The New York herald., 1921-12-14
FINANCIAL NEWS
AND COMMENT
Exchanges Reaet-Sterling Is
Down 4 Cents-Stocks
Have Active Day.

1t was natural that the fortnighfs g
sharp recovery of foreign exchanges.
eliminating in the great strength OF
! Mondays quotations. should have
caused offerings of bills to expand
when business got under way yester-
day. The product was a reaction OIL
more than four cents In sterling and
an equivalent retreat OF francs and
other Western Europe rates. In seek
ing for explanations for the movement
OF the exchanges. the financial COM
nunity had nothing more to work with
than before. but Mondays upturn of
rates unquestionably strengthened the
! impression that the fiscal position of
! certain European countries had inn
proved measurably in the last three
months A rumor that the Preparations
Commission had approved a proposed
international loan to Germany. amount
ing to s1,Ooo,OoO.oOo for fifty years. was
| viewed as interesting but incomplete
because no data about means for ac-
tually raising that vast sum were pre-
sented.
The day In the market was active,
but rather uninterestIng. because of
the contrast OF events with those ex-
| traordinary ones in exchanges and
cotton statistics on Monday Stocks
were stronger and considerably more
active than they were on Monday but
| footprints of professional traders were
! found all over the market and no new
Indications OF public participation de-
veloped. Just as inventory values had
a great deal to do with the decline of
share prices last spring and summer
so also was the course of rubber. cop
| per and oil stocks shaped yesterday by
| stiffening commodity prices. except
| that yesterdays movement was up
ward. The short interest received q
severe drubbing In Mexican Petroleum
as did its companion stock. REn-
American Petroleum. and there were
! evidences OF an uncomfortable short
| position in Crucible Steel. With the
exception of those shares, the market
was about the same in character as
| those of the last three weeks. Pre-
| ferred stocks responded to a slightly
| firmer tone OF bonds. especially of
! Liberty issues and those of several
foreign Governments. Call money was
at five per cent for all loans. little
easier than it was on Monday.
From now until the end of the year
the money situation promises to supply
subject worthy OF considerable study.
Thus far In the autumn period. the ex-
perience of normal years has not been
stead of growing larger. The basis of
the change of course, has been tho slug
gish state of general business. But
merchants report a fairly satisfactory
that factor should be seen in the next
two weekly Reserve bank reports. Cir
cplating Reserve notes increased about
/ s7,00o.00 In volume last week. There
presumably has been some recourse to
the loan market this week on account
Of the December income tax and excess
profits tax installments and other Gov
ernment transactions tomorrow are
likely to disclose a growth of loans. II
events show that seasonal requirements
have been met without any extensive
check in the country's loan contraction
the outlook will be fairly clear for easy
money and credit in the forepart OF
1922.
Cotton prices yesterday stood up In
rather surprising fashion in the light
of Mondays Federal crop estimate.
Fluctuations OF futures quotations were
moderate and they left off with small
gains. 1t is probable that traders and
manufacturers are watching closely the
incipient signs OF improving conditions
in Europe and are not pushing hedge
selling or short sales until further in
formation on consumption is obtainahle
Wheat recedcd slightly.