The Bridgeport times and evening farmer., 1920-03-16

the value of the roads. This opinion would not have anything like it's pres l ent significance were it not for the fact that the transportation act just adopted by Congress requires the Commission to base it's new rates upon an assumed standard return of about 1-2 per cent. to the rail- roads, estimating this return upon their physical valuation. This makes the real point in the whole rate-mak- ing controversy rest upon the footing that is given to physical valuation.
 Under the opinion of the Supreme Court, however, that valuation ap-
 pears to be fairly well defined and
 the result has naturally been to en- courage the upward movement of
 railroad stocks in a very decided de- gree.
 The outcome of the decisions has thus been of profound importance to the market not merely from a tenn porary standpoint but in long-range
 sense.
 Indeed as the days have gone by, [ the market has been inclined to give more and more significance to the two opinions, and, particularly, to the Kansas City Southern finding as | price, making factors. Following, as 1 they do upon the decision in the steel
 case, they have undoubtedly exerted
 a far-reaching and permanent effect
 upon the whole investment and spec
 ulative situation
 Money and Exchange
 It has been an encouraging factor
 that coincident with the conservative
 attitude of the Supreme Court there
 has been a turn for the better in
 money and exchange conditions. Call | funds, which had been apparently begged around or 10 per cent week l ago, have ruled around ' to per cent during the past week, with a 1 decided downward tendency. v ewa1 rates have been distinctly easier and there have been symptoms of better nent in time funds both as to quan- tity and rates, transactions taking place as low as S-9 per cent. On the other hand a strong upward movement
 in foreign exchange has set in, follow ing directly upon the better money
 situation and upon the growth of a belief that a very substantial sum in gold will soon be transferred to the United States from Great Britain. Re
 ports that already s125, 100000 have
 been earmarked for shipment to this
 country lack confirmation, but have
 been quite generally accepted as cor
 rect.
 The rise of sterling exchange to
 S3.S6 at one time has continued the stronger movement of a week ago and while other European currencies have not done as we'll all of them are m a very much better position
 than for a month or so past. The , reserve ratio in the Federal Reserve system, although not materially ; stronger, held it's own and made g . ! eli at ha a Sf T1f there are evidences that the sever, , contraction which has taken place ir , the New York district will be para1 f leled in the interior of the country
 These conditions do not imme meddatel. promise any relaxation in the high dis
 count rate policy of the Federal Re g serve Board, but they show that fac ! tors making in the direction of tht
 improved conditions are definitely a 6 work. The transfers and release O
 funds which will occur on March IS as a. result of income tax payun nent: f and the settlement of outstanding cer z i tiffcates of indebtedness, may have = l temporary influence in relaxing tn = strain to which the money market ha ' been subject, although genuine i'm u provement in that regard will be matter of much slower growth.
 Market Review and Outlook
 Very decisive advances, both in in dustrials and rails, have been tn ,h characteristics of the weeks marke1 l. The upward movement started inme Il diately after the announcement of Nh decisions of the Supreme Court O ' Monday last and has continued wit 'l but little Interruption until the pres ent time. Para1le1ed as the move
 ment has been by easier money an cI better conditions in exchange it fore Is shadows a very hopeful prospect. IS Quotations for most stocks are sti SC comparatively low; this is particular n ly true of the rails and of the copper Is which represent an important part ( m the 1istings. The Steel stock dividen f' and rail appraisal decisions by u lg highest court in the land remove u ty rro ertainty regarding these importal - tiers which has been hanging ov, ,1l l. market for such long period le pointed out heretofore, of the thrt us decisions the most far-reaehing is tn Id appertaining to the railroads, as r O. placement values of today will mate eh ially swell the assets of the compa ht les on which 1-2 or 6 per cent W ag be allowed. Up to the present tin