The Washington herald., 1920-05-19
STOCK MARKET
VERY QUIET
All Efforts to Break Steadi-
ness Prove I'm
awaiting.
LIBERTIES AGAIN LOW
Market Holds Firm in Spite
OF Steady Liquida-
ton by Public.

New York. May 1S.-Not since
February OF last year has Wall
Street seen such small volume of
business as was done on the Ex-
change today. The market was
steady and efforts to break 1t were
unavsiling. The shorts are crowd
ing one another so hard that any
development of a favorabl charac-
ter would cause wild rally. There
seems nothing in sight at the mo-
ment. but when the market gets
in such a critical condition the un-
expected always hHppens and stirs
UP activity. Therefore the market
Is extremely dangerous for margin
traders on either side. but old
timers think the greater danger is
on the short side. The public has
been liquidating steadily. but the
sheets of leading commission houses
show that the insiders and really
important operators have been buy
ing quietly for the last week.
The short interest seems to be
made up of numerous traders rang
ing from ten shares to 200 or 800
each. The recognized statistical ex-
perts are all preaching panic so in
dustriously that most traders are
firmly convinced that the worst is
the statements coming out Of Wash
ington to reassure the public, for
the reserve bank has apparently
been confirmed by the conference
Of this week in its attitude toward
business men. Governor Harding
thinks satisfactory credit situa-
tion will be seen in the next month
kor six weeks. Members of the con-
ference believe that another month
VIII see general liquidation of
commercial credits. II commercial
credits are to be generally Iiqui-
dated within a month. Wall Street
will do well to. brace itself for a
shock. II may be true. as the old
timers assert. that technical cOndi-
tions demand a slaughter Of the
bears. but a month is no time at
all. for the reduction of the vast
credits OF the banks. Any great
reduction of the commercial credits
will cause serious trouble unless it
comes about through a free move
ment OF freight and breaking up
Of the congestion on the railroads.
The only way tIst now to reduce
credits is to sell Investments. Busi-
ness men are doing that with a
vengeance.
Liberty Bonds.
They put Liberty bonds down to-
day to new low records and even
made a new low price for Pennsy-
vsnia stock. The astonishing thing
about the stock market was that 1t
held so firm in the face of this liqui-
dation- 1t takes a remarkably good
stock to compete with United States
government bonds. selling on a 60
per cent basis as some did today.
In addition to the heavy selling OF
Liberty bonds by merchants whose
loans at the banks are being called
and who have to sell investments
BECAUSE they cannot get at their
cdrnmodities that are locked up in
fEeight trains. there is general SELL
Ing in eXDectationiof anothersbillion
bands for the soldier bonus.
The low price of Liberty bonds'is
causing savings banks and savings
ASSOCIATIONS to buy them in prefer
cace to making loans for home
huiIding. This is. going to hurt real
estate.
1 Wall Street had rumor that the
overnment might ask that Liberty
,onds be taken off the trading list
on, the New York stock exchange.
Serious minded bankers could not
believe that any such thing would
be considered for to deprive bond
holders of a market now would pre-
cipitate very serious trouble and
probably make some low records in
bond prices that would be memorial. |
Sugar stocks Strongest.
Sugar stocks were among the !
strongest on the list despite the |
threat OF an embargo against ex-
ports of sugar. In all the decline in
the market recently there has been /
fairly good buying of the local trac-