The Bridgeport times and evening farmer., 1919-10-31
HENRY CLEWS'
 WEEKLY LETTER

l good While past. That such formal l ratification will take place at an early date, possibly October 30, is the current forecast in some quarters. The adhesion of the United States to 1 the treaty is still in doubt, and the ! treaty is still in doubt, and the pre- dicuon of some political leaders that we shall so modify the treaty by res ervations as to eliminate much of it's 1 value has undoubtedly caused anxiety. 1 Should we practically precipitate our 1 selves into a situation in which we 1 had no definite connections with l foreign countries, and could not share 1 in the benefits obtained under the 1 formal agreement with Germany, our trade and finance would undoubtedly 1 suffer seriously in it's foreign aspects 1 From this danger it will be the first duty of public men to protect the nation.
 IndustriaIly the reports from ali over the country are encouraging, re- l flecting, as they do, good demand for goods and a great ability to purchase and pay for them. An abundance of 1 means in the hands of the public throughout the country has resulted 1 in steady investment demand for 1 the more solid kinds of securities as | well as in a tendency on the part of | the public generally to purchase and | carry stocks of the sounder varieties l This disposition has been well rnaiu- 1 tained in spite of an adverse money | situation which during the early part of the week showed high rates for | call funds; and during the latter part of the week, although carrier rates were reported, indicated a short sup ply of cash for market purposes.
 The investment demand of the country has been stimulated by the actual evidence before the eyes of the public everywhere as to industrial activity and prosperity. Hopeful in | this connection has been the report
 of the Bureau of Labor that com- modity prices representing the cost of living have been on the decline l during the past month and show q shrinkage of two per cent or more
 in most cases.
 As against this investment strength the speculative situation has been perturbed and dangerous. During the
 latter part of the week there was a sharp collapse among some of the
 favorite shares, including oils and a 1 variety of industrial shares which
 had been advanced to levels which
 Iefa them in an evidently 'topheavy'' i condition.
 With call money in relatively scant supply and likely to exhibit firmer rates a number of stocks which were in technically weak position should be looked upon with great caution
 and can be purchased only when the '1yHr :s in position amply to protect
 himself.
 in sympathy with the fluctuations of the market and with the high rates for call money. foreign ez,- change has shown during the week . , downward tendene--. This was sharp Y checked in the case of sterling eX- , change by the announcement on
 Tuesday morning of $25O. .0QO British loan estimated to yield II
 per cent. to the investor. one-half to
 3a used in taking up early maturities
 f outstanding bonds the other half
 9 be used n paying for commodiies
 -9 be exported from t-o United
 States. This operation will take
 fl from the market a burden ot
 .lort term bills which would other
 "ise tend to depress prices and will
 nt the same time afford demand
 ~cT some staple commodities probabI
 cotton in large measure, which might
 otherwise find trouble in fnancin5
 themselves. It $ believed that the
 zympathet effect of the British op- eration upon other exchanges will be good; and in spite of their general weakness, they have at least been checked in their downward move ment by the better status of sterling.
 Announcement at the Investment Bankers Association Convention in
 St. Louis that several foreign coun-
 tres would be likely 10 become can
 didates for heavy advances on the
 American market during the coming
 twelve months indicates that every
 dollar which Americans are willing tC
 hot | ployed in facilitating the sale of our
 goods abroad.
 The fact that such large issues
 are forecast necessarily points to 8
 superabundance of bonds and sug-
 sests a downward tendency in the
 quoted value not only in the new ones. but of those already on the i market. Feverishness and weakness in Liberty bonds has seemed to follow
 upon the announcement that the new , financing of the British Government
 was to be initiated.
 While the money outlook has not y been such as to encourage specula- i ton and investment, enough funds
 have been available from day to day
 to keep up a very large volume o1 | trading and to enable those who had P confidence in the future of securities to carry them by paying the neces- | Sary price for 1unuS Oollsluerdp4e | quantities of loan funds have beer E drawn in from the interior banks anc ! have scrved to eke out the shorten E ed supplies of call funds in the New ! York money market.
 E The reduction of the general re- E serve percentage of the Federal Re E serve System to about 4SGo has been E factor which tended to cause some E anxiety, but the expansive power ot the system is of course still enor- E mous Reports that rediscount rates E were likely to be raised in order te E check opera tions in stocks and bonds ! have apparently had little foundatieT and should scarcely be regarded witt
 much seriousness so long as needs o1 E Treasury financing continue Wha 2 they are at present time.
 q Firm rates for call money may s nevertheless be expected quite regard S jess of the situation in the Fedora a Reserve System, if for not other a reason than because the demand fol ss every available dollar for actual in s vestment purposes both at home ano q abroad is so unprecedently strong as a to promise a return far greater thar