The Bridgeport times and evening farmer., 1920-03-01
HENRY CLEWS'
 WEEKLY LETTER

Acting with unexpected speed on the railroad measure, first the House and then the Senate ratified the re- port of the Conference Committee without introducing any material changes, thus sending the measure to February 23. The action thus taken was of the utmost interest to the stock market for two kinds of req sons, those directly connected with the future of rap~oad shares and those growing out of the general policy indicated by the action of Con gress.
 As for the railroad shares them selves they immediately scored ma terial advances, as was to be ex- pected. It was natural that the bill carrying, as it did, provision for help ing out the so-called weak roads, from the earnings to be made by the stronger lines should have been re- garded as more favorable to the ow-priced rails than to those of higher investment value. This view was reflected in market transactions, although it was pretty generally ad- mitted that the time was as yet too SoAIy lO oitO" pOS1l1N0 CC te reached as to the effect of so com plex and thorough going a measure of regulation.
 From the more, general standpoint the action of Congress was regarded as having important economic and political bearings because it showed a disposition on the part of the leg islative body to defy the dictates of trades union autocrats. A wholesale influence upon general prices was accordingly exerted by the action of the Senate, although some irregular ity at times was shown on rumors that the President might be dissuad- ed from signing the bill, owing tc opposition of the labor unions.
 Money Situation Difficult.
 The difficulty of the money situa- tion was once more presented in an acute form by the reduction of the Federal Reserve systems ratio to 42.7 per cent. at the opening of the cur rent week, coupled further with the unofficial announcement that the FNede. al Reserve Bank of New York had temporarily fallen be.ow it's Iega ratio.
 The situation thus depicted em- rhasized the necessity for further contraction and made it plain thar i borrowers could not expect any easing at the rates for a long time ta l come. This unfavorable percentag: was almost immediately followed, al l though doubtless unintentionally so i by the publication of the Board: i annual report, the central feature O 1 which was a defense of the policy O | credit contraction and deflation anC 1 a recommendation to Congress o 1 more than it now possesses for tn control of bank rediscounts. It wa
 natural that, notwithstanding a cal
 money rate of per cent had pre-
 vailed for several days to thes | events, the rates should have beer
 again marked up to 15 per cent. b, l the middle of the week, thus em 1 phasizing the indisposition or in ability of bank $ to do anything t
 relieve the sharp tendency to liqui i dation which had again manifesto itself in the industrial shares. Rumor concerning an early impending ad vance in discount rates were in par substantiated by action taken at tn
 Federal Reserve banks of Philadel
 phia and New York in raising tn
 rate on paper secured by Treasur certificates, which is believed to fore
 shadow further increases at othe
 Federal Reserve banks in the nea
 future.
 Altogether the money situation ha
 not eased but has become even nor discouraging to the operator wh i wishes to make long commitment
 than was true at an earlier date.
 Foreign Trade and Exchange.
 ! Foreign trade figures given to th public on Tuesday furnished a COT ! siderable SlIrpriSt. to some who ha , ] been expecting to see them refleC , sharp reductions in exportation. \ only did they fail to indicate > thing of the kind but, on n, COT
 trary the increase over DeceTl Der WE very marked and the only encouras l ing feature from the broad gener; standpoint of international adjus i ment was the fact that importaHo
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