Great Falls tribune. [volume] (Great Falls, Mont.) 1921-current, 1921-03-20
FINANCIAL DIGEST
- THE WEEK I'm BUSINESS :
ii s:ss

- BY STEWART P. WEST
Special Correspondent Of The Tribune
Copyright 1921 by The Tribune
New York, March 19.-The course
of this weeks market has indicated
the opinion, which might to many have
seemed in jeopardy a week ago. that
the real turn for the better in the fl
nanciM and commercial situation came
at. the beginning Of the new year. The
decline on the stock exchange in Feb
-ruary and the first ten days in March
was not the renewal of the major
downward movement which eliminated
toward the end Of December. II was
simply the secondary reaction familiar
under all similar circumstances of the
past. First there comes the impulsive
rebound from state of virtual panic
this is what was seen in the early
part of January.
n Stock Conditions Distorted.
Such d rebound invariably carries
prices up too fast and too far for in
vestment buyers to follow. Thereupon
sensues reaction which, while it stops
considerably short Of reaching the pre-
svious bottom, does bring many indi--
svidual stocks to new low points and
produces n great uedl VI uncertainty DIS
to whether the real downward swing
has not started again.
Ii This is what happened between the
middle OF January and the early part
Of March. Misgivings on this point
should have been sufficiently relieved
by what has happened in the market
during the past week. It can now be
seen how the true position was dis
torted by the bear operations which
reached their climax a week ago. These
operations in the latter stages brought
little fresh liquidation and when the
short interest set about getting in its
contracts, recovery was very rapid.
Copper Outlook Better.
Reviewing the business situation last
week, a great deal Of irregularity had
to be noted Things were better for
the textile industry, for the motor
trade and for wholesale dry goods than
they had been two months back; they
were rather worse for steel and cop
per. Reviewing the situation at the
close of the present week this irregu-
larity has been lessened. In the lines
where improvement was under way it
has continued. At the same time the re-
ports have become shade more cheer
full concerning the copper trade while
leading representatives in steels have
expressed the opinion the. worst was
over in their industry and the belief
has grown that the price cutting in the
oil trade has gone as far as is neces-
sary to complete the reimbursement
there also. Renewed confidence that
the situation at large is on the mend
has been the keynote Of the upward
movement in stocks during the week.
The second factor back of the rise
has been the partial relaxation Of
money rates and the general feeling
that the money supply from now on
is going to be more abundant. There
has been occasion to realize the i'm
portance of the distinction between
the Wall street position as 1t was the
first week in March and as it stood in
, the first week Of December; namely.
that credit conditions were immeasur-
ably better in the first instance than in
the second. Now the credit crisis has
not only been passed but the bank ra-
ito has so improved that an early re-
duction in federal reserve discount
rates can be looked for. This. is pref
ty sure to come anyway in the not dis
tant future but action would be hast
ened il, after the British tax payments
are completed as they will be by. the
end of this month, the Bank Of England
were to lower it's minimum discount.
ljro Shows Advance.
The various movements in the for
eign exchanges during the week have
been more than usually interesting.
Sterling continued it's recovery and
before the break off following the rep
arations conference but it has gone
higher still. Here is plain reflection OF
steady improvement from the British
standpoint of the relation in exports
to imports. There has been an extra
ordinary advance in the Italian ex-
change due unquestionably to a genu-
inc betterment in the fiscal and eco
nomic position in Italy. French ex-
change has not gained with the rest but
has been inclined to 60 the other way.
One exclamation for this is that the
large credits held in England and the
United States against France have ma
tured and have not been renewed. An
other explanation is the prevailing un-
certainty over the next developments
regarding German reparations which
OF course, mean everything to the fl
nancial future of the French. just
which of these two influences is the
most important is something upon
which more light is needed before judg-
ment can be pronounced.
Raj! Pessimism Overdone.
! As expected the foreign trade Of
the Germans for February revealed
more plainly than those of previous
months the effects of the decline il
commodity prices. The heavy shrink
age in both exports and imports as
compared with both January Of this
year and February Of last year was
much more a matter of price reduc-
ton than it was of decreased volume
The official computation that during
February wholesale prices were off 81
per cent on the average gives reason
for the entire result.
The railway problem scarcely wears
any different aspect from what it die
a week ago. Apparently railway EN-.
ployes, as a rule, propose to fight the
labor board to decide. Both parties to
the controversy are anxious to expe.
dite those proceedings and it is not I'M.
likely that test case involving some
one representative road will be brought
up for decision with an understanding
that it will cover all other disputes
Naturally the position in railway stocks
hot doubtful npfi