The Washington herald., 1921-06-29


by recounting the numerous things
that could give pause to the pro-
fessional element and stop the
liquidation of long stock. Among
the possible developments was the
settlement Of the BrIsish coal
strike. When the stock market
opened this morning the Street had
positive assurance from official
British sources that the miners had
agreed to go back to work. Yet
beyond a moderate rally at the
opening the market did nothing to
register any qualification with the
healing Of this sore spot. Even so.
stocks were no more reluctant TO
respond to the strike settlement
than they were TO reflect its com.
mencement three months ago.
What happened in the railroad
section of the stock market cannot
be said to have had any relation to
the British coal strike About ten
days ago when the Street nrsi
heard that President Harding was
considering the advisability OF
funding the debts of the carriers
to the government more than one
market expert ventured the opinion
that the consummation of any such
scheme would cause an immediate
rise Of 4 to 6 points in the railroad
stocks. Washington dispatches pub
lished in the morning papers left
no doubt that the administration
has made up its mind to accept ten
year bonds in lieu of immediate
payment of the governments
claims. Yet the markets response
was far from the minimum rise
predicted when the plan wcs first
mentioned The reason was plain
enough. The administration's ac-
-quiescencc did not come overnight
The stages of its development had
been reported in the Street and re-
suited in the rails as a group main
tanning a fairly steady tone under
market conditions which would
otherwise have made them share in
the declines of industrials. Part of
the response of the rail stocks,
therefore was negative. part Of Il
cumulative and the remainder a
gain OF fraction TO IL points dur
ing the first hour today.
- NhN Il pei cent
crease in railroad wages announced
June !, Wall Street carefully
avoided discussing the possibility
or nonacceptance and strike. To-
day the word strike" was quite
freely used as a result of a Chicago
dispatch stating that the shopmen
had voted ty a large majority to
reject the cut The Railway Labor
Board is the court of last resort
in wace disputes and the Street
recognized, therefore. that II the
shopmen's rejection is to be more
than a formal protest then a strike
is not outside the bounds of pos
sibility. Yet the financial commun-
ity does not believe that the shop
men or any of the other labor or
gsnjEations which are yet to act on
the award will actually strike. The
chief reason for this confidence in
a peaceable acceptance of the wage
reduction is that anything but a
formal protest would rot meet with
public sympathy. The transporta-
tion act does not give the Labor
Board power to enforce its deci-
sions. Such a provision was con-
tained in the Esch bill. but was
omitted In the conference leading
up to the framing Of the so-called
Esch- h-Cummins bill last summer.
bid price for money. securities
or anything that is sold does not
make a market but II the same
figure is adhered to long enough the
asked price is likely to soften. This
has heen demonstrated in recent
weeks in the time money market.
Brokers realized per cent time
money some weeks ago because
they refused to take any consider
able amount at higher figure.
More recently they secured loans
at 6i9 per cent by the same method
and today. encouraged by a long
spell Of easy call money, they low
cred their lid price to per cent.
II the present rate on call loans
remains in force long enough there
should be some actual transactions
in time money at per cent Even
now there are reports OF mixed
collateral loans renewing at per
cent. Prime commercial paper of
short maturities is being discounted
at 81 per cent. The rate on longey
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