New-York tribune., 1920-12-06
Trade and Finance
Developments of the Week
and Their Bearing ON
the OutlO6k

a STATE OF equilibrium prevailed in the
stock market last week. The major eco
nomlc forces making for lower prices
ceased to operate, and enough buying
/ power was cxerted in the marketplace
10 absorb offerings. Despite Irregular
ity IN the trend, prices of industrial
stocks surged to slightly higher levels,
and still more adherents we're converted
to the view that the worst of tho storm
in the exchange has passed.
In the commodity markets, too, cur
rent prices revealed greater resistance
than has been demonstrated for many
weeks. This phenomenon led a few
bankers, sensitive to the situation. to
assert that perhaps the bottom had been
reached. Although prevailing prices
were sufficiently low to induce buying
by some who had hitherto adopted the
policy of watchfully waiting, the at
tempt to draw the line and say to prices.
Thus far and no further" is extremely
hazardous, and this very attempt to
dogmatize vitiated tho judgment re-
garding swings recently Of many OBJ
servers who ought to have known better
Already a tremendous amount of the
water Of imitation has been written out
Of commodity quotations, and the turn
Will come a s soon as enough buyers re-
gain confidence in prevailing prices. The
key to the problem is the attitude of the
buyer. and, knowing that he is in
strategic position, he is studiously avoid
ing any act which will encourage sellers
TO run up prices against him.
AT this moment in the nations his
tory, when the heralds of prosperity
seem inarticulate, it Is interesting to
learn from Warren S. Stone, president
Of the Brotherhood Of Locomotive En-
gineers' Cooperative National Bank. al
Cleveland, that results have surpassed
expectations. This is the only national
bank in the country owned and operated
by labor organization. Writing to the
financial editor of The Tribune at the
end of the first months business the
other day, Mr.. Stone, who is also chief
of the brotherhood, said: eve have now
been in business thirty days, and the
results obtained thus far exceeded even
our expectations, One of the remark
able things about the bank, so far is
that the savings accounts are greater
than the checking accounts up to date.
This is unusual with national banks. as
I am told by other bankers that the
checking accounts are generally in the
ratio of three to one with the savings
accounts, but with us it has been exactly
the opposite, so that the bank is really
accomplishing what we started out to
do" Students of finance are watching
this experiment with much interest, be-
cause it represents q new expression
Of the power Of labor. Mr.. Stone has
indicated that the bank does not repre-
sent revolt against existing banking
methods, but rather an attempt to in
vest brotherhood funds proftably. In
proportion as the leaders of the new in
stitution adhere to sound banking meth
DDS and eschew the temptation to yield
to the urge of sentiment or politics, the
brotherhood bank is likely to succeed.
With the Anglo French loan already
deposited in the archives, the British
Treasury is directing a new flow of
gold to the United States to build up
its balances here. Already 5000 900
has arrived. The government at Lon
don believes in using gold to enhance
its credit and to increase it's prestige
1t is not afraid to permit its reserves
to grow thinner, provided the lost
m retail contributes to the establishment
Of greater confidence in Britan's po-
sition in the counting rooms and the
marketplaces Of the world This policy
is almost Numerically opposed to that
of the French Treasury, which believes
that gold should be retained in it's en-
tirety, SO far as possible, as a reser-
vor of financial strength. France takes
literal view Of the worth Of gold. The
British, on the other hand, lay great
emphasis on the psychological reserve
and they lose no opportunity to aug
ment this, either by shipping gold or
by any other means available. Part of
the recent gold flow to the United
States, it is believed, has been en-
ployed to reduce the amount of British
Treasury bills outstanding and the
present total is only one-ffth Of those
outstanding at the peak.