Indiana daily times. [volume] (Indianapolis [Ind.]) 1914-1922, 1921-08-22
MONEY GROWING
IN ABUNDANCE;
GOOD TIMES DUE
Thrift Cause of Another Cycle
of Prosperity, but New
Legislation Helps.
MARKET IS STILL WEAK
SneciaI 70 Indiana Daily Times
N. anlrhEa RrahIIl. I.AdEer.

MARKET is STILL WEAK
speciaI 70 Indians Daily Times
and Philadelphia Public Ledger.
NEW YORK. Aug. 22.-Cross currents
continue 70 confuse the general financial
situation and to find reflection IN Sc
turity prise movements The general
Improvement and the hopeful outlook
frem 4 fundamental standpoint is not yet
sufficiently assertive to overcome the ad-
verse influence Of certain concrete factors.
Undoubtedly the chief pressure on the
market Of late has been in the nature
Of liquidation Short selling has played
its part, Of course. but no one who has
clear knowledge OF the character Of trad
Ing believes that short selling alone has
been the depressant- Professionals are
daring when they see a chance for ntmble
profits. but experience has taught them
the futility Of selling dun markets around
the lowest levels in years.
As TO the causes OF liquidation. prob
ably no one explanation would suffice an
less Il might be embraced under the
generic head Of the need Of liquid funds.
Much Of the selling has been Of the char
acter described by the up-to-date market
writer as "necessitous." Business losses
and the decline in the market. as well is
reduction in incomes due TO passing OF
dividends. have put thousands OF well-tO-
do citizens in need OF ready funds. This
has furnished the occasion for part OF the
selling. Many others have sold because
they see no particular advantage 10
hanging on 10 stocks that pay no divi-
dsnds and that refuse to advance. ss-
pecially when cash Is a handy thing to
have around.
PUBLIC INDIFFERENT
TOWARD STOCKS.
This may serve TO snow the occasion
for recent offerings OF stocks around pre-
vsiling low levels It also is ex pIanatOry
OF public apathy and Indifference toward
stock market movements. People
speculate as & rule as one veteran Of the
street put it years age. from hope OF
profit" At present they appear to be
tired Of hoping
Under such circumstances. there is little
ground for surprise over the failure Of
broadly constructive developments to
stimulate active optimism. The railroad
funding plan. taxation reform. dissrma-
Rent, reduced governmental expenditures
an these things are helpful, but to the
mar long OF stocks and disappointed over
declines they appear to be benefits as
indefinitely deferred as the promise OF
paradise.
Prom an underlying standpoint and re-
Eardless OF public sentiment. the situa-
ton Is steadily improving. Wages and
production costs are being reduced.
Many amateur economists fail to see how
ultimate good can come from wage re-
ductionS. inasnuch as It means
ourssslmeHt. Of public buying power
Para6oXical as il may sound. It means
no such thing. It means early restora-
don Of buying. High wage scales at
present represent merely an aggravating
symbol OF wartime prosperity. They
are not being paid because industry is
idle Labor on the farms IS working
hard az 50 cents to 81 4 day. The in
oustrial worker Is out OF a job. although
his scale may be around a dollar an
hour With reasonable reduction in the
scale the industrial worker gets busy
and the consumption OF raw products.
such as copper. cotton. wool etc begins
70 Increase. The price OF raw materials
rises, and the producer Of these products
becomes larger buyer OF industry's out
put In this way steps are taken toward
restoration OF equilibrium between
different groups. thus permitting unIm-
Peded fOw OF products from one class to
another
MONEY GROWS
IN ABUNDANCE
Another factor working gradually but
surely in favor Of general improvement
Is the growing abundance Of money.
This has come about partly from thrift
aud partly from the slowing-up IN
business. New York City savings Tank
deposits now stand at 1872 per cent com
pared with July, 1918. In times OF de-
preston people save. Thrift once more
Is initiating another cycle Of prosperity
As money begins to pile I'D II will be
invested in safe securities People will
prefer the assured return to the haz-
ard Of enterprise. This is reflected IN
rising prices for bonds But as bonds
begin to rise the issue Of more such Sc
eurities is encouraged and the proceeds
from these sales begin to flow into In
enstry. which takes on new life Profits
begin to appear and confidence in
ereases. Before We know It We are in
the midst of another period of activity.
This is the almost Automatic result OF
growing monetary ease. no matter
whether this originates from thrift on
the part OF the public, or the slowing up
in business.
While this may be the natural course
of the cycle there is little doubt that its
course might be accelerated by such in
cidental but helpful expedients as the
passage Of the railroad funding LII.
which would give an artificial. but
nevertheless genuine, stimulus to in
dustry
The financial atmosphere. however. will
not be entirely cleared until the tariff
and tax bills have been enacted into law
and wage establishments have placed re-
ductiOn costs on a sound basis-COry-
right 1921. by Public Ledger Co