The Washington herald., 1922-08-20
TRADE SENTIMENT
GROWS OPTIMISTIC
DURING PAST WEEK
Satisfactory Progress in
Coal Situation Erases
Earlier Gloom.

Business sentiment grew in
creasingly optimistic during the
week as the efforts to effect a solu-
tion of the labor controversies gave
increasing promise of success and
as the grain and cotton markets
began to recover after a period of
receding prices. The adjournment
OF the london conference, follow
ing series of fruitless negotia-
tions. and the consequent break in
the exchanges of the continental
countries Immediately concerned In
these deliberations. caused the mar
kets at the beginning of the week.
to be swayed by bearish influences,
The delay in the expected announce
ment of a basis of settlement for
the coal strike and the impasse in
the negotiation for ending the rail
strike also had a depressing effect,
but these unfavorable conditions
proved to be shortlived. Satisfac-
tory progress towards the settle
ment of the strike in the bitumln-
Gus nelds was soon announced and
new conferences to deal with the
anthracite and railway strikes were
initiated under fair auspices.
Commodities Drop.
The close relation of our own
economic welfare to that of Europe
was again illustrated early this
week. when wheat and cotton de-
clined sharply or news of the
breakdown of the reparations ne
gotiations. Wheat dropped below
81 bushel before export buying,
attracted by the low prices. brought
some recovery. Cotton prices like
wise rallied on the Census Bureaus
showing of an abnormally low
carry-over at the end of the crop
year and on reports OF further de-
terioration of the new crop. The
cotton market has shown a tendency
to react after every substantial ad-
vance In prices. thus rejecting the
uncertainty both as to prospective
supply and as to prospective con-
sumer demand with prices at their
present levels. The recent ten
dency. however. towards higher
values for this staple is held to
indicate that the trade has ac-
cepted the idea of somewhat
smaller yield than had originally
been indicated in private estimates.
While a complete settlement of
the strike in the unionized soft
Goa! mines has not yet been effected,
there is little reason to believe
that the IS per cent of the produc-
Ing capacity not included in the
Cleveland agreement will remain
Idle. The mere sight of the COM
petiing mines in full operation
should prove a strong inducement
TO those who are still holding out
to fall into line and gain their
share of the profits available to
rival companies. The Cleveland
agreement will increase the week.
ly coal production to something
more than 100000 tons. which is
far short of estimated requirements,
but this is regarded as a prelim-
mary step to a full settlement.
Immediate Revival Unlocked For,
The present outlook does not
Justify the view that the basic in
dustries will be able Immediately
TO resume their status quo ante up
on the termination of the coal and
rall strikes. For a considerable
period the effects of the strikes
VIII still he in evidence. The steel
industry. for example. hardly hopes
{" attain again during the current
year It's high rate of production
reached during the latter part of
June. The steel corporation is now
operating at about 60 per cent of
It's capacity. compared with a rate
of - per cent at the peak of the
year. and the Independents are op-
Grating at an advance rate of so
per cent. The system of priorities
in coal distribution must be con-
tinued for some time. as indicated
in the Presidents latest message,
and until the necessities of the
needy regions are provided for
there Will he a fuel shortage for
the iron and steel business and
probably for other industries as
we'll Had il not been for the crisis
in the domestic labor situation the
decline Of the German mark to the
low level of .o7l2 of a cent would
nave proved the sensation of the
week. Germany has now reached
the anomalous situation where the
total gold value Of it's note circula-
tion diminishes with each success
stve increment of paper currency.
In other words the gold value of
note issues is less to-
day than 1t was a year ago al |
though the quantity of paper marks |