New-York tribune., 1921-03-12
Stocks Decline
TO Years Lows
In Active Mart
Increase i'm Business Made
at Expense Of Prices;
Real Liquidation ON
Rail and Tax Problems

For the third time thus far in 1921.
which has consisted of q series Of dull,
inactive market sessions, transactions
in stocks at the New York Stock Ex-
change yesterday exceeded 100000
shares. The escape from the period of
iistlessness was made at the expense of
prices. The transition from an almost
entirely professional market to one in
which outside participation has been
greatly heightened, change which be-
gan to manifest itself on Thursday, has
brought about measurable quantity
of real liquidation.
With the first installment Of Federal
taxes for income obtained during 1921
due on Tuesday, it is reasonable to as
sumo that at least q part of the selling
originates from taxpayers in quest Of
cash. However, q more moving factor
Was the alarm over the railroad stua-
ton, capitalized by energetic efforts of
professional spectators for the de-
cline. Announcement of desire to cut
wages by leading railroads in various
rarts OF the country was not of itself
unfavorable to market values, but it
So NSN ~ iONuS s~ttcuLlOu OU IHS CTlIi-
cal position of the roads, which are, as
whole. failing by far to earn 6 per
cent on their property valuation, which
Congress in the transportation act OF
1920 defined a fair return.
Aside from the broader social values,
ordinarily the news that the roads were
planning substantially to reduce ex-
penditures by cutting wages might be
greeted as favorable. But, under the
L ~.
the management of the roads must
take up their proposition with the rep
resentatives of the workers, and, fail
ing to reach an agreement, will have to
teke the matter before the Railroad La
hor Board, before which both sides will
have an opportunity to appear The
uneasiness of spectators who have
been rushing to get out of their COM
raitments for railroad stocks presuma-
bly, is based on Che fear that the roads
will be unsuccessful in their attempts
to liquidate wages, and that the roads
are moving into still more critical Pc
riod. Evidence to the effect that this
theory is i'll judged probably would
cause a rapid rebound in the specula-
tive issues.
But, aside from the outcome of the
wage issue, the fact remains that since
the period OF government guaranty ex-
pired the earnings of the roads have
been far from satisfactory In the last
four months of 1920 the Glass | roads
earned, according to the compilations
of the Bureau of Railroad Economics
3.3 per cent, and the indications are
that the results for the early months Of
1921 will be still less roseate.
Although from the start pressure
was again exerted on rail stocks yester-
day, and such standard issues as Penn
sylvania and New York Central broke
sharply, the selling of industrial stocks
on a large scale, particularly the oils,
later held attention of traders. Steel
common dropped to the lowest level of
the current year, and many other ac-
tive issues established new marks of
depression for 1921. The vigorous de-
cline brought The Tribune's averages
of twenty railroad stocks, thirty indus
trials stocks. and fifty stocks to the
lowest marks of the year. That of
twenty rails yesterday fell from 61.20
to COLO, and that of thirty industrials
from 1913 to ITO.
In the foreign exchange market rates
on the European capitals were shade
easier, with the exception of those on
Berlin. Grain prices dropped markedly
lower, and cotton prices were a trife
easier.