wheat declined upon war develop ments; so likewise did cotton, copper, lead and certain other comm odities In short, the whole trend of both se- curity and commodity markets showed the beginning of a general movement to discount peace.
 The point of view regarding the war has completely changed All minds are now turned towards peace; hence the collapse and semi-panic in many of the industrials on the Stock Exchange. The decline, however, was chiefly the result of an overbought market, which induced fresh caution in banking circles, a sharp calling in of loans and forced liquidation of weakly margined accounts. The se- were fall in many shares would seem to be unreasonable and out of all pro- portion to changes in intrinsic con- d1tiOnS or values. Success on part of the bears made them exceedingly az gressive, and their raids resulted in shifting large amounts of stocks from weak into strong hands.
 Liquidation of stocks certainly re- ieved the money market, and the situation in this respect is much bet ter than when the Federal Reserve Board warning was issued several weeks ago. Reserves of clearing house banks should show considerable
 
 statement in consequence of con- traction of loans and gold imports Additional shipment of the precious metal amounting to s14,7OO,OOO ar rived this week from Canada, making total imports of $616,7OOOOO since January 1. Our banking and credit situation is generally sound and what ever caution may have been exercised by the banks has been for the purpose of restraining excessive speculation rather than from any lack of confi- dence in their own strength. The na- tional banks, it may be safely affirmed are in an exceedingly satisfactory position.
 The railroad outlook Is promising earnings both gross and net showing very encouraging gains. Traffic con- tinues heavy and the scarcity of cars llouSIl 1eSS dCule, IS SClll- an I'm Dedt- ment which cannot be effectualIv dealt with until the supply is in creased or traffic diminished. Of the latter there are no symptoms at present. Controversies over the Adam son bill and friction with labor are among the shadows under which rail- road managers are laboring. Never theless, the railroad outlook is bright CT than it has been for several years and the manner in which these shares have resisted recent weakness in the stock market proves the more favor able opinion in which they are now held.
 On Thursday the market made a sensational break and transa ctions amounted to over 3,O0O0OO shares Liquidation was greatly intensified by exhausted margins, and the heavy selling on Western account Presi- dent Wilson's note urging the bel1ig- erents to name their peace terms caused some uneasiness at first, but was subsequently, better received as it became evident that it would not provoke friction with any nations at war. Much more concern was felt over MT. Lansing's intimations that this country was drawing nearer to the verge Of war owing to the per- sistent interference of foreign powers with the rights of neutrals. The alarm which this caused had much to do with the semi-panic which occurred on Thursday afternoon, and the de- cline was only partly checked by the more assuring explanations which came from the sa me source later in the day. Whether the liquidation has run it's course or not is difficult to say at this writing. Some weak spots which successful bears may be tempt ed to uncover still remain. On the other hand the speculative situation has been greatly improved by the re- cent liquidation; there has been much