The New York herald., 1921-06-21
FINANCIAL NEWS
AND COMMENT
Wave of Liquidation in All
Markets Leaves Lower
Prices in Wake.

A wave of liquidation and short sales
swept yesterday through the financial
markets and the markets for commodi-
ties as well. leaving sharp price de-
clines in its wake. In stocks the move
ment, while merely a continuation of
what had been going on for six weeks.
was furthered by a greater paucity OF
buying power than had been seen be-
fore and heavy selling spread over
practically all departments. A turnover
well in excess of 100000 shares and net
recessions OF to more than points
told the tale in this market of much
unsettlement. Plentiful supplies of call
money and rate of per cent in the
afternoon-the lowest quotation on the
New York Stock Exchange since April
6-were facts ignored by the speculative
element. A stage In readjustment
processes so pronounced as that re-
Elected in the markets forecast a rapid
ment. as during last week. took little
account OF Improvement in particular
industrial lines and was inclined prob
ably to lay too much stress on unfavor-
able factors.
In so far as professional pressure
against prices had a part in the mar
ket there will come. sooner or later.
natural correction But a reason why
the short sellers have had things so
much their own way of late lies In the
absence of broad constructive influences
in Industry and commerce. 1t is seen
now that the original method Of han
ding the German reparations, provid-
ing for large initial payments in New
York, has worked very much to the
detriment of undertakings in foreign
trade Merchants In all countries, be-
wildered by rapid fluctuations of ster-
ling. francs and other European ex-
change rates. found during the last half
of May and the first half of June that
fers of goods were in the nature Of
gambling operations. and naturally they
have elected to curtail activities. While
it is believed that the Preparations Com
mission will now handle the situation
differently. arranging for payment In
several currencies and in goods, It
stands to reason that some time must
elapse before the exchange market will
return to a normal situation. Sterling
receded yesterday az cents to the
pound, going to S.7s7s and declines Of
other rates were substantial, including
rates on South America.
The financial community is devoting a
great deal of attention to the railroad
situation. not more because of the rather
unexpected weakness of rail shares In
the last few days than for the reason
that on July 1 reduced wage payments
will begin to have effect in income ac-
is coming through the depressed con-
dition of foreign trade Is influential
also in railroad earnings. 1t is not too
much to say that the future of railroad
income is definitely bound up in the
| ability Of foreign buyers to acquire
goods in the United States, which car
ries its own suggestion of need for
making the exchanges more stable and
for increasing credits here for purchasers
in other countries.
Cotton futures declined to new low
records, the several options falling 35 to
30 points following a broad reaction on
the Liverpool market. The disorganiza-
tion Of British industry and commerce
as the result of the long coal strike and
textile difficulties threatens to be slow
in working into better things, but the
outlook is reported as better. Wheat
fell at Chicago about cents bushel.
recovering practically half the gross de-
cline before the end OF the day. That
market evidently was unsettled by pros
poets OF large deliveries next month, al
though the new crop outlook is not al
| together promising.