The New York herald., 1922-01-28
FINANCIAL NEWS
AND COMMENT
Rise of Sterling Exchange Is
Steadying Influence in
Stock Market.


which carried other European rates
upward In it's wake. served yesterday to
draw the attention OF the financial COM
munity away from some depressing
matters in industry and impaired a
steadying influence to the stock market.
The rise of sterling to a shade above
AS, not only was gain of cents to
the pound, compared with Thursdays
final quotation for sight drafts. but
also established the highest record
reached since the week of September
27. 1919. 1t was plain in banking house
comment that hurried retreat of the
short interest. which had expanded
rapidly after the BRAND Ministry's fall
was the chief cause of the bulge, but
the movements basis evidently was
found in the firm tone of the rate dur
ing the last week. In the last analysis,
it may be said that the improving situ-
alton of Britain's fiscal structure has
been acting as a support to sterling for
many weeks and bankers believe that
the exchanges of all European nations
which make genuine attempt and meet
with success in balancing their budgets
will move forward this year. Sentiment
toward sterling and francs was helped
yesterday by the growing thought that
the French Government would hardly
lessen the prospects of real results in
the Genoa Conference by standing
firmly opposed to certain measures
likely to be taken up in that proposed
meeting. A change in the French atti-
tude in a few days was expected In GER
tain quarters.
Stocks moved down rather easily in
the morning, especially one or two steel
issues and a few specialties, but selling
pressure decreased materially before
noon. The street was duly impressed
by Charles NJ. Schwab's optimistic out
look, voiced at dinner on Thursday
night. and his announcement Of the
Bethlehem Steel Corporations plans to
spend s25,000,0O0 for additional facilities
undoubtedly was a help in checking sales
Of steel company shares. In its broader
aspects, however. the market displayed
little besides the exertions of pools in
their favorite issues and a disposition
Of the rank and file of traders to hold
off until new information about spring
business appeared. Public participation
was decidedly light.
A reaction of Liberty bonds SEEM
ingly was directed by fears of a soldier
bonus law which would bring out
new issue of Government securities or
have an adverse effect on money rates
in other directions. The bond market
also is sensing the tremendous task
entailed in refunding Victory notes dur
ing the next twenty-three months, a
process certain to have q bearing on
the interest returns from all kinds of
funded securities. The bond turnover
on the New York Stock Exchange was
heavier than it was on Thursday and
prices were slightly reactionary. Call
money loans were renewed at per
cent, and afterward the rate advanced
to 5h per cent
A contraction OF the Reichsbanks
circulation for the third successive week
attracted special attention because of
news that bill for compulsory 1000
100000 gold mark loan was being pre-
pared for the Reichstag. In a month
the banks circulating notes have been
reduced more than 1000. 900 coo paper
marks. and 1t seems as though a loan
which would force the use of private
German credits abroad would lend aid
in cutting down the notes extensively.
Bankers here. however. are skepticaI
of the success of such a loan, inasmuch
as the impression is strong that the
German Government could do much
more than it has been doing in the
collection Of taxes under existing legis-
lation.