The New York herald., 1921-10-18
FINANCIAL NEWS
AND COMMENT
Fear of Strike Causes Slumps
i'm All Markets-Rail Is
sues Especially Hit.

The railroad strike threat was a de-
cided influence in the markets for Sc
curities, cotton and grain yesterday.
causing general declines and discourag-
ing purchases at the lower price levels.
In stocks 1t appeared as though most
of the selling came from professional
sources. and while bonds were un-
steady there were few rain issiies which
receded more than half point. Strike
ago lost most OF their potency in fore
ing liquidation OF investment holdings,
and there was no exception to the rule
in the days transactions. For one
thing. the comment from all quarters
except the railroad union offices in
dicated fairly widespread belief that
either the strike would be headed off
through negotiation. or. IL begun, would
not be long lived. The attitude Of rail-
way executives strengthened that at
titude of Wall Stree.. as such discus
sion as developed over Sunday indi-
Gated confidence that public opinion
would be distinctly against any effort
to hamper transportation at the mo-
ment when business was beginning to
break the thralls OF after war stagna-
tion.
The short sellers in stocks, however
found that potential buyers preferred
to wait for further events in the rail-
road situation before taking on shares,
which made it easy to cause recessions
which ran from I 10 2 points before
noon. Industrial issues. especially the
petroleum group. held up fairly well
for time, but later softened and many
were down as much as the rails at
the close.
The railroad controversy unaues-
tionably contains elements which may
well prove to mark a new epoch In
the return to normal conditions. IT
offers q test whether or not the ex-
panded wage schedules of few classes
of workers are to be maintained by
force at time when the wages of
most other classes have been carried
down by stress Of business reaction.
So far as the union attitude has been
made public 1t is less because of the
proposed wage reduction of 10 per cent
that the strike has been called than
because of vote taken on the IL per
cent. cut OF July. 1t will be a test
also, of whether or not the railroads
are to be permitted to help their .ppcl
carious outlook for reasonable net
earnings. as no figures which show that
the carriers as whole Will not get
into difficulties If rates are lowered
without an, Offset in lowered costs have
come to- light.
Cotton fell 81 bale and wheat fu-
lures slumped cents bushel in Chi
cago. AS in September, the markets
all acted in concert and 1t may have
been that the spectacle of declining Sc
curities reacted on commodities. The
news of the day with direct applica-
tion to wheat was not Of bearish ma
ture. the Governments report of exc
listing stocks being $4,000. 900 bushels
or 12 per cent, less than they were a
year ago. The report. however. showed
some 5o.000.000 bushels more in eleya-
tors than had been expected. and SEN
tment doubtless leaned toward the
thought that the prospect of railroad
tieup would hasten liquidation in the
remaining days before the strike is
scheduled to begin.
There was no surprise for anybody
who had followed the German financial
policy in the sight of the mark rate
falling precipitately to so Of a cent
at the start Of business. A late re-
covery put it back to 80 per cent OF
cent The movement here followed a
break in London. 1t suggested strongl2
real panic among business interests
in Germany. and brisk upturn OF
Dutch and Scandinavian rates as well
as bulge of 3h cents in the Lon
don quotation seemed to disclose hasty
conversion of marks into more stable
currencies Of other countries. Things
are clearly drawing rapidly to head
in Berlin.
Call money. as was expected. was
easy. going from 51s per cent. to 4
per cent.