The sun., 1919-08-04
Writers Of Market Letters in
General Advise Buying
on Larger Declines.
SOME PREDICT UPTURN
Others Declare Bull Movement
Of 1919 Has Reached
Its End.

rtety Of opinion regarding the immediate
outlook ranging from a belief that the
coming week should see sharp up
turn. provided there be no unfavorable
developments, to the positive statement
that the great bull market Of 1919 Ia at
an end The houses which express
more conservative opinion say that II IL
virtually impossible for the general mar
ket to move constructively without
technical readJustment but there 10 gen.
eral agreement that stocks should be
bought on any substantial recessions.
II IL noted that buyers Of stocks are
becoming moro and more discriminating,
n fact which tends TO give the bears in
creased courage Most houses are hope
full that even a moderate reaction might
serve to furnish the starting point for
a resumption of the advance. On the
other hand, there appears to be, accord
ing to some brokers, q combination OF
circumstances which may bring lower
prices for a time, and 30 the discrtm-
mating purchaser, II Is anticipated. would
be in a better position than those acting
less cautiously.
Paine. Weber a Co. sayi '-The
money situation continues TO suggest
trading movements in the market as
whole, because loans tend to increase
power is thereby curtailed. This does
not, however. apply to the great tndi-
vidual resources which have not YET been
called to the support of previous COM
nitments, nor does It apply to the fresh
funds which will steadily flow into In
vestment channels from the surpluses Of
war prosperity. II must also be recog-
nised that profits fully as large as those
secured during the war and In some cases
much larger earnings will accrue in va
rious lines of business during the next
year. and perhaps the next two or three
years This viii react upon the stock
market In a double sense, first through
growing corporation revenues, and sec
ondly. through ability Of investors to pur-
chase the shares of the prosperous COM
panies- 1t Is probable that buying in
terest will become more discriminating,
because prices are relatively high in
many instances and some stocks may
tend upward while others will hesitate
or perhaps reflect realizing sales. The
general outlook. however. Is in our opin-
Ion very encouraging. The upward
trend is likely to be maintained until 1t
Is found that industrial and other cor
poration profits are approaching culmi-
mating points. From all Indications this
will not develop until 1920. and in some
cases the larger returns win not appear
until later date. thus providing reasons
for advancing prices over a still longer
period. 1t will be impossible for the
general market to move without tech
meal Establishments, but any recessions
In sound stocks should be regarded as
good investment opportunities under the
circumstances az outlined"
Have Plan to Aid Market.
Merrill. Lynch Co. say: Traders
have been trying to sell the market all
this week on news that had absolutely
no foundation, but they were handed
Thursday afternoon the finest material
to break the market. This was the
money rate. which ran as high as 20
per cent. and the calling OF loans by
some of the banks. This high money
rate has lead the Stock Exchange to try
and form a new plan whereby bidding
for money by different members OF the
exchange will be stopped and have one
member negotiate the loans for the
Stock Exchange II this goes through
II ought to help the market materially.
The market closed Friday not to open
again until Monday and unless the
money rate continues high stocks ought
to be bought at this level. The tech
meal position of the market is tremen-
dously improved by the break and II con-
ditions are favorable the coming week
we ought to see a sharp upturn."
Goodbody & Co. say: We are even
more firmly OF the opinion now than we
were a week ago that the great bull
market OF 1919 lie ended. The poor
prospect Of stabillzing foreign exchange,
the poor crop outlook, the growing labor
troubles, the race riots and the agitation
against the high and rapidly rising cost
OF living have so incress ed the cost of
doing business and have 80 disturbed
Industrial, financial and political condi-
tons that II 10 doubtful II the bull mar
ket can be got together again this
year. While the present reaction has
not. AZ yet, gone far enough to shake
the public loose from its holdings, Il has
demonstrated that the bulls are losing
and the bears are gaining courage. II
now seems probable that the decline will
until even the present big mar
gins have been exhausted and stocks
have changed from the relatively weak
to strong hands"
Holle & Stieglits say: Those who
look for lower prices present arguments
thai cannot be CLOSED over. for exam
pie. the fact that the fiotation of new
securities Is In such volume as to threat
en- the stability OF the speculative struc-
ture. On the other hand sight must not
be lost OF the fact that the FIVE Liberty
Loans have created millions OF potential
investors, thus broadening the invest
ment market to an extent hitherto un-
dreamed OF. On sharp breaks we believe
the standard shares are a purchase, also
the weaker rails on declines"
Advise Cautious Buying.
Shonnard, Mills & Co. say: pending
q solution Of the perplexing problem OF
sta biiiEing the foreign exchanges, II will
be well to proceed cautiously IN making
stock market commitments IrreEularity
Ia likely to continue for some weeks
longer. In the ultimate outcome, how
ever. we have every confidence At cur
rent prices United States Liberty bonds
and Treasury certificates are especially
attractive investments The recent
sta tement OF Secretary Glass to the ef-
feet that Government income will short |
ly be sufficient to defnay all expendi-
lures without further resort to popular
loans is decidedly favorable to out
Federal securities"
A. A. Housman & Co. say: with the |
messages going out from
many sources in the financial district. |
II is only natural that there should be |
some hesitation on the part OF the DO |
tential purchaser OF stocks. The market |
Is entitled to rest and reaction might /
serve to clear the air and furnish a
starting point for the resumption of the |
advance"
w. J. Woilman a Co. say: "AlI things !
we believe we ara entering |
\ period where unusual caution is de- |
handed. We have combination of |
circumstances which may easily bring |