New-York tribune., 1920-08-26
Mixed Tone lin
Stock Market as
Money Rates Rise
Sharp Recovery of Day Be-
fore Halted; Industrials
Suffer Recessions; Rails
Display Firm Undertone

From the point of view Of the stock
spectators in Wall Street the most
significant development yesterday was
the sudden jump in call money rates.
An advance in the closing hour to
per cent--some loans were made otter
the close at 9 per cent--was accepted
as evidence that the time is not yet
propitious for sustained recovery in
speculative stocks and that the credit
situation still remains as the con-
trolling influence. The outlook for the
fall may be more hopeful, and most
bankers take that view, yet the credit
supply is far from heing adequate to
meet the needs of revival of bullish
speculation, even though, as many OBJ
servers hold, stocks by their decline
since early in the year have rather
thoroughly discounted the worst that
may happen to business and industry
in the way Of general depression.
Hopes of traders that the sharp
ried further in sustained movement
toward higher price levels failed to
materialize. The bear party, it is true,
was still suffering from the effects of
its unpleasant experience of Tuesday,
when rising prices caused general
stampede to cover, thus accelerating
the movement, but after some further
buying for the shorts at the opening
and for time thereafter the market
turned dull and then irregular, with
industrials in most cases displaying a
tendency to sag off again. Only in the
case of the rails were prices main
rE Of
tirmness, and here, too, as the day
progressed, appeared signs of hesita-
ton In the afternoon when money
rates began to work upward, profit
taking sales and fresh offerings for
the decline served to unsettle the in
dustrial list, causing, in many cases,
substantial setbacks. A reaction of this
kind was not expected, by any means,
in view Of the rapidity of the previous
recovery, but it rather took the wind
out of the sails of traders who had
begun to talk OF much higher prices
Certain groups were affected bv spe-
clal influences yesterday, and one of
the most interesting movements was
the rise IN the shares of the shipping
companies, which mounted in direct
response to the announcement of in
creased rates. The European situa-
tion did not look quite so promising
IN view of the reports that the Soviet
representatives might break off the
peace negotiations with the Poles at
Minsk, owing to failure to arrive at
acceptable terms. This, no doubt, oc-
casloned renewal of selling of in
ternatlonal issues. Announcement of
the appointment of a receiver for
Bethlehem Motors should have oc-
,casioned little surprise, for it had long
been known that the company was in
volved in financial difficulties which
could be solved only by a complete re-
organization Of the property. The
stock, however, broke sharply and
caused sympathetic selling in other
parts of the list, especially the other
motor shares. The case of the Bcthle
hem Motors is interesting, for it en-
phaslzes the credit problem with which
many other concerns, especially those
which are not we'll seasoned, are wrest-
ling.
rather striking recovery occurred
IN sterling exchange, lifting the rate
on on London at one time fully five cents.
Inc movement was plainly reaction
from the steady decline of the last few
weeks There had Been great deal
OF speculative selling in this decline,
and yesterday the covering operations
OF the exchange spectators turned
the trend. The other exchanges were
generally firm in sympathy with ster
ling