The New York herald., 1921-04-25
FINANCIAL NEWS
AND COMMENT
Rise in Stocks Reflects En-
larged Production and Bet
ter Trade Conditions.
HOPE IN FUTURE Is SHOWN
Readjustments Made in Many
Lines, With Rail Problems
Still a Deterrent.

ness to follow during its progress into
and out OF periods OF depression, II
would be comparatively simple matter
to determine what last weeks strength
of the stock market meant. But the
changes in manufacturing and distribu-
ton are heralded usually by signs whicn
are often ignored until the alteration
from one epoch to another is well under
way.
Thus hindsight shows that the re-
hellion of consumers against extraor-
dinarily high prices foretold In June
and July OF last year the great slump
OF industry that was on the way: but
holders Of stocks were only reluctantly
persuaded Of the actual situation along
IN the autumn. Then violent declines
Of security prices reflected q season Of
liquidation of all sorts that had been
months IN the making.
The reason countless owners OF stocks
and possessors OF goods for market were
rnready to accept the forecast made by
tight money and dwindling demand for
manufactured products in the spring OF
1920 was the continued impetus OF the
| boom Of 1919. 1t seemed to many that
the world had entered an era of per-
sistently high prices. high wages and
heavy consumption which would run a
long time.
situation of business and of sentiment
regulated by business had appeared TO
be exactly the reverse of what 1t was
.ast June. The continued fall of com
Inodities prices, the yielding of wages
here and there, the shrinkage of buying
power at home and abroad seemed to
have no end that could be established
| in terms of weeks or months. Nor Is it
ossible now to say that any particular
month or quarter of this year will find
business expanding broadly.
Indications of Renewed Life.
But there have been indications of
renewed life in some departments of
production and trade. and such i'm
provement as has occurred has found
degree OF reflection in stocks. The
automobile industry was discovered in
March to be climbing from the depths
OF inactivity, the record being com
prised not only In the employment OF
many idle men at the leading centres,
but also in a growth of buying Of steel
by motor car makers. The automobile
stocks did not respond Immediately, out
several OF these issues were the back
bone of last weeks market The hasty
retirement of the short interest, or new
speculative buying for the rise-what-
ever the quality of purchases-shoTed
the entrance OF new forces into INDUS
try
signs Of a turn in the petroleum mar
ket, designated by an advance oi
Pennsylvania crude oil last Monday.
were almost Immediately availed or by
speculators in the oil shares. In the
motor and oil stocks 1t was evident
that impressions of an improving busi-
nass prospect made an appeal whicn
found answer in recoveries of 10 10
noints among those issues when pre-
vioualy had been sold most extensively
for the fall OF prices.
Thase facts were evident to any one
who examined the share list ana sur
viewed the day to day news from the
industries involved. Yet the absence OF
formulate for general prosperity or
comnrehensive business expansion made
the stock market as whole diuicult
of analysis.
Speculative activity in one or two
groups OF stocks is wont to arouse m
terest IN others without always having
the fun support of altered economic
conditions. So 1t was possible that the
sharp advances OF railroad and steel
shares In late dealings of the week,
after several days OF uncertain price
movements, indicated little besides
syrnpa thetic reduction OF the short ac-
count induced by the rise OF other IS
sues.