The sun. [volume] (New York [N.Y.]) 1833-1916, 1916-05-01
From Weak to strong Hands.


Therefore IT Is not surprising that
Wal street seemed to give evidence last
week OF the further transfer Of stocks
from weak to strong hands. In compar-
ison will the more unfavorable proba-
bilities which have been reflected OF late
the share list had in~ferentially been
placed IN an adequately lipu!dated posi-
ton which went far 10 discount. both in
the reduction OF the speculative long lc-
count and IN the fall Of quotations from
the maximum level ~ last year. the
worst events which seemed most likely
to happen. This was almost implicit in
the ia I that In the processes which had
been ~discounting the danger Of a change
in the country's status Of neutrality
toward the European war there had
clearly been a sufficient anticipation and
reflection OF other depressing matters,
Including the Mexican trouble, the prog
ress of prelimiuaries to the national po-
litical campaign. the disturbing state
~ the labor market and the extent 20
which the establishments involved In the
ending of the European war must nov
be- reckoned with.
So far as the nearby stock market ls
concerned 1t might also be pointed out
that all through the reaction from last
years extreme upswing there has been
4 remarkable and sustained demand for
investment securities. Such "A phenom--
non has usually been indispensable 10
any prolonged persistence OF profitable
activity In the field Of general business
where the real valuc Of corporate epui-
ties are fixed, and II has usually been
prophetic of such a period. According
20 the teachings OF experience and in
the light Of the remarkable business
prosperity which now exists the stock
market might he described as seeming
TO offer a speculative opportunity on an
investment basis. The measure OF tho
opportunity is the fact that values would
be quoted higher than they are but for
the various contingencies which have
restrained appreciation. These restraints
make for safety. and while the contin-
g~encies OF the whole situation with
which Wall Street has to deal may
check aggressive forward buying Of Sc
curities at advancing prices confident
absorption at concessions 10 all the more
likely to be encouraged.
However much the quoted improve
ment OF values may be limited either
by occurrence OF contingency there IL
no question about the country's bust
ness and banking strength TO cope with
all conceivable emergencies. Incentives
for investment confidence are supplied
by the record OF the past TWO years and
nm Ait'i ~ 80 WV e't'NN " az ~
market and in the wonderful expansion
OF trade and industrial profits. The
United States Steel Corporation pub
lished last Tuesday its return of earn
ings for the March quarter and this
great institution. so representative OF
big business and basic industry alike,
gave In is report the most impressive
testimony ye. furnished to the impulses
for prosperity OF which enterprise can
ox.atI ;tca1f ItrinD nd uffay TIM Etrn-
pean conflict.
Earnings In Quarter &0O,713.824.
The corporations net earnings for the
first three months OF this year aggre-
gated $50, 1884. surprising by about
$4,000, 900 the previous quarterly rec
ord total reported for the last three
months OF 1915. The largest quarterly
net earnings before the European wal
were the s45, o .705 reported for the
three months ended June 1907. Each
month OF the last quarter attained a
new monthly record Of earnings. the
progress being from $l7.677,0O0 in De-
cember to s22.722,3l6 in March. when
the earnings were at the rate OF more
than $272, 900. 900 n year.. compared with
the 1907 maximum OF about $751;
900. 900. As the hrst quarterly return
is likely to he inferior to succeeding ex-
hibits even more amazing figures nay
be expected from the Unprecedented to-
tai OF business on the books OF steel
makers and from the high level Of
prices al which deliveries are being
made. In the six months ended with
March the net steel earnings were about
Sll2.0oO, 000, or almost exactly the aver
age earnings for a full year since the
corporation was organized. The surplus
after all charges n dividends In the
March quarter was $32.sj4.l72. while the
average OF total quarterly net earnings
in the corporations history up to this
year is about Sos. 900, 900, Al the end
OF last year the corporation had more
than 800. 000. 900 cash in bank as part
OF its working capital. Al the end Of
this year the amount Is likely to be
more than doubled.
Altogether the Steel earnings supply a
striking illustration 1T what war influ-
ences have done 10 place enterprise In a