Great Falls tribune. [volume] (Great Falls, Mont.) 1921-current, 1922-04-30

Copyright, l9?2. Dy The Great FAILS Tribune
New York, April 20.--The last week
has brought a partial check upon spec
ulative activities and to SOM extent
also upon investment operations. 1t is
true that the market has readily abb
size. 1t snapped up Canadian govern
ment bonds on a 5 per cent basis, the
most favorable terms which any foreign
power has ever been able to get for
it's public securities brought out here.
It took a New York city bond offering
carrying a Az per cent rate at the
highest figure bid for similar issues.
At the same time it ov~ersubscribed
many flotations reaching an uncommon
ly large total. But on the other hand,
the advance in bond prices, that II, in
investment bond prices, came to a halt,
and it began to look as though the
greater part of the list had got about
all the stimulus possible out Of q 3k
per cent call money market and a Az
to An per cent rate on time loans
and commercial discounts.
Stocks Advanced Too Fast
The question before the stock mar
ket has been whether or not the rise
in prices since the middle Of January
overmeasured the progress of the bust
HtsH StludJiOh OubSluP. wall SLrcpg
speculative syndicates have had the
advantage of cheapest and most abund-
ant credit in five years. They have
had the powerful help Of the invest
ment buying movement, quite unparal-
leled for it's magnitude and intensity.
Under the circumstance it has been
easy to advance stock prices and the
tendency has been to push this advance
without being too particular about ask
ing whether it was fully warranted by
the facts regarding corporate earnings,
present and prospective.
Healthy Advance, But No Boom
1t was a good thing that this specu-
iatlve extravaganza met with the re-
buke it did in the sharp mid-week re-
action, At the pace it was going a
fortnight ago the market was riding
for a fall. 1t was ~fancying itself back
to the inflated prices and inflated
profits of 1919. 1t was forgetting that
the country's trade, while definitely
On the mend. is not in for any boom
and that moderate prices and moder.
ate profits are what all the indications
point toward.
Genoa Not Dominant Factor
Financial conditions have not been
particularly sensitive to developments
at the Genoa economic conference.
When the British premier drew his
fearsome picture of what would happen
should the gathering break up without
results there was Surprisingly little |
response in the markets. Perhaps the
check to the recovery in the exchange
and to the advance in government bond
price might have been set down in part
TO uncertainty on this account. But the |
most important episode in this quarter
the decline in French exchange and
simultaneously in French bonds-has
evidently been due not to anything han
pening at Genoa. but to the multiply-
ing signs that unless Germany, within
the next month. succeeds in floating
a foreign loan. she will confess her in
ABILITY to carry out the reparations
program when she makes her final
answer on May 81.
Germany's Attitude on Preparations
In assuming this attitude, Germany
VIII have the support of all who have
the question with any p~retense
of fairness. The Wirth government
went to the limit when it pushed
through its 1922 budget. Under this
revenue, taxes were doubled by COM
parison with last year and q forced
loan of a billion gold marks brought
the anticipated revenue up another 100
per cent. In a word. the German budget
calls for receipts 200 per cent in ex-
OF 1921 and still falls far short
of providing funds necessary to meet
the reparations demands. 1t is esti-
that to comply with the condi.
tlons laid down by the commission. the
revenue, instead of being 200
per cent above last year. would have to
be 80 per cent greater. The German
claim, supported by impartial econo-
nlsts IN the entente countries, is that
this additional 120 per cent will have
o be raised by an outside loan. that
any further addition to tax burdens
would discourage industry and make the
last state of the economic situation
worse than the first.
Great Britain to Lower Tax
Great Britain has got back to such
a surplus of receipts over expenditures
that she proposes to lower the income
tax. She has got this without the aid
Of any indemnity money and this is why