The Birmingham age-herald., 1917-03-04

ket when we begin to use the right name for it?"
 Tt would not surprise me at all if the first response to a declaration of war would be decline in prices. That would be a perfectly natural reflection of the seriousness of such step. But a down. ward price movement, in my opinion, would be only temporary. Tremendous expenditures will be made by this coun- try in preparation for war. and such ex penditures will bring about another pe- riod of industrial expansion. It is the business of the stock market to discount new conditions.
 T believe just as firmly as ever that we have ahead of us period of painful industrial readjustment; but before We get that, because of recent developments which none of us foresaw, we are going. to get another bull market in stocks, with prices very much higher"
 Walking down the trust company steps, it was realized that the foregoing con- clusions were based primarily on the the ory that war is going to last indefinitely.
 DURATION OF WAR
 How long will war last and what do you see ahead of us?" was asked the in- ternational banker Recognizing the ques- tion with a good morning the financer, without looking up from his rol-top desk, following an old habit when very much interested, reached for a pad and silently began drawing both straight and curved lines within a quickly sketched cir cle some three inches across. It was nearly minute of 50 full seconds be- fore the pad was thrown aside
 ''If the campaign of the allies this summer discloses unexpected strength and resources on the part of Germany her opponents, England and France and Russia and Italy, will get discour- aged and begin to ask, What's the use of keeping this up Under such conditions we will have peace before the end of this year. I believe how ever that exactly the opposite results will be obtained by the allies from their summer campaign. And when the English and French realize the Ger mans are breaking up, nothing on earth will be able to stop them from continuing the war to the bitter end That will mean. of course, that the end of the war is not row in sight"
 As to the stock market effect of a long drawn out conflict, with this country participating, the views of the private banker were the same as those of the trust company president Both men believe that because of the violent and thorough liquidation which loloWed Germanys cry for peace on De- cember 12. the technical condition of the stock market is now very strong. Over extended margin accounts, they pointed out, have been closed, and stocks have passed from weak to strong hands There IS a large short interest outstanding, it was added, which means that stocks winch have been borrowed and sold in the open market will likewise be pur- chased in the open market and returned as soon as prices begin to advance. The belief that prices will advance was based on the war-order business ahead.
 SPECIMEN STOCKS
 Those who hold such views should find no difficulty in selecting dividend paying industrial shares which are now selling far below the high prices of last year. Here is a table of a dozen of such stocks showing the high price for 1916, the low price for this year, only recently touch- ed, the present dividend rate, and the income return based on the low price and the present dividend rate:
 High Low Div. Inc