Great Falls tribune., 1922-04-23
BY STUART p. WEST.
Special Correspondent Of The Great Falls Tribune
Copyright, 1922, By The Great Falls Tribune.


Copyright, 1922. By The Great Falls Tribune
New York, April 22.-The central
feature in the markets of the last week
again has been the presence of seem
ingly inexhaustible investment de-
mand. For nearly year now TINS
movement has been in progress. 1t
has practically wiped out the enormous
shrinkage which the war and the sub
sequent credit strain brought IN in
| vestment values. Along with this, It
has readily absorbed new security OF
ferings, greater by far in their total
length of time in our history. Yet,
withal. the supply of funds seeking en-
ployment in the security market ap-
pears to be as large as ever.
Stock of Gold Doubled
1t is beginning to be better appre-
ciated that this astonishing investment
market is, in part at least. manifesto
ton of the existing gold initiation.
Within the last seven years the stock
of gold in this country has exactly
1st of April. 1915; it was $3,75O.OO0.
600 on the 1st of April. 1922. Under
the conditions of "a months ago. with
production greatly over extended. the
prices widely inflated. it took all the
addition to the gold supply to support
bank credits as they then stood. But
the protracted period of liquidation
along with the continued inpour of gold,
has created reluctancy in cash re-
sources. One result is seen in the
constant lowering of money rates.
which even this week reached a new
minimum for the season. The other
result is the unparalleled demand for
investment because the vast surplus
capital released by the trade depres-
sion is seeking employment which it
Demand Continues
How long this investment movement
is likely to 60 on before meeting a
check is a hard question to answer.
Ordinarily it might be thought that the
change would come with reviving trade
and the consequent diversion of funds
from financial into industrial lines, but
the fact would still remain that the
basis for credit represented by gold
reserves has been so enormously en-
trade expansion to bring an equation
about between the demand and supply
of credit. Eventually the stage may
be reached where Europe will be a
creditor in the American exchanges and
when our gold stock will be drawn upon
as means of settlement.
Corner Turned In Trade
Such a state of things must in any
reckoning he looked upon as long
way off 1t could not come about as
the result of reduced consumption Of
American commodities abroad, for
Europe has already gone the limit
along this line. The comparison be-
tween our February and March exports
leaves no doubt that the corner has
been turned in the foreign trade and
that Europe's enforced economies had
their extreme depression in the Febru
ary figures.
IF the exchanges are TO be righted
so that the gold movement will resume
its normal course, it will only be by
reason of a tremendous investment of
American capital abroad, sufficient to
offset Europes indebtedness to us.
Under these circumstances retrans-
fer of gold from America to other
countries would be conceivable
Still Prices Advance
In the meantime the fact will re-
main that our present gold stock is ex-
cessive when measured by the standard
of trade volume now and before the
war. In other words. the increase in
the business volume and consequently
in credit requirements since 1914, is
not comparable to the increase in the
gold supply.
Nothing very striking has happened
in the business situation during the
week. The most important occurrence
has been the further raising of steel
prices. this logically accompanying the
expansion in the demand for steel prod
ucts. In general. industrial reports
suggest that the recovery which set in
two months ago has in many directions
proceeded more rapidly than looked
for, that business is much nearer back
to normalcy than had seemed likely at
this time. But this affords no excuse
for some of the recent extravagances
in the Wall street speculation.
Stocks More Orderly
The stock market was right in dis
counting as it did during the winter
and early spring to normal production
and normal profits. But it has been
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