Omaha daily bee., 1922-05-25
Financial
Gb. Mem 1srk WmeS.
By ALEXANDER DANA MOVES


New York. May si,-Allhough the
Interstate Commerce commissions
announcement OF an average 10 per
cent cut from existing railway freight
rates took today's markets some.
what by surprise. lis effect on stock
exchange prices was OF the slightest
The majority OF railway shares ended
the day al exactly the closing prices
OF the day before. Insofar as the
commissions decision was a shock
or disappointment. the markets
attitude might be accounted for by
the fact that the railway shares have
not moved up with the general list
since this sessions rise on the stock
exchange began. But there are other
reasons why 10 per cent reduction
may be accepted philosophieally.
The advance IN rates during Au-
gust. 1920. ranging from Is to 40 per
cent IN the diiieren, geographical
groups. is admitted by most railway
men 10 have been too great. IL
turned out, n railway language. 10
be more than the traffic would bear.
Some reduction has already been
made voluntarily by the roads and on
the question OF further cuts much
difference OF opinion existed.
Different Eneet.
Hut u must not he forgotten that the
effect produced on earnings By such
lowering Of rates IL very different in q
period Of enlafxinw traffic from wha,
II would have been IN 1921, The com.
mission states Its own belief that net
earnings at existing rates. II continued
Tor another year. would largely exceed
tn. statutory fair retusn.'
Taken alone. the eommission's judr-
.foreshadowlng results. might possibly be
mis,rus,ed. II is wholly In line with
experience. however. Two years Hner
every one Of our acute financial crises
American railway traffic has invariably
immediate "sfter-psnic reaction that the
years total freight mileage actually
reached higher figure than any pre-
ylous record. with still larger totals IN
creased along with the traffic and that
happened despite the fact that rate.
continued to decrease during at least half
a dozen years.
What the present situation indicates
may be Judged from todays 'car loading
statement" for the second week OF May.
Notwithstanding a decrease from the
same week in 1891 OF $1,000 cars OF coal
Increase in general merchandise was so
great as to bring the total loadings
$4,000 cars above last year and $4,000
above 1919
Movements Uncertain.
While the railway shares stood motion
less on the stock exchange, Industrial
shares moved with as much uncertainty
as the day before and the movements
again had little relation TO one another.
The smbers of the recent speculative blaze
over steel mergers flickered.
Outside the stock exchange. speculative
attention was converged on the extraor-
binary swing OF the wheat market prices.
grain market which can fall cents on
the first day OF the week, rise cents on
the second and fall on the third. II
clearly in spasm Of speculative read
justment. That all this commotion
should center on the May delivery Is
doubtless partly because other future con-
tracts dealt in have to reckon with sup
plies from the new crop. whereas only
the old crop leftover surplus is available
for May. But behind this is the question
of successful or unsuccessful bull specu-
lation."
We are likely enough to get all kinds
Of versions of the reparation subcommit-
tees views before its members have
reached positive concessions on their own
account: therefore. the cabled disclosures
should be taken with discreet reserve. The
really important fact is the evidently
growing impression, even at Paris, that
something practical will result from the
discussion.