The New York herald., 1922-07-09
FINANCIAL NEWS
AND COMMENT
Realizing Sales of Stocks, Aid,
ed by German Situation,
Send Prices Downward.

As the stock market has been wont
frequently this year to move independ-
emily OF the foreign exchanges and
commodities. it was possible to explain
yesterdays reaction OF point to more
than points by pointing to realizing
sales at the end OF a week in which both
rails and industrials had scored size
able advance
But 1t was. probable, nevertheless.
that spectators paid some attention to
the German Governments request for
moratorium in respect to reparations
payments and to the fall OF the mark to
new low level. While neither devel-
opment was surprising-France several
weeks aso consented to a moratorium
with conditions. if the Preparations Com
mission judged it necessary-both were
reflective of more serious state OF
German finances. public and private.
than had existed before.
The mark was variously quoted at
.1s1s and .1si4 cents as the days mini
mum price, each being well under Fri
days lowest and about .03 cents lower
than that days final quotation. A weak
rally left it at 10 cents at the end of
trading
The relation which exists between the
level Of German exchange In outside
countries and prices of goods within
German boundaries quite possibly led
to the reduction of speculative lines in
stocks.
Prices of commodities move in the
direction opposite to the trend of ex-
change, an economic fact which makes
certain the advance OF German living
costs in the next few weeks. provided
that exchange fails to recover its recent
decline from around .32 cents to the
mark. This process has been going on
right along, as 1t has in all countries
with severely deprecated exchanges. but
the chief significance OF new burdens
upon the German people just now lies
ir. the conjunction Of them with a grave
political situation. A rise of prices at
this time in the opinion Of many bankers
and business men would contribute to
Germany's unrest, add fuel to the po-
liticai flame which already threatens to
consume the Republic.
French exchange recorded senti-
mental product Of the drop of the mark
by receding to 7.s1 cents. also estab-
fishing new low point for 1922.
Sterling at $4.44H was down quar-
ter cent from Fridays last price.
Running parallel with the exchanges
lin theory at least-was a recession of
10 to % points in cotton futures. while
grain and animal products. which figure
largely In exports, lost ground.
There was little choice between rail
and industrial shares in discussing the
markets weakness. The former APP
peared to recedc the easier under rather
moderate selling. a development plainly
connected with the speed with which
many railroad issues were bid upward
points or more included American Car
& Foundry. Baldwin Locomotive, Louis
vile & Nashville, New York Central.
Standard Oil Of California and Stude-
baker, issues that were entirely represen-
tative OF both the speculative and in
vestment classes of listed shares.
The Clearing House banks excess re-
serve increased no less than $21,000,0OO.
due to a large contraction OF loans and
an increase OF more than $S,4o0.o0o In
reserve credits at the Reserve Bank.
While loans declined s4s.00o.000 de-
mand loans receded $9s,400.000. a
spread which suggested that interior
banks were busy throughout the week
in drawing down their New York bal
ances. The heaviest portion of loan re-
duction occurred in the closing days of
| the week. the decrease in the statement
! of average daily condition being less
than $3.60o.00e