Omaha daily bee., 1921-12-12
Financial
Gbe Nem ncrk @mes.
BY ALEXANDER DANA MOVES


Chicago Tribune-Omaha Bee Leased Wire.
New York, Dec. 1l.-There was
both encouragement and discourage
ment in last weeks financial markets.
That the long-continued rise OF
investment bond prices would halt,
giving place to moderate. reaction
under realizing sales by spectators
who had bought at the early rtumn
prices, was reasonably to have been
expected. But sentiment is wholly
cheerful regarding tine general out
look of that investment market; i
has also been notably encouraged
by the action of foreign exchange.
On the other hand, the declining
stock market has acted as darper
on enthusiasm for, as every one
knows, the general American public
is always apt to take its cue from
the course of the stock exchange. {,
AS whole, the weeks decline in
stocks was no more mysterious than
the apathy of that market in immedi-
ate sequence to such recent Develop
ment at the Washington conference,
the rising bond market. the Irish set
tlement and the advance in foreign
exchange. 1t meant undoubtedly that
the revival in general trade and in
what we commonly cali prosperity.
whether it will come in the spring
or not, is at any rate not yet in sight.
One Fact Overlooked. ?,
The weeIS'g snecuIafiva salItpo ~ r,n
way shares undoubtedly had that In mind,
for. railway gross earnings depend on
activity in general trade. One fact, how
ever, has been rather oddly overlooked
by the markets; namely, that the de-
crease Of Is to 19 per cent from last year
in gross earnings for September. October
much less than the decrease OF to 10
per cent In June and July, because gross
revenues are now comparing with the
period after the Interstate Commerce COM
missions higher ratss had gone into ef-
-rect in September, 1920. ~
AS business revives, the comparison
VIII naturally grow more favorable. Mean
time, even under existing circumstances.
| earnings Of the companies ais whole
almost within half OF per cent of the
per cent rate on property valuation
contemplated in the transportation act.
Exchange Stronger.
The further and emphatic rise in
Cens
trail European countries which are de-
luged with paper initiation, must, in
reason, be ascribed to large economic
| causes The exchange markets view
that rates have advanced this past week
or two because of the proposed moratori-
um for Germany is doubtless correct
enough. SO far as it goes. So Is the Wall
street explanation that sterling must have
been helped by the Irish compromise. such
| incidents have great effect on sentiment
and sentiment is a powerful lever for or
against market in which purely specula-
tive activities are abnormally large
But neither German moratorium nor
an Irish settlement could have put Euro
| pean exchange rates where they are il the
| foreign trade balance Of the countries in
question. their home currency conditions
| and their general economic situation had
| been growing visibly more unfavorable. AS
matter Of fact. the past week has not
only witnessed the remarkable rise in
| sterling. francs and lire, but has seen
| Spanish and Swedish exchange going
above the previous high level Of 1921 and
| the Swiss rate back at parity, for the
/ first time in more than two years.