The Bridgeport times and evening farmer., 1919-02-04
I, l. WATSON'S
 WEEKLY LETTER


 extra dividend disbursement on the common stock of the United States ~teel Corporation and the reports of declining earnings due to trade read | tustments, profe5Si ona1 interests have been pressing short sales on the gen. eral stock market in an aggressive manner with a result of unsettlement 1 of sentiment and irregular ftuctua- tiona While expecting cross currents temporarily in the market for secuI1- ties on account of uncertainties now prevalent, we do not share the pes simism displayed in parts of the speculative investment community, and prefer to believe that during breaks in prices good buying oppor- 1 tunities will be offered in sound is sues. Purchase of good railroad stocks and first class bonds of municipalities that have substantial credit are best i investments at the present tine; and we might include a few of the better grades of public utilities.
 Conditions would appear to be shap- ing themselves for more cheerful pros poets with the coming of spring. If the next Liberty Loan is to be placed | tors, two things appear to be essen | tial viz, a satisfactory interest rate higher than that carried by the oth- CTS, and a favorable investment mar ket atmosphere to encourage albsorp- ton. Therefore in the spring---when the sap runs---price movements should be more constructive especially in view of the fact that some of the pending uncertainties will be removed ---notably, important basic factors should be established by the Peace Congress. Labor will be further H. ! quidated commodities will have de- cuned and the cost of living must automatically be reduced. Loan re- strichons have been removed on ac- count of an increasing supply of money, and the accumulation of in- vestment funds Is likely to continue to grow larger and press for employ ment
 | What the business world needs now is coDfidence---couffdenc in our abil- i 9ty confidence in the future and con fidenece that cur governments will cooperate for restoration of normal conditions. Lloyd George and George Clemencean are doing great practical work along these lines. "The worst thing shat can happen to American capital, labor and institutions,' vigor- ously says the New York Sun edito- rially, is for this waiting for normal marOzetB to go on. Resume business and we can prosper though we never do a penny of reconstruction work in Europe, Asia or Africa The placing of the United States on a prohibition basis will have d far-reaching effect on both capital and labor, wiping out at stroke 2S6 distiIlers, 992 brewers and 300, 600 liquor establishments, as wen as an income of $7O000,O0O and g taxation estimated at a billion. Charles M. Schwab expects a period of depression during readjustment- After going through Germany he is quoted as saying that the much lvaunted Germany efficiency recipe is hard work.
 In the copper as well as the steel trade, the sliding scale Of wages is now beginning to be effective with reduction in the price of the metal, and those industries working under such conditions may be tine first to reach normal conditions. IA good de- nand for Standard Oil issues has de- veloped as a result of the decision of Judge Mayer---whom we consider one
 of the ajblest judges in the Federal courts---that stock dividends are ex- eTnpt from Income tax levies. A TIlan- } Der of companies are in possession of
 large surpluses and will be able to tn- crease capital and make stock distrf-
 buttons Government ownership of ? railroads seems to be meeting with
 growing disfavor. Citizens of dem
 ocrattc republic want efficiency and not paterna1ism--two things which . do not arpear to mix well.
 Under the caption Of Need for Bet ter Transportation Facilities the Guaranty Trust Co. says: "It is gen. orally recognized thaE one of the great , weaknesses of our railroads has been ! the lack of adequate terminal facili- , ties, which has resulted in the con-
 gestton of traffic and in wasteful use
 of railway capital. The expansion o1
 our trade will necessitate larger and better port facilities and efforts = should be made now to improve them I But we cannot have adequate terrnt - nals or transportation facilities with 8 out providing sufficient credit for the railroads to expand their facilities t . . meet the constantly growing commer :. ~ial needs of the country. Whethe n this shall be done under government = supervision or government ownership d it must be done; and there is ever, e reason for believing that the wise [. plan would be to accomplish 1t unde }. private ownership of the carriers, wit {. government supervision and co-opera , tion"