Evening star. [volume] (Washington, D.C.) 1854-1972, 1920-08-14
BY STUART p. WEST.

NEW YORK, August 1.-THE indi-
cations are that the uneasiness aroused
over, the so-called Polish crisis and the
disagreement between the French and
British foreign offices has played direct
ly into the hands of the large financial
interests who were anxious to begin
their accumulation of stocks at the low
est possible level Lurid newspaper
headlines and the reckless writings Of
foreign correspondents talking about an
other Armageddon, and a state OF affalrs
scarcely less serious than 1914 frlsht-
ened the investing public and encouraged
heavy short selling at prices which rep
resented a decline of all the way from
80 to 80 points from the high of last
autumn.
This was precisely the situation which
the big men. DESTROYS of picking up bar
gains, wished to see and that they have
taken full advantage of it In the market
Of last week admits of very little doubt
AS usual when a great downward move
ment is eliminating there are certain
last weak points to be cleared away.
The enormous decline has under
mined the position of various pools and
individual operators and this TACT Is
known in banking circles.
1t becomes the final objective OF the
downward movement to force these I'M
fortunates to unload, which they have to
do either because their margins are ex-
hausted or because their collateral is
rejected as a basis for loans
Market Has Rebound.
The market arrived at this last
stage in the early part of the present
week. 1t was not that the supply OF
money was deficient, but that credit
was fatty refused to a number of
speculative cliques. The sudden CALL
ing of these loans forced a headlong
liquidation which caused violent
breaks in some of the newer indus
trials and unsettled for a day or two
the entire market structure. AS usual,
the stocks (which had to be thrown
over at a tremendous sacrifice were
taken by strong people, and with the
objective attained the market had its
inevitable rebound.
There is no hesitation in describing
the present inside position on the
stock exchange as the most solid or
any in years.
Wall street loans are the lowest of
any period since before the war, which
means that fewer stocks are being
carried on margin and larger pro-
portion are owned outright than in
any year since 1914. At this weeks
low points Industrial stocks were SELL
which could be justified by the treas
ury assets behind them, regardless
altogether of current earnings.
In other words, the market in its
great decline from November to Au-
gust had measured the worst posi- :
bilities of business reaction. labor
troubles. high money and excessive
operating costs.
Atmosphere Not Cleared.
The depressing influences in the sit
uation have, to be sure. by no means
passed. 1t is just as hard as 1t ever
was to borrow money for new under
takings.
Business men are having the same
amount of difficulty in obtaining
their ordinary lines of credit at the
banks The deadlock in certain in
dustries between the producers, who
claim that they cannot reduce prices
because this would leave them no
profit, and the consumers. who refuse
to buy at what they say Is a pro-
hibitive level. is just as much appar-
ent as at any time.
But there Is a stage where all these
unfavorable things are finally, dis
counted Just as the market moving
far ahead of outside trade begins to
go down while business is apparently