The New York herald., 1922-05-08
FINANCIAL NEWS
AND COMMENT
Ease Of Money Continues Pow
erful Force for Stock Mar
ket Speculation. II
NEW BONDS QUICKLY SOLD
Call Rate Relaxes to 3 1-2 Per
Cent.-British Exchange
Gets Over 4.44.
NEW BONDS QUICKLY SOLD


business, current and prospective. the
fact that a most fo-ceful influence for
speculation is as potent as 1t was two
months ago remains. 1t is the ease Of
money. The demonstration of monetary
relaxation was well disclosed last week
in the bond market. The quick absorp-
ton of new issues showed that the tre-
mendous output of the preceding week,
comprising more than $235, 900. 900 Of
securities. had not saturated the mar
ket, nor did the weight of new issues
cause older ones to draw back from the
level of prices established in April.
The time when the law of supply and
demand will react against bonds will
come OF course. and then it will be found
probably that the use of credit in, in
dustry has expanded largely. But
there have been thus far in the spring
season no unfailing signs that loans
OF all sorts were increasing on a pro-
gressive scale On the contrary, the
contraction OF reserve bank loans
from s1.112.567. 900 in the first week
of January to only slightly in excess of
S50s,000,000 In the week of May 3 was
fairly consistent from one week to the
next and the occasional small increases
were patiently connected with tempo
rary demands of member banks
The fact of abundant money supplies
has undoubtedly had its place in the
program of spectators of large cali
ber. 1t might be possible through ref
erence to charts of stock market
swings to argue that the advance of
prices since last autumn not only has
discounted progress in business but
has run considerably in advance of It.
The sluggishness of railroad shares and
many manufacturing company issues
in the last ten days suggested that a
halt had been called in the rise, but
Immediately on the heels of slackened
of speculation in oil shares
Realizing Does Not Retard Rise.
The upward movement did not stop
on the appearance of heavy realizing
sales in particular quarters of the mar
ket but merely sought new field.
The stocks which had advanced less
rapidly than did steel, automobile and
railroad issues during March and April
were brought up into line with the
others.
The profits taken through sales of the
recently vigorous stocks were trans
ferred to the petroleum department and
the shift. bringing additions to the
long list of million share days, had no
pronounced effect upon rates for
money in this city. The May 1 re-
quirements of corporations were salts
fled. the turnover of scores Of millions
of bonds was financed and the enlarge
ment of stock brokers' loans cared for
with an advance Of call money to a
point no higher than per cent, whence
the quotation eased TO 31a pc. cent.
before the end of the week. At the
same time collateral time loan and
commercial paper rates were unmoved
from their long maintained positions
at AZ and AZ per cent. and bankers
acceptances reached down to a rate
equaling the lowest in nearly six
years.
1t "a not. however, The stock market
which occupies the principal place in
the financial field at present. Last
weeks events in the Genoa conference
had more bearing on economic and
financial problems than before. showing.
as they did, that France and Belgium
were watching with jealous eye the
maneuvers OF competitive nations for
preferred positions in Russia. The
news dispatches painted clearly the
tremendously important part which
petroleum was playing in the world
business scheme. And II is not only
petroleum but all other sources of
wealth owned by Russia and available
for exploitation by outside capital
which have been shaping some of the
counsels at Genoa.
Await Genoa Trade Agreements.
IL Will doubtless be considerable time
before the actual business and trade
known. The interplay Of diplomatic