Evening star. [volume] (Washington, D.C.) 1854-1972, 1920-05-01

May BE DfscOunting Dehatfon.
While it is admitted that the labor
situation is still serious; that the Pc
riodical adjustment Of wages and cost
IS creating uncertainty, while credit
is somewhat strained and the reserve
board has inaugurated sliding scale
of discounts as against banks thae
may make excess loans, there does
not seem to be anything in the sit
uation that would warrant the con
tinuation of the drastic perloa 81
liquidation that the market has oeen
going through. unaccompanied o!
anything approaching panic conoi-
tions.
wise men of the street have advanced
the theory that the market IS peein-
ming to discount the period OF de-
fiation, the inevitable let down from
war imitation.
If their Judgment in this matter be
true present levels might be expected
10 give way before further adjust
ment.
The political situation. badly mixed
to say the least. IS causing some
worry. The soldiers bonus if raised
at all must be raised by taxation; ana
there have been suggestions OF re-
troactive taxation of war prohts.
which no doubt helped to jolt the
street. although late news is rather
against the proba bility OF such action.
Some BeariaA IAAuenees.
After the excellent report Of the
Omitted States steel the street found
cause for complaint in that the d.
rectors did not give any extra diyi-
dend on the common stock. but ad-
hered 10 the 5 per cent regular dis
fribut;on-a fact that they might
have anticipated had they been able
10 interpret the Gary digest on the
policy Of the corporation managers.
The big quarters earning-the
large increase for Narch-was with
out effect. and the new low for the
stock was reached in the elimination
of Fridays weakness az s3h. loss
for the week Of ~ points. where an
advance would have been in order in
normal days on the excellence OF the
earnings
Bears regarded thu Reading deci-
eioa is favorable to themselves. for
the reason that i will require years
for the completion Of orders Of the
eour- in the matter OF dissolution.
with small chances for distribution
Until the edict has been obeyed.
The threat Of disturbances by rad
icAlS May day may or may not have
exsrttd q bearish influence. as some
people give credence 10 these threats
and others DO not
Money IS the one big influence OF
the dsy-that il. il would be the big
influence IL the street were paying
ks@d 70 the usual matters that cause
the rise and fall Of the price barom-
e.er. as attention was apparently yet-
Ting on putting out snort lines OF
stock. taking in few prodtS now
and then. only TO make the commit
ment On the short side a little larger.
ssre-Thisg BarEain HusteFs-
Bear gossip was SO thick. the gloom was
even more dense, and the bear position
apparently was 80 sure that that small
contingent Of bargain hunters who long
since acquired the habit Of keeping close
watch on Notwithstanding out as they
thought that the high was about reach
ed. and holding aioof until such time an
they considered values to be grinding on
the bottom-nade their appearance on
Friday and picked up quite few stocks
at what may be bargain figures-.n the
future: for this class Of investors goes
into the somewhat distant future for its
lQuidating.
Improvement in the market have found
small cause for satisfaction In the ac-
lion Of the week, but they are intent on
the technical position Of the market. on
the big line Of outstanding shorts. which
without a substantial rally.
They were less confident following
fridays liquidation and found small
comfort in yesterdays action.
Asks Rehearing on steel Suit.
The government has asked a rehear-
3ng in the case Of its application for
dissolution Of the United States Steel
Corporation. II this was a bear argu-
3nent. II surely was not an effective one.
for the feeling among those most deeply
interested in the matter Ii that the APP
3,ication will be denied that the filing
of such an application after the highest
court had handed down a mandamus
ledented in legal history.
The ruling in the Reading case il said
20 have inspired the appeal for rehear-
ing in the steel case.
Railway shares Irregular.
Tho railway group has been dIsap-
pointing in its action. At times. espe-
CialIy following the Reading decision.
there were some advances. but almost
without exception they have gona back
No group could hold while the general
list was as weak as II was. The street
start for higher levels Southern Pacific
will be IN the lead. counting II as ono Of
the most valuable and oft referring to
Il as an ''oil' stock.
Physical valuations Of number Of
railroads may be in before another
week and they may or may not be
such as to cause betterment. Labor
conditions on the various roads are
still unsettled at best. and no one
Knows where this uneasiness 10 going
10 end.
One of the leading Wall street
louses gave this advice to its Gus
TONERS:
I'VE believe 80 per cent of the
epring decline Is completed. We also
think we will not be out of the woods
until May to 10. Therefore we
would either buy stocks and hold
them for a rally. on the theory that
they will not go very much lower OF
we would stay out OF the market for
Ahe next eight or ten days. in which
I'VE doubt II there will be any sus.
tanned rally. We look for a sharr
rally following each additional break
with a much larger rally due from
present levels than anything we have
lad yet. We do not believe that the
market 10 as weak 40 1t appears
Mexican Petroleum. Pierce-Arrow
end Baldwin Locomotive seem t.
have reached the low Of this move.
1ent and should move up.
"A week ago today Steel common
bold at s5H. 1t has been but it'll.
Srore than 2 points lower. although
1esaimism has been persistent witt
fh5 rank and fle Of traders selling
short. and We cannot but believe thai
i the technical condition 10 such tina
J D quick response to any favorable De.
Relopment 10 probable. Anarchy and
panic should not m4toSiAliSo IN thii
country. and We do not believe IL will