The Richmond Virginian. (Richmond, Va.) 1910-1920, 1920-03-15
DEVELOPMENTS IN
THE STOCK MARKET
~ BRoADAN WALL

New York. March lin the past
week there have been four distinct ae-
velopments any one Of which would IN
normal times have been sunicient 10
check the worst kind of bear market
and start prices upward. The combina-
ton has had the effect Of exciting wall
street and forcing wild covering OF
short contracts, but many persons are
still in doubt as to whether the iin-
provement will continue. Even me
most pessimistic of the bear party must
admit that the situation IL vastly Inn
proved. The covering that has taken
place has weakened the technical con-
dition OF the market. but stocks are 50
| low that most of them are still seliiaG
! at panic prices when one looks at their
| values
| The four big developments in the pr
| der of their Importance to the stock
market arc
| First, the demand of tie senate for
| an explanation from the federal reserve
| board of the usurious money rates that
| have been charged BY the banks;
! Second. reafirmation by the supreme
court OF the cid principles that in
valuing railroads the cost as of today
must be taken and not the original
cost:
| Third. the supreme court decision
that stock dividends are not taxable as
income, and
Fourth, announcement that the Brit
ish are to ship some s200.o00,ooo OF gold
to America in settlement OF the Anglo
! French bonds: some of this gold to ar
4 rive in the very near future.
/ Announcement of these various
4 things caused excited moves in the
i stock market from day to day, but 1t
!. is not believed by investment authori-
ties that the general public has begun
to appreciate the Importance of wha-
4 has taken place in America. For a
I generation the courts and the poiitt-
clans have been fighting the great cor
porations with the announced intention
of destroying them.
Now suddenly the corporations are
all right II is the hrst time fundamen-
| tails have been taken to the supreme
court since Roosevelt started the fght.
Property interests therefore feel safe
Men can now 60 ahead and work with
the belief that what they earn will be-
long to them and their children. Bus
mess ambition which was repressed is
now released again and 1t is released
ut time when America is the richess
country on earth not only In undevei-
oped wealth but in actual cash.
II When the supreme court rendered Its
decision on the valuation of the rail-
roads it merely reanirmed an old doc
!, trine, but it applied it to new situa'
tion and it means that practically every
, railroad in America will be found to III
: | under capitalized There is not rail
road in America that can be reproduced
! for the stock and bond issues standing
against 1T. Therefore great possihili
. ties exist of stock dividends being de
clared to make the outstanding securi
ties square with the values they rep
: resent.
The stock dividend decision Of thu
supreme court makes declaration o
D such dividends by the railroads an cas-,
; matter and confirms many stock dsvi
bends already declared. Among the In
dustrials there are corporations who's
assets have grown out OF proportion I,
= the stock issues and there will be decla
rations evening up these situations.
The United States may look forwar,
. to a perfect orgy of stock dividends.
The supreme court Is perfectly RICH