Evening star., 1922-04-09
BY 4TUART p. WEST.

special correspondent OF The Star,
NEW YORK. April 8.-The Wall
street situation may be summed up
in the statement that the invest
ment movement has lost none of its
vigor, while the speculative move
ment has steadily gained. 1t has
taken nearly three months of rising
prices on the stock exchange for the
public to wake up to the truth that
general business is very much i'm
proved, and that Wall street was
right when, as long ago as the mid
ing this improvement. The Million
-a-half-share days" which the
market has now attained, mean that
outside buyers, who held aloof while
prices were down, are now focking
in as they have not done since the
spring of 1920.
Wall Street Wrong in 1921.
All this is quite in accordance with
precedent. Still it shows more force
fully than ever that the Wall street
markets of year ago misread gen.
eral conditions just as badly at the
one extreme as the markets Of 1919
had at the other.
1t is true that much of the liquida-
tion which brought about the low
prices of the first six months OF 1921
was involuntary liquidation.
individuals had to go to their
strong boxes to obtain the means to
protect themselves against threat
ened business losses.
Corporations caught in the terrihc
slump, and needing money to cover
huge depreciation in inventory ac-
counts, had to unload their security
holdings right and left. 1t was this
sort of forced selling which brought
liberty bonds down to So and perfect
ly sound corporate securities to
and even per cent basis.
Business Men Pictured Disaster.
Still, looking back to the blue days
of last summer, these excessively low
quotations did not misrepresent the
sentiment of the time. The attitude
of complete discouragement. Prom
inent bankers were privately quoted
as most pesSimistic.
As for speculative Wall street, it
had a picture of the whole world out
side this country going bankrupt, of
consequent reputation of all in
detedness, both public and private,
inquired by Europe to America dur
ing the war years, and with this, a
total loss beyond recovery of the for
eign trade.
AS these evils pass into economic
comment that July, 1921, was quite ds
foolish and extravagant a Yeriod in
the era of liquidation and detation as
was October. 1919, in the era of in
flation and wild speculation which
preceded it,
Security Prices Near Normal.
So far as present security prices
are concerned, they are back pretty
well to normal. This is true of the
n V6c r,1e nj liSf n
grade of dividend paying railway
stocks and of the majority of the rep
resentative industrials. The whole
recovery of the last nine months has
been in anticipation of just such an
improvement in outside trade condi-
tions as is now occurring.
But inaSmuch as nobody anticipates
an immediate trade boom, there is no
justification for any big speculation
in stocks. If the Wall street pools,
tempt an imitation of the markets of
two years ago, it will prove an expen-
Sive experiment, if not for those en-
gagged in it on the inside, most GER
family for those drawn into it from
the outside.
Caution the Better Part.
The time has come where caution
may well be the better part Some of
the performances which have been
staged during the last few days in the
industrial share market are decidedly
reminiscent of those which had SO
unpleasant a sequel in the collapse of
l92O-21.
There are no immediate indications
of danger. perhaps. The speculative
movement in its present shape may
easily be carried further, but the ad-
vance has in most directions been a
pretty generous measure of the pres
ent trade recovery. All experience
teaches that it is at such times that
the shrewd investors and traders,
who bought when everything looked