The New York herald., 1921-10-17
FINANCIAL NEWS
AND COMMENT
Industry and Trade Look to
Rail Rate Reduction for
Needed Impetus.
MORE LINES IMPROVING
Public Apathetic in Stock Mar
ket Owing TO Economic
Uncertainties.
MORE LINES IMPROVING

At the threshold of what promises -
BE- n winter of great financial and busi-
ness events. il is worth while consider.
ing some of the factors which will have
to do with the trend OF things at homa
and abroad. AT home the country Is
graphing with the railroad problem.
which, while always present in one fo,r,
o: orother during the last Gecade-since
the Interstate Commerce Commission
threw barriers in the way of rate IN !.
cresses-it is more acute now than be-
fore. This Is SO because decisions t.
be reached on freight rates and wages
viii! affect the carriers themselves
hardly more than they will affect in
dustry and trade.
The country is awaiting a genuine
stimulus to business from the lowering
of freight carrying costs. 1t is quite
likely that many shippers are expecting
more to result from cut than actually
will appear when rates go down; bn.
quite aside from the application of ..
lessened freight charge on coal or poia-
toes or shoes. the fact is evident IA
comment everywhere that business sen-
timcnt will be cheered when an APP
proach is made to the rates of two
years ago.
As far as the relation between rates
and wages is concerned the present Is
not the time to predict what is going
doubtedly have prepared for an en-
oroachmant upon wage schedules am
will fight to retain them. The tale Of
railroad earnings from month to month
shows plainly enough that solvency for
many lines under reduced rates canno.
be maintain without a parallel fall Of
costs, and the logical place to begin to
wliittle is in the payroll.
End Cannot he Predicted.
But 1t cannot be predicted yet just
how concessions VIII be worked OUT.
The history of dealings between rail-
road employer and employee in the
past avails little in examining the cur
rent situation. for the reason that ma
chinery supplied under the transporta-
ton act OF 1920, TO degree, does away
with direct negotiation between the in
terested parties and puts responsibility
for action upon the Railroad Labor
Board
FActors more tangible than rail wage
discussion. with reference tc future hap
penings in business, are contained in
money and credit. the foreign situation.
the commodity markets and the markets
for basic products All Of these except
lie second assuredly are more satisfac-
tory than they were a year ago The
steel trade in October. 1920. it is true,
was going along under practically a full
head OF steam. The mi,ls were busy
and were to continue so artil along ii,
January. But the great slump OF tex
tiles. grain and cotton, among other
sources OF wealth, had made such tre-
mendous headway between April and the
end of September that every one knew
that steel could not esca oc the effects
OF dcflation. Since July ttcre has been
a recovery in this industry which. while
slow and highly iregula.. Is neverthe.
less SO well established ia records O.
prices. bookings and enla -eed plant ac-
.ivity as TO forecast even retter things
before many months have rdssed.
About all that need be said about
money has been said since Federal Re
serve rediscount rates began to decline
last spring. Agricultural loans are be-
ing paid Off .'apid.y. In n any lines Of
manufacture .he reduction Of merchan-
disc stocks during all of this year has
seen the proceeds applied against loans.
Instead OF suopler,enting now loans in
the purchase ~ new stocks at constantly
Using prices. as was the case In the la
mented year OF 1919. TIE well main
tained strength and breadth of the bond
market since the middle % August has
been sufficient baromc, ,a.. of the ten
iency OF money rates. TIL. demand Is
wide and has as Is real foundation the
impi essien OF investors large and small
that the way TO insure the return of
10 per cent. for years IL como is to
buy securities before money rates
chearen
Foreign situation In n Drar.s
The foreign situation is oue OF the
greatest drawbacks 10 cons.ruct,va
business enterprises. The fall of the
German mark last week to a new low
record OF 66is of cent was reflective
more OF n puzzllng and disturbing fiscal
policy in that, country than of the
direct stress OF repnrations payments.
Tho v-.!1 .csrs that Germany is fol-