The Miller press. [volume] (Miller, S.D.) 190?-current, 1919-12-11
Reckless Investment Followed by
Heavy Losses When Market
Goes to Pieces.
GOVERNMENT SECURITIES
REMAIN SAFE AND SOUND
Uncle Sans Bonds "Good as Gold"
While General Slump Wipes
Out Fortunes.

New York.-Semi-panickr declines
in the stock market and subsequent
relapses from the partial recovery,
with heavy forced liquidation of light
ly margined holdings Of the popular
market favorites on the New York
stock exchange have demonstrated
cleary the dangers of speculation.
For six months the stock market adj
vanced, slowly at first and with the
usual "p~rofit-taking reactions" and in
recent weeks going up by leaps and
bounds in some departments of the
market, notably oil, motor and other
Industrial" shares. Then in a few
days there has been a decline wiping
out much of the advance of months
in some stocks practically all Of the
advance.
There was reason behind the ad-
vance, but a speculative craze carried
it beyond reason. Eastern market
reports for months have carried men
ton of buying by "the public" High
wages, war profits, the prosperity Of
industry and agriculture have given
many the fever to speculate.
investments Prove Disappointing.
Financing OF new and old corpora
tions by stock, bond and rote issues
called for hundreds of millions of dol
lars. Issues OF preferred stock alone
since January ! have totaled
than $500, 000, 900 and common stock
a billion more. Foreign loans with
mora In nrOCnnpt fn Hnnnnn EN1ynna'H
buying added to the burden. The
immense buying power of the coun-
try shouldered the load, but specu-
lation in listed shares was getting
out of bounds. Money rates began
to show the strain. Three weeks
ago call money in New York rose
to 1870, the next week to 20So and last
week to 800, the highest point since
the panic of 1907. Renewals touched
14%o, the highest in years, and time
money hit SO. The advance was a
warning from the banks to go slow.
Pools" and "tipsters" began to draw
in their horns.
The decline was orderly until in
Sul'iStShlAy mai lhtu dtGOhALS "elS
~liquidated. Then xcame a smash.
General Motors new common stock,
which had scared to 406h dropped
TO $50, Mexican Petroleum from
255% to 1S6, Texas company from
1913 to 2S6. Studebaker from 143B to
10S&. American Tobacco from 307A
to $40, Crucible Steel from 235
to 200 and so on down the list.
Even U. S. Steel, the porverbial mar
ket barometer, declined from 1925
TO 103.
The break extended throughout
the list, less marked of course in
lower priced stocks. The bond mar
ket also suffered.
Perils of Speculation Shown.
Since the eliminating slump there f&.T
been recovery ranging from 2 or 3 poiltz
to around 20 to IS points in stocks whics
suffered most on the decline but dowg
swings followed the recoveries and LSt
marked atmosphere Is not yet considerC~
cleared.
In a nutshell a speculative craze a:
the banking interests and the Fed raj
Reserve Board against overspeculatio r
and the crash came.
No better illustration OF the perma fsrmt
and fixed value of government securities
can be found than in the present uns t:
Treasury Savings Certihcates and
Liberty Bonds continue their interest
bearing career unaffected by the storms
OF financial stress that overtake less
favorable securities.
"