The New York herald., 1921-08-04
FINANCIAL NEWS
AND COMMENT
Realizing Sends Prices Down
After Some New High Marks
for Recent Upturn.

Traders who had accumulated tidy
paper profits in railroad stocks during
the last three weeks elected yesterday 10
convert part of them into cash. The re-
action or the afternoon. however. fol-
lowed the establishment OF some new
high records for the recent upturn and
net recessions of slightly more than a
point among a number OF leading rails
seemed to disclose nothing except reallz-
ing sales.
| AS the market continued throughout
July to be as highly professional as in
June and May. setbacks are to be ex-
pected from time to time while the true
factors working In the railroad situa-
ton are being shaped. The granger roads
and others which gain most of their
revenue from hauling products of the
farm and forest have, rather generally,
made a good showing in June statements
and traffic records forecast satisfactory
results in reports for July. The broader
test for which investors are waiting.
though. lies in the composite showing of
the carriers during July and succeed
ing months Of the summer and autumn.
The stock market as a whole was
highly irregular. with declines greater
in number than net gains. For the un-
certain trend of steel shares an explana-
tion lay in the weekly surveys of trade
developments. While sentiment in pro-
ducing circles appeared to the Iron Age
as somewhat better than the week be-
fore, due to a slightly higher scale OF
operations in certain districts, the cold
fact OF stagnant iron output was again
depressing.
No more than S64,555 tons of iron
We're made In July, the smallest outturn
of any month in seventeen and half
years. Such a statement indicates a po-
sition from which further recession could
hardly be made without virtually stop
ping the industry altogether.
Judge Gary holds that prices have
gone about as low as they can go. as
many manufacturers are selling steel
below the cost of production. BY the
same token, the July pig iron figures
suggest that output cannot become much
smaller If normal needs OF the country
are to be met. making no reference to
export business.
While steel and other metal prices
have been drawing back it is worth not
ing that the general trend of commodity
quotations went up last month for the
first time since April of last year.
Wholesale prices, as measured by the
products which make up Dun's index
number. were 2.41 per cent. higher on
August l than on July / and are now
about 35 per cent above the average OF
1918. At the peak OF last year they
were 11s per cent. in excess Of the 1913
average.
The fact Of a reversal of fourteen
months price tendency indicates that
the great fall which began in May of
last year carried certain prices further
than demand warranted, although the
more important explanation Is that les
sened production this year has had some
effect upon consuming markets.
1dii IHOHty was quotcu sil - per
cent for all loans and fair demand
was reported. As the Government has
withdrawn this week smaller total of
its deposits from New York banks than
had been expected. the tightening course
of call loan rates from day to day has
resulted partly from Withdrawals of in
terror bank balances. The movement of
rediscounts as shown in the weekly Re
serve Bank statement tomorrow may
cast some light upon the situation.
The foreign exchanges were extremely
dull and rates moved through a narrow
range