Evening star., 1921-12-12
EXCHANGE
WAS MUCH HIGHER
Result of Ten-Year Peace
Pact-Stock Market
Lacks Trend.
ny STUART r. WEST.

ldCkS ITeIIu.
RY STUART r. WEST.
NEW YORK, December 12.-Every-.
thing else in the financial situation
today was overshadowed by two
striking eNsodes-first, another ex-
traordinary advance in the foreign
exchanges. and, second, the grea,
strength in most OF the securities OF
the governments that are parties to
the fourpower agreement in the Pa
cific
These movements. OF course. regis
tered the judgment in International
banking circles OF the importance for
the future peace OF the world OF last
weeks happenings at Washington.
Japanese bonds rose over two pofnts.
the city OF Toxic bonds were almost
equally as strong. United Kingdom
of Great Britain bonds Of the series
Of 1929 were up nearly two points and
those of the 1887 securities q point
United States war bonds also went
higher, although on account of the
had during the last month, their gain
was not as marked.
The upturn in the exchanges was
fairly sensational, sterling leading
the way with another ten-ceA jump.
which brought the advance within
cents in the pound. In fact, at today's
high, sterling was back more than
half way from the extreme low Of
August to the normal par Of s4.SS.
French francs. which only two
weeks ago. were selling below $50.
were today quoted around SEQ. Italian
lire. Belgfan francs, Dutch guiiders,
Spanish pesetas and the Scandinavian
currency rose with equal violence.
Speculation has played such
prominent part in the fluctuations Of
the exchange market during the last
three years, since the European gov
ernments withdrew their artificial
support. thar II is altogether possible
that this recovery will prove to have
been excessive. Certainly, it Is hardly
justified by such decrease as has oc-
CURED in the British merchandise
imports. and IT is quite out Of keep
ing with the French trade returns.
which have shown. instead of excess
imports. Il return to an import sur
plus.
The enthusiasm shown in the eX
changes and the movement OF foreign
government bonds over the accom-
plishment at the Washington confer
epce was only very feebly reflected
in the security market Of the day.
Securities Lack Definite Trend.
Both bond and stock prices We're
very irregular. Europe appeared
more prominently on the buying side
than on any day so far, which was
logical enough development in view
of the rising value of European cur
rency in terms of the dollar. But the
London and Amsterdam buying was
not much of a factor.
In the early part of the day the
copper and metal stocks were bid up
TheS.
advances, however. were not sustain
ed as a rule. There was good deal
of profit taking in the steel and equip
ments, which had been the favorites
weakness appeared in the railway
group.
Europe Buys Stocks.
Houses handling orders for foreign
account reported that, for the first
time. London was actively buying
American stocks today. This. OF
course. was the logical result Of tn.
rise in sterling Saturday and again
this morning. Inasmuch as the pound
buys more dollars than it did. all
securities quoted on a dollar basis have
become more attractive in English
eyes. Union Pacific was one OF the
! higher priced stocks which London
was picking up. There was also quite
bit of English buying in some of
responsible for the upward move in
Royal Dutch.
Rail shares Heavy.
Toward the close of last week and
again today there was very notice
able selling in the railway stocks.
| especially some of the lower-pr1ced
| non dividend payers. The reason was
! stocks of companies that are doing
very well in their earnings were
quite definitely weak. 1t now ap-
pears that much Of this selling has
been for the purpose of recording
losses for the income tax report The
can be no more selling out and i'm
! mediate repurchasing of stocks The
seller must wait for thirty days be-
fore buying back. A typical instance
was st. Louis Southwestern preferred.
The full ) per cent dividend is be-
ing earned with a comfortable bal
ance besides for the common. There
was no reason. therefor. SO far as
earnings are concerned, for the de-
cline in the stock to around 81. But
preferred was in the midst OF its
move up to 40 and people who bought
at that time have losses now which
they can set up against their taxes.
CAile Copper.
The street was full of bull talk on
Chile Copper and predictions of an
immediate advance made good despite
the suspicious fact that they were
very general. A pool is at work in
the stock and it is in charge Of one
of the most experienced operators in
the street. u veteran in the handling
of big floor operations. There is moth
ing in the Chile Copper situation par
ticularly to differentiate it from that
in other of the copper companies. AS
a low cost producer every advance in
! the metal around present prices means
a good deal In the way OF increased
profits. Another thing that has i'm
proved it's position greatly is the fall
in shipping rates and the abundance
of tonnage now available. All the
South American mining companies
| were badly handicapped during the
war by the scarcity of freight room.
The strength of Chile Coppers
financial position was demonstrated at
the time of the $40.000,000 copper OK
port association notes last spring
when it elected to take its share of
the proceeds in notes instead Of cash.
LONDON HAS APPLE GLUT.
NEW YORK. December 12.-Sup-
v>liac ~ opplas and mara on the Lon