New-York tribune., 1921-03-28

Wneu QuOt3tlOnS OF TAllrO0Q and lnQu0-
| trial stocks SCARED in the busiest day
at the Stock Exchange thus far in 1921.
The upturn was rapid and reaction,
caused by profit taking, came before
/ the session closed and continued on
Thursday, which marked return to
the prevalence Of conflicting move
ments which had blurred the picture
Eearlier in the week. The market was
closed on Good Friday and irregular
on Saturday.
Obviously, the domestic and foreign
tangles which depressed sentiment and
prices have not Of sudden been
Strengthened out. Yet, on the other
hand, it must be recognized that sew
eral industries which were most
severely affected by the readjustment
are now showing signs Of reviving.
Reports from the automobile trade In
.dicate that there has peen an indus
trial basis for the recent activity Of
the motor stocks. The turn in that in
dustry came about the middle Of Feb
ruary and tho strongest companies
have reported . progressive improve
ment since that time. The gains, which
are impressive when compared to the
dullness and gloom that prevailed
toward the close Of last year, came
mainly in the passenger business, as
the demand for trucks Is still slight.
Motor trucks will be wanted in proper
ton as business generally improves
and the demand for transportation ex-
pands. Improvement in the spring is
seasonal, but many automobile men,
perpetual optimists, believe the up
ward trend will persist. A better sem
timent prevails in the textile markets,
too. But after the crashes of last
year. caution pervsdes most business
circles, ana 1t is not unnatural to per-
ceive reflection Of this psychological
attitude in the stock market.
In the annual reports Of corporations
which are now being sent to stock
holders an explanation Of the sinking
spell periods in the Liberty bond mar
kets appears. Most Of the huge insti-
tutions show that their holdings Of
Liberties were smaller on December
81, 1920, than on December 81, 1919.
With credit dear and difficult to OBJ
tain last year, many corporations
helped finance themselves by selling
their investments in government Sc
curities. They reasoned it was better to
cease lending to the government at
low rates than to continue and boryow
themselves from the banks at high
rates. In many instances there was no
opportunity for nice reasoning 1t was
necessary to get cash. The effect Of
these tremendous unlosdings was ex.
pressed In periodic breaks in the price
Of Liberty bonds. Many investors be-
came worried as quotations sank. But
the discerning knew that the decline
represented no impairment of the in
trinsic worth Of the securities. The
new annual reports supply the data to
confirm this view.
| Speculative credit was in more liberal
supply last week. The renewal rate
at the Stock Exchange cropped to 6h
per cent, the lowest since the latter
part Of January, when a 6 per cent
quotation prevailed; but the Stock Ex-
change call money has been offered
recently by lending institutions which
could not place their funds through
the regular channels, and loans were
| arranged on q small scale at i per
cent basis. The prospect Of lowering
of Stock Exchange rates under the 6
per cent level in the near future seems
slight, in the opinion Of financial OBJ
servers, who hold that to do so might
result In heavy transfer Of banking
funds to the interior. AS is we'll
known, interior banks carry large bal