New-York tribune., 1918-12-23

Without important change in
fundamental conditions, the week
IN Wall Street was characterized
by generally declining security
prices. Railroad and industrial is
sues both moved toward lower lev
els throughout the greater part of
the period, with the reactionary
tendency most pronounced in the
railroad group, where liquidation of
investment holdings made itself
felt. 1t was plain from the action
of the rails that the owners of
securities of this character are
much perturbed over the outlook.
There is a general unwillingness to
enter into new commitments in rail
road stocks until the vexatlous
problem of future control has been
solved. Director General McAdoo
did not help matters last week,
from the viewpoint of the stock
market, when he predicted lower
freight rates within twelve months
II his five-year control plan is
adopted, declaring at the same time
that railroad wages must not be re-
duced. The question of railroad
control comes before the Senate
Committee Immediately after the
first of the year, when it is to be
hoped that the outline of some def
mite plan of control can be evolved.
Industrial stocks lost ground last
week largely as a result of the un
certainties that surround the gen
eral financial and industrial situa-
ton. Offerings were not heavy, but
the disposition of the trading ele-
ment to await developments tended
to decrease the buying power so
that prices gave way easily at times.
There were two outstanding de-
velopments in the investment bond
market last week which attracted
widespread attention. First, was the
heavy selling of Liberty bonds, re-
sultlng in decline to new low rec
ord prices; second, a testing of the
bond market by the f1otation of an
issue of long term railroad bonds
The selling Of Liberty bonds was
explained in various ways. 1t was
stated that many persons who
bought bonds for patriotic reasons
no longer felt it necessary to keep
their holdings. also that there was
probably considera bic selling on the
part of holders who desired to es-
tablish losses in anticipation of
income taxes and could not do SO
without actually disposing of their
securities. Undoubtedly the need of
holiday money has caused many
small holders to sell out, and the
aggregate of all the offerings was
more than the market could absorb
without depressing prices. AS a re-
suit of the decline in the 4As the
income yield has risen to we'll
above Az per cent, which is high
for a bond possessing the advan-
tages of an obligation of the United
States government.
The quick sale Of 100000 Of
Pennsylvania Railroad 5 per cent
long term bonds was both interest,"
ing and important from the Wall
Street viewpoint, for it represented
the largest piece of railroad fnan-
cling that has been undertaken in
"a great many months. The success
of the offering was foreshadowed.
however, fortnight ago, when the
Chicago & Northwestern Railroad
sold 10,000,000 of long term bonds
on satisfactory basis, there being
heavy oversubscription to the
issue Now that the ice has been
broken other new railroad financing
may be looked for, in fact, the end
of the week saw the completion of
arrangements for a new issue of
st. Louis & San Francisco ten-year
bonds.
Offerings of money exceeded the
demand in the local market last
week, with the result that rates
were further lowered. The rate for