Evening star. [volume] (Washington, D.C.) 1854-1972, 1919-01-05
FINANCE
AND OTHERWISE

MU UtMhVI6
| the future course OF prices is confused.
There is nothing particularly note
| worthy in this because at few times in
the history of markets have men been
able to clearly read the future of quo
j tations-that is. the course OF prices In
the near future-the future of tomorrow,
naxt day or next week. The course that
prices will take in the farther future is
a question with which spectators do
| not generally concern themselves. Spec
ulation feeds on quick action and plenty
of it. The Spectator wants quick
turns" The future beyond that OF to-
morrow. next day or next week is the
concern Of the investor-the man who
buys an interest in a property wilosa
something about, whose prospects he
believes in, and who is content with
dividends wtiIe awaiting appreciation
in the price OF the stock.
Eut it is the claim now that market
sentiment ia more than usually con-
fused because of the titanic struggle
through which the world has passed
besca use of the co ordination OF industry
TO WAT purposes, IDS SudlSH COtiiPSC
of the central powers, the necessity
that industry, wrought to high ten
sion on war work. must readjust it
self to peace production There Is the
fact that prices for nearly all ma
terials7 continue at or close to the
war level If they remain at that
level will the public buy more than
it requires for emergencies or for
day-to-day needs is a question to
which men make different answers
With high prices and small demand
can the earnings of industries be
maintained: And if prices should
com down what will be the effect on
the earnings of the companies making
the goods?
Labor Issue Intricate.
There is also the question of labor.
A substantial drop in wages cannot
be reasonably expected while the price
remains where it is 1t was the cost
of living plus the urgent demand LOT
intensive production OF war materials
that carried wages to their present
level. All these factors in the eaua-
ton make for. difficulty in the solu-
ton Of the problem. One who would
seek to work it out is surrounded by
unknown quantities.
It cannot be determined whether
American industry will go ahead at
I canacfEY DFOuUGttoIEy anu - II ciiouAo'
whether the production viii be highly
profitable or moderately profitable or
whether the margin of pI-pflt VIII be
thin or vanishing.
Sentiment as to the more distant iu-
ture. is not mixed. 1t is nearly all one
way 1t is that when industry shall
have become adjusted to the condi-
tions of a peaceful world great pros
perity will be the portion OF American
Industry. The uncertainty is as to the
tr., oil ion narin1 Quotations are SUD-
posed and widely believed to reject
the future. Quotations on the stocks
of the major and the minor industries
are hesitant. They seem timid- They
are undecided as to whether they
should advance or recede. They take
a nervous step in one direction and
then in the other,
Long-range sentiment. applied to the
quotations on industries of demon
strated earning power, is bulliSh. but
a sufficient number of security holders
have been timid enough to hquidate,
and the professional element. more
concerned in quotations than in val
1bes, is generally beariS1.
Railroad Situation Perp1exing.
The railroad situation is perptex-
ing, but there are certain encourag-
ing features which ought not to De
overlooked. The railroads We're taken
over by the administration, under au-
thority of Congress, as a war m PAS
ure. and not for the working out of
an experiment in government control
which might lead to government own
ership. 1'hey were to be- returhef to
their owners within . speeinedt ftod
after the close Of the war Z sing
ment raised freight rates and passsen-
ger fares I'd level which the COM
panies had not dared Ito ask. The
government eliminated aVl composition
between the roads, thing wnlch
the companies were prohibited doing
by law The governm emit reduced
travelling facilities for the public to
a point to which the COMPANIES could
not have dared go. The iSovernment
raised railroad wages to- a point
earnings of the roads under the reg
uIations of the, Interstate Commerce
Commission and tha vexatitns of the
various state railroad commissions
Notwithstanding the elimination OF
compet1t ion, the remarkable increase
in tariffs and the reduction irt service
to the public the net earn1ngs OF the
railroads, are decreasing. Ihe In
creased gross earnings OF tTfe lines
are more than taken up by the In
creased cost of operation UNDER gov
eminent unified control.
The director general of the rail-
roads wants lye-year extension OF
government operation, not as a war
measure, but as an economic eaApeTI-
ment. That denied him. the threat is
made that the railroads will be I'M
with their organizations disrupted
and their maintenance charges in
peryision of the Interstate Commerce
Commission and the state eomnis-
sions under the same laws which pre-
yailed before the war, and under
which the railroads could not now do
business. The sentim emit of Congress
is reported to be that a hve-year ex-
tension of government operation Will
not be authorized and that Congress
will frame new and suitable laws Dor
the roads before they go back to
corporate operation.
The effect of all this on the prize
of railroad stocks and bonds is dim
cult to estimate. When the roads were
taken over by the government under
certain payment guarantees the Prices
Of their stocks and bonds went up-
The Year 1918 to Da
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