New-York tribune., 1920-11-15
Finance and Trade
Developments of the Week
and Their Bearing ON
the Outlook

The stock market moved thundcrous-
.ly last weak without much regard for
the prognosticians Of those venture
some observers who undertook to dog
Matte. AS each nuctuation carried Sc
curities down to new low levels for
the year, one was reminded of the
oft-told tale about lawyer who as
surcd his client, who was already be-
hind tho bars, that he could not be
imprisoned. After the sweeping decline
of Tuesday, somc of the more articu-
late brokers hazardcd the opinion that
stocks could not 60 lower. But their
assertion that bottom had been touched
was soon made obsolete by subsequent
further declines.
Writing imitation out Of current mar
ket values was q popular pursuit
last week. Many commodities which
in the last six years found themselves
on an unprecedentedly high price ba-
sis last week became cheaper in the
primary markets, where the lowest quo
tations Of the year for cotton, wheat
and corn were registered. The tumb-
Ing Of the prices of things created u
speculative atmosphere which facili-
tated the crash in security values. In
the ak days Of market activity last
week twenty representative railroad
stocks, yielding to the downward move
! ment, declined from 1885 to 67.54.
cifacing share Of the gains estab-
Nshed since the attempt to translate
the new status Of the railroads into
higher quotations for their securities.
Thirty typical industrial stocks, which
followed the technique of the shoot
the-chutes, dropped from $3.50 to 1888
in a week. Before trading was over
on Saturday 155 active securities, main
ly industrials, were quoted at the low
est levels established thus far in 1920.
and the averages also were at the ebb
for 1920.
In the bond market dullness pre-
vailed and prices turned slightly low
er. The output of pessimism reached
maximum production, and deferred in
some instances prospective buyers Of
bonds, even though investment securi-
ties will benefit from the effects of
the defia, on movement. The principal
cause for the check in the rally in
ponds, however, was the abstention of
dealers from the market as buyers
instead OF accumulating fresh supplies.
they sought to work off bonds that
had accumulated during the recent
period of rapid issue of new securities
What has been happening in the bond
market in the last week has been the
process of digestion.
Zach wave Of drastic liquidation en-
courages flood of philosophical specu-
latlon as to whether the turning point
mas been attained. To those who in tho
midst of declining movement which
muitlplles fears and impairs confidence
can discern the place of transition.
huge rewards accrue. This matter ;s
at the heart Of the present speculative
problem. The cautious are still with
holding an opinion and many of the
more vocal have already been proved
wrong by events. And yet, after each
new collapse of security values, new
adherents are won to the notion that
stocks are cheap. Brokers are now
calling attention to the fact that Sc
we're selling movements are usually
overdone, and contend that, though
prices may go lower, the time for buy
ing stocks for the long pull is ap-
preaching.
There is little enthusiasm for the
outlook for stocks for the remainder
OF this year. Early in 1921 it is pre-
dicted that the dehation of commodity
prices will be reflected in an easier
money market, after maturing COM
mercial loans are paid off where pos
sible. This expected change in the
credit market will relieve the market
| of one adverse factor, yet it will not
necessarily cause an upward move
ment. A considerable share of the
decline in stocks has been a corrective
OF the excessive spurts during the bull
market of 1919. Changes in the in
custrial situation have detracted from
the intrinsic worth Of some shares.
but the downward movement is almost
certain to carry stock quotations too
long. Easier credit conditions would
not only make it more feasible for
prices to recover from an oversold con-