Richmond times-dispatch. [volume] (Richmond, Va.) 1914-current, 1920-08-03
VANAD|UM STEEL STARTS
MARKET ON BAD BREAK
Rails Open Average of Two Points
Higher, but Show Net Losses
at Days End.
SPECULATIVE MONEY TIGHT
a1arkctwisc Believe Rate Decision
Is Eventually Bullish, but Would
10 Buyers Find Ready Cash
COstly-Equipmcn Go Down.
ny BItOADAN WALL.

III BtOADAN WALL.
NEW YORK. August 2-Thc whole
market broke badly today after :,
sharp rally In the first few minutes
OF trading. Railroad stocks opened
an average OF two points higher. In
dustriais were laSgards from the
start, and We're Immediately sold free
~ under cover OF the strength OF
the rails.
Within half an hour after the open
inS. the rails also were yielding be-
iorc the day was ended the rails had
lost practically All their gains and
some showed net losses. while the
ihdnStrla!s were down from couple
OF points 10 five and more. The clos
ing VAS very weak and active. at
about the low price OF the day.
money was renewed at per cen.
ana closed ut !. The government cot
ION report OF III per cent was more
builish than the street expected, aud
the option market advanced. a!though
me best authorities urgently advised
Nnnndium starts Brrnk.
The hrst serious break OF the dag
came In Eanadium Steel i, declined
eigh, and anc-hnlt points without .,
reaction There Wan a quick recov
cry o: half TIA" loss. but afterwards
the stock sold down again nearly TO
bottom. The selling was supposed 10
hc liquidation induced by the report
published last week showing the Div
'dend barely earned.
KcploS!e steel, the other company
controlled by j. Leonard Ecpl0.;!e
HAD Just such a break about week
ago. and for that reason the street
looked upon the Nanad!uin brcan to.
ga as entirely manipulated The
u 80, ana selling OF ali Kinds OF In
duHtr!als Immediately became !nsis-
tent. RcplOg!e declined nvc points.
Sironb"rS nine and bosch Magnetic
more than five. United States steel.
Cruclhic. Corn Products. baldwin ana
MeAican Petroleum were most severe
~ shaken.
Mexican Petroleum Is putting down
seven new welin and :oUr OF which
should he brought IN within the next
sin'y days. The recent heavy rains
IN Mexico delayed work for two
weeks. which accounts for the failure
To bring In the well tina, was cN-
n"cted about ten days ago. The gas
pressure IN those % the wells that arc
nearing; tn. oil IS such as TO justify
expectations Of sushcrs.
Leases over Nine Points.
But ;oday's market was not con
ccru"d with intrinsic value. and.
therefore. Mexican Petroleum broke
more than nine points, while ran.
American, which controls II. declined
seven points from the high price OF
cotrospoHd!RGIy bad. although the
petroleum shares a class arc
stronger intrinsichlly than any other
on the board.
Failure OF the railroads to show
permanent Improvement as = result
Of thn rate Increase was due 10 three
distinct reasons. In the hrst place.
most or the railroad securities Of the
country are owned by persons who
have paid FOR them and are In the
class known as the public. SDr,uia-
i've Wall street had large quantities.
which were promptly Cashed In to-
day ON the good ncws. The really
big peoi.lc know that the rate de-
Cisson Is going 70 be ultimately
bullish. bat they have not had any
stocks and would like 10 pick them
up ~ lower levels. Therefore, when
the professionals sold no support was
found. The second reason .or the
decline MAS thc ImDossIb!!!ty Of get
Ting speculative money with which
- buy TIA" rails. The third reason
was the fact that labor conditions
and frcign, congestion are such that
store their properties 10 condition
OF complete efficiency. The freight
congestion ties W. credit tina: tho
railroads need and the labor cond!-
tion VIII make II difficult TO get the
physical work done even after the
Improvement plans are financed.
Ituil Increase iOi Per Cent.
In 1915 the railroads got an In
crease OF - per cent IN rates. When
the government took over the roads
there was an Increase OF 25 per cent
crn roads makes total Increase O!
l0i Ii per cent since the war be.
gan. In addition 10 that. passenger
rat"S were Increased from 20
cents. and now n further advance OF
20 per cent, making them . $40
cents. on top OF which persons whu
ride In Pullman ears must pay AN
additional 80 per cent. or 4-l0 cents
per mile.
The volume OF business in tho coun-
try has Increased materially since
this series o. rate advances began
Therefore. even assuming that IN.
employees do take 100000, 900 more
yearly. there will be enough in the
next year to enable all wcli-manaecl
railroads TO be completely rchab!lI-
;ated and become once more the
backbone of the country. Ii looks
like a new era FOR Industry WIN ef-
ficicnt railroads properly financed and
we'll managed.
American International stock broke
seven points, 10 the new low record
OF ~.
railroad equipment stocks have
been heavily bought by spectators
for many months. IN anticipation of
the Interstate Commerce Commission
announcement. Very naturally. there
fore, thousands OF shares We're for
sale on the good news. and the SELL
Ing of the stock broke all the equip
ments. They declined fully as much
40 md rial