The New York herald., 1922-11-24
FINANCIAL NEWS
AND COMMENT
Liquidation of Stocks Still
Directed by Professionals,
Causing Lower Prices.

Further liquidation in stocks and
bonds and another decline In conti-
mental European exchanges were the
only features OF another dull day IN the
financial markets. On the Stock lex
change railroad shares as a. group and
some of the more or less speculative
industrial issues declined sharply all
through the session. with only mo-
mentary rallies that were almost en-
tirely without any significance.
Two important influences seemed TO
be at work In the market for railroad
stocks, either Of which in the present
period Of purely professional interest
would be sufficient to put those stocks
down. On the one hand was the grow
ing fear that the reactionary element in
the new Congress may be strong enough
to force through railroad legislation
which will work havoc In the industry.
There appears to be, so far at least,
no reason for anticipating such a de-
velopment. II Is true that there will
be certain interests in Congress which
may attempt to amend the transporta-
tion act in such way as to increas
the burden on tho carriers. but there
is no present indication that this group
win be strong enough to force It's will on
the country. AS a matter OF fact there
are those who believe that II al
change Is made in the laws regulating
the railroads 1t is moro likely to be con-
structive than otherwise.
There is another factor which has
been important in the decline in railroac
securities and which only now Is coming
to be recognized-that is. the liquidation
Of large pool holdings. There is n
doubt that In such stocks as New
Haven, New York Central. Rock Island,
Reading and some others that strong
speculative groups have been at work all
this year. Now 1t appears that many of
them Have completed their campaign, at
least for the present, and have closed
out their commitments.
Induced largely by these two major
elcIHeHlS III tHo SiludlioH tHoro 40
third important factor in tho decline
Of rails which cannot be overlooked even
though 1t be an effect rather than a
cause-that is the liquidation Of hold
ings Of disgusted spectators. The
lower prices brought about by the first
two factors have caught many stop loss
orders. and these sales. coupled with
those made for tax purposes. have only
added to the general feeling of gloom
concerning the immediate outlook for
railroad stocks.
There is little doubt that the readjust-
ment of the holdings Of many Stock Ex-
change houses made to bling them more
In line with the capital position Of those
houses also has been an important in
fluence in inducing sales of securities.
This. of course. is the effect of the rigid
questionnaire which all members OF tho
Stock Exchange must file with that in
stitution. AS for public participation. it
has receded to a point where profession
al traders are In absolute control OF the
market at this time.
The bond market was weak on busi-
ness n little more active than recently
Rail bonds were under particular pres
sure and foreign bonds were quite reac-
tionary.
Cotton regained some Of It's previous
days losses. but grain again declined
Call money was somewhat easier.