Evening star., 1921-06-07
HEAVY LIQUIDATION
ON WALL STREET
Bears Raid in Confident Man.
ner-Margin Calling Is
Again a Factor.
BY &. p. WEST,

NEW YORK. June Tt was
foregone conclusion that the severe
break al the close of business last
night would bring into the market
this morning a fresh wave Of selling
from SPECTATORS whose accounts
had become undermined. or else who
were thoroughly intimidated by the
spectacle of one group of stocks
after another breaking into new low
ground
Liquidation Of this sort was suf-
fciently heavy to cause, an opening
nish a supply of stocks for covering
purposes larger than any that has
yet appeared. For the first hour or
so advantage was taken of these
favoring technical conditions to cash
in some of the profits made on the
short side during the campaign of
the last three weeks.
AS soon as this demand had been
satisfied. fresh selling movements
were launched, first in one quarter.
individual stocks went through their
previous low points for 1921. A few
even broke the bottom figures Of the
December prices.
Not Warranted by News.
1t could hardly be said that there
was anything in the news Of the day
to account for this new decline in
stocks. The Ford Motor Company an
nounced a cut of between $25 and $50
d car, and this evidence of an in
crease in competition for new busi-
ness had its effect upon the motor and
related shares. But these were
scarcely weaker than the average of
steels were heavily sold again. antici-
pating further price cuts in their in
duStry, but they. too. went down no
more readily than the general run OF
stocks.
If the sources of the selling could
have been analyzed. -tenths of ii
would probably have been found to
have been inspired. not by unfavor-
able trade conditions. present or
prospective. which have certainly
been largely discounted at the pres
ent level of prices. but simply by the
demoralized sentiment which springs
from the sight. of continuous and
prolonged decline. Oftentimes such
generalization denotes the downward
movements in its eliminating stages
Railway shares.
The majority opinion of the selling
Yesterday and today in the rails was
that it was a daring raid against
weak technical position. rather thah
a selling movement inspired Dy gen
uine fear of a strike. Railway shares
had stood up stoutly under the strain
of nearly two weeks. of continuous
decline in the industrial group. wall
Street houses had been practically
unanimous in their advice to buy, and
a great many small spectators took
this advice. impressed by the way
these stocks held their ground.
The consequence was that weak
speculative account developed and pre-
sented a target for the victorious bear
crowd to shoot at. From a\bear stand
point. the psychological Affect of a
break in the rails. which had here
tofore been the backbone of the
market. was we'll understood. 1t was
calculated to give the impression that
bear operations were invincible and
could take my group of stock at will
and breakokhem.
American Wool.
One of the best acting stocks on the
list was American Wool. ThiA is one
company which has completed it's re-
adjustment and has got bAdk to
position where production is running
well above 80 per cent. 1t was pointed
out last week that the dividend on
Wool could be considered safe, and di-
rectors yesterday declared the regu-
lar $175 for the quarter. Orders are
reported coming in at an increasing
rate, while the company is also in good
financial position.