Evening star. [volume] (Washington, D.C.) 1854-1972, 1920-07-17

Copyright. 1920. by $. P. West,


NEW YORK, July 17.-It is seldom
that Wall street has gone SO wrong
on a market situation as it has dur
ing the present month. A fortnight
ago it would have been hard to find
a piece of brokerage literature which
was not optimistic regarding the
chances of considerable advance
in July and August
The idea was that with the semi
annual settlements out of the way
money would be easier and that
prices having discounted the worst
that there was in general financial
and industrial conditions would be
entitled to have a good rebound.
The disappointing action of the
market this week is to be explaine d,
first by the discovery that credit for
Wall street uses was still as tight as
ever and second, by the disclosure
that the position in various lines OF
industry was more unfaVorapie IMAM
had been reckoned upon.
The speculative community once
again has to face the unpleasant
truth that where merchants ana
manufacturers all over the country
are bidding for funds at : per cent
and glad to get them at TINS ngure,
relaxation in the wan ,Ies sone ~
The stock market must harden 1tseit
to the necessity of an to per cent
call loan rate to last at least Ior .he
rest of the year. The only consoiins
thought is that had money easeo up
snfIiciently to allow a bull movement !
S,,r;na the summer the stock mar ket
Ivn,,td have entered the crop moving
sriod in weakened position. Inns
apon,;neency has been avoided py the
sharn setback of the past Weeh. 49,
has undone completely VIVA. c, I'D
speculative expan ,,s ~ Julv
~ only q Little Rally
=. ,s nointed out here week ago
-. +he inward turn III STOCKS INA
ent in toward the end OF june ~dS :,
M sense A fresh advance pul iIeis
a reaction from the excessive pe
mism which characterized VAN s'ie''
dealings in the late spring.
-, - a change in sentiment ana
~ I'm fundamentals. Thls sentl-
,rental change was not sure ehoue !.
RI itself to stand the test Wnen iilonty
instead of easing became hish aSH,l -
ma .'hen discouraging reports as to
90 .ffact of the coal shortage ana the
~ consequences of the Inadequate
oanerortation facilities began 10
cnn,a in from the manufacturing cen
Iters The complete shutdown OF the
anar;can WOODEN Companys mills not
hanause the business was not there,
but because under the practical DIM
cuI,ies of the credit and fuel situa-
t;ons il could not be received ana
nronerly handled, was the flrst thlng
which struck at the hopes OF STOCK
market improvement -
| This meant that in one of the I'M
nortant industrial lines the decision
had been reached that it was better
for a while to do no business at all
rather than to attempt TO do business
under the present handicaps-
Naturally this precipitated discus
sion of the situation in other INDUS
tries as to whether or not these were
confronted by similar difhcultles.
iruel shortage Important.
The probabilities are that the effect
of the fuel shortage and the lack OIL
cars to transport finished products
| has been exaggerated in the discus,
sion of the situation in the steel
| trade. Still the reports are that IN
| certain districts the steel mills are
operating at only half capacity. and
| these reports have necessarily beer
accepted as a basis for Wall street OPP
| erationS. t.t.. .--r-.. - = -
| The problem which industrial com
iranies with large inventories have II
j obtaining the necessary credit /;
nothing new. yet its influence upof
4 the market Of the week has beer
| easily perceptibIe. Thsn. too, despite
all denials the evidence persists tina
\ the tire concerns are oyerstocked II
many instances and that more thar
| one automobile dealer is contemplat
ing cut in prices.
Develops Fresh Selling.
] The result of all this has been in