The New York herald., 1921-04-05
FINANCIAL NEWS
AND COMMENT
Stock Market Is Still Irregular
as Uncertainty on Rail Sit
uation Continues.

Lacking any tangible influences TO
move it In either direction, the stock
market yesterday continued the irregu-
lar tendency which ruled all OF last
week. In this there was a need OF
disappointment for partisans of the con-
structive side, for the strong position
Of the Federal Reserve system disclosed
in Saturdays report was expected to
have at least little force on sentiment
But analysis OF the report in detail
nary Improvement OF the New York
Bank caused by heavy additions to the
gold holdings. much must still be done
10 draw closer together the relation be-
tween reserve and liabilities of the
banks especially affected by slow move-
'ment of merchandise and farm products.
The New York Banks gold reserve was
expanded chiefly by the transfer of
sec. 1000 to the reserve agents ac-
count a step impelled by a reduction
Of bill holdings to point where It was
necessary to increase the collateral be-
hind Federal Reserve notes outstand-
Ing and held in the banks vaults. The
cutting down of rediscounts reflected the
unusual scale at this time; but the fall
OF prices and desire in some farming
localities to reduce crop acreage this
year may change the usual spring move
ment of money. The call loan rate
again opened at 6h per cent. held at
that figure for most of the days ar
rangements and eased off to per cent.
later. A lower rate was quoted in open
market loans
The passing of the American Beet
Sugar Company's common stock divi-
dend caused considerable selling of
sugar shares. and the day was marked
by fresh bear drives at Mexican Petro-
leum, but outside Of these bits of as
certed pressure. and before the close fair
rallies occurred. Strength of Studebaker
and three or four other industrials, in
which large short interests are believed
to exist aided in supporting the other
motor and tire shares. The railroad de-
partment did very little.
There is no doubt that uncertainty
over the railway situation is the sub
ject OF chief concern to the stock mar
ket at the moment. The financial COM
munity is hoping that some such devel-
opment will mark negotiations from now
on as appeared to change suddenly the
entire complexion Of recent packing
company differences with labor. Pro-
ing to admit the decline Of living costs
and the fall Of railroad traffic call for
concessions on their part, 1t Is conceiv-
able that discussions being conducted
by President Harding and Government
railway authorities with railroad labor
representatives will bear fruit. But
whether the deadlock over wages Is to
be broken at Washington or through
action by the Railroad Labor Board. 1t
\ Is high time that a decision Is arrived
at. The country's business structure is
threatened seriously by an impossible
railroad situation. Only through re-
duction OF operating costs can there be
hope OF a cut OF freight and passenger
rates, and at that competent railroad
statisticians calculate that the current
volume of traffic would make return
OF no more than 4 per cent. on the rail-
way investment IL the national wage
agreements were cast overheard and a
wage reduction OF 20 per cent put into
effect besides. colncident with 20 per
cent cut OF freight rates.
Sterling exchange lost a cent and
more. speculation for the fall being
urged by the graver aspect Of the coal
strike in England. May wheat gained
l1h cents a bushel and the July con-
tract declined cent. Cotton naturally
was depressed when the British market
suffered rather sharp setback. but the
movement in New York was irregular.
neither decline nor subsequent rallies
being very extensive.