The New York herald., 1922-12-08
FINANCIAL NEWS Il
AND COMMENT
All Stocks, Except Rail Shares,
Generally Add to Gains
Made Wednesday.

AHo ADVANCE IN 6tockS which began
on Wednesday. Influenced largely BY
Secretary Melons optimistic utterances
In his annual report to Congress, con-
tinued again yesterday although It ap-
peared to have lost some OF its energy
before the end OF the session. In the
morning trading stocks were purchased
with a display of confidence that clearly
disturbed the shorts. Later, however,
trading fattened out considerably and
suggested that the rally had been of
such ahruptness as to materially i'm
pair tho technical position Of the gen
eral list. There was evidence that the
upturn the day before was almost. en-
tirely the result of short covering.
Railroad stocks failed to respond to
the enthusiasm created in other groups
on Wednesday and again yesterday
morning. Shares of the carriers were in
free supply and while there was no
particular pressure directed against
them most Of them declined. The re.
port of the Interstate Commerce Com.
mission. in which was refuted the claim
Of would-be rate cutters that present
rates are a bar to business. had little
or no effect. As q matter OF fact II
could not be expected to. for the COM
mission long ago recognized the neces-
sity for maintaining freight schedules
It was not fear OF adverse action by
~
railroad stockholders to dispose Of their
shares. It was a dfstrust Of the reac-
tionary element In Congress and a fear
that new legislation may be 1ammcd
through which Will put the carriers hack
under the control Of the, various State
commissions. This, railroad men de-
clare, would be calamity, and. much as
they chaff at the restrictions imposed
by the Governmental body, they hold It
far preferable to a return to the old
system
While there have been many who have
been nvstified regarding the action of
the railroad stocks, It should not be so
puzzllng. The public interest In these
stocks is nowhere near as great as Is
generally believed. In fact, II is sur
prising1y small. Professionals control
the movements of the railroad stocks
Pools which have been operated In re-
cent months in shares of various car
riers have in many cases failed to dis
tribute their holdings to the public be-
cause Of this lack of public interest In
that department. and as a result the
pools have been dissolved with large
amounts of stocks on,their hands
Railroad investments in this country
constitute about 80 per cent. of total IN
vestments aside from Government Sc
curities. but trading In railroad shares
this year, nevertheless, has amounted
to only 20 per cent. or less Of the total
volume OF stock transactions.
Foreign exchange rates again moved
upward. sterling getting above A.57.
Since the first Of the year exchange on
London has advanced more than so
cents. about 10 cents of this advance
having occurred since November 1 and
about 6 cents since December 1.@ One
explanation which has been offered for
the anomalous weakness at timer OF
certain Continental exchanges. while
British rates were advancing, is the per-
sistent purchasing of dollars and OF the
pound sterling by other countries that
see their money depreciating.
The f'ench Bank statement unfor-
tunately showed another Increase of
270.000000 francs In circulation and at
the same time an advance OF about S00,-
900. 900 francs In the Governments bor-
rowings Much as the French Treasury
Department wishes to curtail It's obliga.
tions to the State bank. 1t seems to find
II very difficult to do so.
Bonds did better In reflection of the
low rate of interest on the short term
certificates to be issued by the Treas
ury. A rate Of AZ per cent. had been
expected on the one year certificates In
many quarters. Gel money was in sup
ply at per cent. an day. Cotton main
tained the firm tone of tho previous
days market.