The New York herald. [volume] (New York, N.Y.) 1920-1924, 1920-11-18
FINANCIAL NEWS
AND COMMENT
General Liquidation Spreads
Over Stock List, Knocking
Prices to New Lows.
MONEY is MUCH EASIER
Rails and Industrials Get Vic.
lent BlOws-Faint Rally
in Last Hour.

I Those interests which detected signs
| OF returning confidence in the financial
markets on Tuesday had their theories
very rudely upset by what occurred in
yesterdays stock market. Instead OF
continuation of the recovery. as might
/ have been expected in view OF the hope
fui tendency displayed by stocks on the
preceding day the market was sold
again almost from the outset on a
statement which was given out by O
I group of bankers following conference
at the close OF business on Tuesday
That statement was obviously designed
to cheer the financial community. and
| particular stress was laid on the bank
ing situation in order to reassure the
speculative public. But at the same
time. while emphasis was laid on the
soundness OF the general financial situa-
ton. the statement carried unfortunate
| ly a suggestion that the bear party
fear of serious opposition. that Is to
say. providing the decline continued or
derby.
The statement thus proved a BOOM
erang. and, after an hour Of 80 Of I'M
certainty. another violent attack was
launched at the share list, and it car
ried prices down TO new low records
for the year. With the weakness of
stocks came fresh selling in cotton and
grains. which had shown rallying ten
denotes on the preceding day. 1t is to
be recorded in favor of those markets
that the downward tendency was by no
means as violent as 1t was on some days
last week. but 1t was plain that the
statement had upset all calculations for
rally. Although the general tendency
Of those markets was discouraging.
there was at least 4 ray OF hope In the
continued upward tendency in the for
eign exchange markets, in which there
was another very striking gain in ster-
ling The money situation also gave
Wall Street hope Of encouragement, the
rate for new money getting down to
per cent for the first time this month.
This. however, was ignored. There was
a semblance of a rally In the last hour.
but It was more on account OF short
covering than II was a reflection of
easier money or even the exchange
market. ~
AS was the case last week the liqui-
dalton was very general again. 1t
involved the high grade railroad stocks
az we'll as industrials. although the SELL
l. ,,iO In no ~
the industrials. There we're sharp de-
clines again In Baldwin. In the steels
and In the motors, but the shipping
shares were really the hardest hit of
ALL AS q matter of fact the break ac-
tually started In American Information
al. which was sold from the start On
expectations that its directors would
eliminate the dividend at their meeting
to-day. The weakness OF that stock
was aggravated further good deal
shake-up in the management OF the
corporation when the dividend was
eliminated. From that stock the weak
ness gradually spread until It had In
volved the whole market. and once more
stocks were thrown overheard without
regard to value. Such issues as Amer
lean Car and Foundry and others suf-
fered severe declines under the pressure.
The money situation was good deal
easier than on the preceding day. There
was no change In the renewal rate from
that of Tuesday. but the drop to 6
per cent. in the last hour indicated
that still further ease in money might
be expected to-day. The money situa-
| tion however. was overlooked entirely
! In the struggle 10 sell stocks. Just as
| has been the case several other times
| this year. what this showed was
} what experienced observers have been
maintaining all the way along. namely,
that Il Is the general business situation
and not necessarily the money situation
which Is hack OF the present decline
! ia security values The continued re-
covery in sterling Yesterday carried Il
to above s347. which represented a
rally Of more than ten cents In n day
or so. Along with the rally In that
exchange came further Improvement In