Great Falls tribune. [volume] (Great Falls, Mont.) 1921-current, 1922-12-03
By STUART r. WEST
peciaI Correspondent of Gresr falls Tribune

Copyright. 1922. by The Great Fails Tribune
New York, Dec. 2.-The principal
point of interest in the stock market OF
the last week has its endorsement OF
the view that the October and NoVem-
Der decline was due to conditions on
the inside of the stock exchange rather
than to conditions outside.
There were, as repeatedly pointed
out by the writer, two possible ways
of looking at the autumn downward
movement. Either it was q forerun-
ner of a less favorable business year
than expected in 1923, & sign also OF
serious uneasiness over the economic
situation in Europe with its ultimate
bearing upon world finances, or twas
simply the rough handling Of a spec
ulatiYe position which had become over
extended and weak, as the result of
| ~extravagant trading Of the spring and
summer. .
After what has happened during the
last few days there can be no longer
any doubt as to which Of these W
versions is correct. The downward
swing, which began just after labor
day and which eliminated at the start
Of the past week, went to quite as
Ihti Va al t1 ~ "P'|~
swing preceding it.
just as the market last May and
! again last August lost sight of the val
,ues in the wild u~p-bidding of prices,
SO the market of the last two months
crashed downward without reference
to the facts of the business situation
on the outside.
Pools Main Sufferers
Probably few experiences have been
more bitter for professional Nal
street. In the great decline of 1920
p there were. it is true, numerous IN
/ stances where wealthy capitalists and
banking interests met with very serl-
Gus losses. But it was the public that
was the main sufferer. On the recent
decline the public was not caught to
any such extent. What happened was
the pools, unable TO unload their stocks
in the midsummer campaign, were
j gradually forced out by the pressure
Of the hanks. stock exchange author
{ tiles and by the severity of the break
! itself.
This disruption of speculative syn
/ dicates was what threw the market
into such decentralization and carried
the decline to greater lengths thah
+ Wall street could have anticipated.
Now with the completion of the forced
selling prices have had their natural
rec0il and now there is general percep-
ton that the downward movement had
mo u~nfavorable significance so far as
/ concerned domestic trade or political
and economic affairs abroad. favorable
items in the business news have once
more begun 10 cunt.
The market is paying attention as it
was not Il week ago. to the fact that
the steel mills are employed up to 81
per cent of capacity-that ~. are back
to the scale of operations obtaining
before the collapse two years ago-that
the copper. zinc and smelling companies
are making money for the first time
since 1920. hat the rubber and tire
manufacturers for the most part find
their position improved by the rise in
crude rubber and cotton, and that the
makers of automobiles and automobile !
parts. and the manufacturers OF rail
way equipment are looking forward TO
n still greater rush of business in the
spring.
Good Business
1t would be q mistake. however, to
read into the outlook for 1923 any
thing resembling Il business boom.
Rather the promise is for a period Of
active competition and small profits
margins, Il relatively large volume of
production. but generally moderate re-
turns. One problem pressing for settle
ment IS how freight rates on agrlcul-
tural products can be brought down so
as to give the farmer his accustomed
income II at the same time not de
priye capital invested in the railways
Of Il fair yield. The advance in farm
prices since the middle of September
has been very helpful in this connec-
ton. Quite likely If cotton got up an
other . cents a pound aud wheat around
10 to - cents Il bushel, the agitation
Tor rate reduction might disappear. But
If this does not happen a solution will
have To be found, and it is TO be hoped
II will be along the line suggested by
the secretary Of commerce@Which pro-
poses II general shake up of rate SEIZED
ules so that what the roads would lose
through decrease in the tariff on farm
products would be made up 10 them
through increases in other directions.
Pressure Lifted from Railroad Stocks
At all events it does not seem likely /
that any amendments to present trans
portation act will pass the present
short session of congress. With this
pretty well assured the pressure has
been lifted from railway securities and
they have had their full share in the
weeks recovery.
Sterling exchange. at a new high for
the year and the highest since 1919. |
and Italian Her with a gain of a full
cent from the October low. are Incl
dents Of much significance for the
financial situation abroad.
There are in fact no longer my OBJ
stacles TO prevent the British pound
from getting back to its old time par
lty. except the necessity of providing at
regular intervals for the service of the
American war debt. This is not n
serious matter because the four bill
lions owed by Great Britain to the
United States mas now been incorporat-
ed III the international balance sheet
and the annual interest reckoned in as
part of the British budget.
France Checked
Meanwhile, the recovery in the
French frame has been checked in the
manner expected. The notable della
ton in French paper note issues be-
tween the first week in October and