Indiana daily times. [volume] (Indianapolis [Ind.]) 1914-1922, 1921-09-26
STOCK MARKET
GROWING MORE
ENCOURAGING
Reduction in Money Rates and
Steel Improvement Are
Examples.
RAILS SHOW EARNINGS
Special to Indiana Daily Times
and Philadelphia Public Ledger.
By MONITOR.

Special to Indiana Daily Times
and Philadelphia Public Ledger.
BY MONITOR.
NEW YORK, Sept. 26.-Price move
ments in the stock market in the last
week have reflected the hesitancy of most
operators to enter into extensive engage
ments or to commit themselves TO any
big turn. IN fact, the only significant
tendency has been in the investment di-
vision, where bonds have been rehecting
the stimulating influence of cheaper
money, both for short and long maturi-
ties. Just when this factor will express
itself in the so-called speculative issues
is dependent on the improvement in in
dustry and general business.
Although the situation still abounds
with cross currents the dominance of the
encouraging features is becoming more
pronounced daily. while those Of IN
favorable character are losing some of
their potency. Among the former is the
reduction rate by the Federal Reserve
banks. So far as the speculative position
Of the market is concerned. this is not
a factor of prime Importance, but it
should continue to have a further stiff
fleming influence On Investment issues,
particularly Liberty bonds. From bust
ness standpoint. the more hopeful turn
in the steel industry seems to be moro
clearly related to the economic require
ments Of the present situation. Opera
lions are on a scale Of 80 per cent over
July as a result Of new orders for sheet
steel and wire products.
DUE TO CUTS RATHER
THAN INCREASED TRAVEL
The improved showing Of railroad
earnings in August may be set down
rather to reduction in operating expenses
than to any increase in traffic. Never
theless the statements Of Union Pacific,
Southern Pac ific and Kansas City South
ern indicate that the extensive economics
have been sufficient 10 enable the car
rIers to show comfortable earnings de-
spite the relatively low gross This is
evidently a tendency that will be dis
played by most railroad statements,
with the possible exception Of some
Southern lines. If, in conjunction with
this demonstration of the beneficial eff
fects of managerial economics. the Gov
eminent should make its settlements
with the roads and furnish them with
funds, the favorable reaction on the
steel and equipment companies might be
most pronounced
The strength Of the Mexican bonds,
notably 81, reflects the hopeful attitude
in reference TO our relations with the
Southern republic. Recognition of the
Mexican regime undoubtedly would be
the signal for widespread industrial ac-
tivity south Of the Rio Grande. The
effect on the oil industry would be
marked. mining operations would be on
an enlarged scale. and the developments
of the splendid agricultural regions ad-
Jacent to the line of the Southern Pa
ci1c in northern Mexico would mean a
great deal to the worlds production Of
raw material.
Other factors in the situation of an
encoura ging nature consist Of increas ed
production in the textile Industry and
thef moderate upward tendency in com
.sS5odity prices, the sole exception being
cotton, which, Of course. has had q sen
sationa1 advance as a result Of the ad-
mitted crop shortage. OF course, II COM
modify prices should rise TO an extent
that buyers would be induced to halt
in their of take the effect would not
be beneficial. At present. however, the
price gains merely serve to relieve the
position of certain groups Of producers.
giving them increased purchasing power
and enabling them to improve their inan-
ciaI position
EUROPE NOT IN
SHAPE TO BUY.
Such favorable factors as these are
Offset to a certain extent by extensive I'M
employment and the unsettled European
economic and financial conditions For
mer Postmaster General Burleson arrived
from Europe at the end Of this week with
e rather lugubTious tale. He had been
delegated by a group of southern cotton
producers TO sell lot of cotton abroad
Upon his return, he confessed his fall
ure which he was inclined to attribute
to European inability to buy. There is
another side Of this story. however. Ex-
perlenced cotton merchants are able to do
business with European cotton consumers,
and transactions Of late have been on n
very large scale. Consequently, Mr.. Bur
leson's statement may be more an admis-
sion of personal disappointment than n
reflection Of actual conditions.
In spite of the interplay Of favorable
and Gnfavorable elements in the situation,
the country. and the world, too, for that
matter, must make up It's mind to the
certainty that the process Of readjustment
Is going to eliminate q great many units
IN production and distribution that were
the mushroom growth Of the war and the
boom period Immediately following. Hun
d Feds and even thousands Of concerns en-
barked in manufacturing or other activi-
ties without experience, capital or estab-
1ished connections, and for a time piled
up large profits. They are being grad
uauy eliminated, and this process OF elm
inatiOn extends even TO certain minor
Industries.
The situation will be no worse for this
wedding out as the world evidently IS
entering an epoch where only the nttest
are entitled to survive.
SO far as speculative sentiment is CON
cerned. there is a disposition to regard
the outlook as greatly confused. Those
who are now operating IN the market
believe that risk is minimized by the
purchase Of the shares of well managed
railroad companies and standard invest
ment issues. In other words. there is a
tendency to play safe, and this policy
appears to be justified under the circum-
stances.-CoDyright 1921, by Public
Ledger Company.