Evening public ledger. [volume] (Philadelphia [Pa.]) 1914-1942, 1922-12-02
|IIIRTHER RECOVERY
!; N STOCK PRICES
Internal Conditions Rema'"
chief PropeIIing Force OF
Market Movements :.

New York. Dec. 2.-Stock prices con-
,,.,od ,o move to higher ground III TO-
... hricf session OF the stock market
~ ~ tur,hcr correction of the over'ex'
..rJcd shor, position developed during
~. reccut reaction. Some exceptional
~, ". wcrc made by a number Of spc.
sa.,;,ies. with representative shnrPs.
.,"r =" Iiiyh grade railroad shares
n.s gs hourLt freely. and there was an
Me,v uo,.cJ volume Of speculative opcin-
lions in industrinls. ,,
''o.s su " weakness in tntcrna iona
u.ry"s,er. which dropped . points.
i.i,.J to unspttlc the rest Of the list.
! !.n%,uvh n few other weak spots do
r.Ii rr.I"usi from profit taking. Woolwort!l
w'srd ,as depressed ! points. Fisher Body .
,rI New York Central. Tnn~Amcrican
" "nJ Associated Dry Goods ] each.
'"S S,mc Of the outstanding gains in
.,ndrl American Snuff. up 10: All.
amcrica Cables. ~ /: National Cloak
AMI ] Suit. ;: United Fruit. 3H. and
nmoha and S'tudrbakcr. ! each.
Internal conditions continued TO gov.
s,n the movement Of the stock market
this week and once again little relation
csnld possibly BE- established between
tSe doily ryratiUns and outside condi
t;ons. In other words. the position Of
hs market is practically reversed fron,
that existing up until the latter part Of
october. That is to say. for nearly
ioartpen months there was a persistent
Climbing Of market values on prOspcc.
live bcttermpnt OF industrial and com.
mercial conditions. Now. when many
n these anticipated good things are
fsst becoming realities. security values
are crumblng. The about face turn
has not come because of long distance
yiSv Of an adverse change IN the funda.
mental. or economic. situation, but he.
cause those who attempted to discoun,
the better business conditions over.
reached and erected finlsy speculn.
tive supcrstructure that was certain ~
topple when anything should occur to
disturb b tho hastily rugged and weak
nnderninnings, The shoreing was un.
scientific am, contrary to better engi-
ncering principles.
Countless numbers Of excuses nnd
ordinations have been offered for the
sudden colapse Of the speculative
structure. Wall Street must always
lind reasonable theory. or excuse. ,Or
All ifs notions. Naturally, the nearest
and most plausible reason is therefore
altered. In consequence. little discr'm.
ination is shown in placing the real
hlamc However. when the smoke
clear, away it will be found that the
violent slump, which. in sense. was
merely n technical one. was aggravated
by tho weakness of several houses and
a number Of speculative combinations.
and also the forced selling Of very
large blocks Of stocks by n number Of
other houses that the stock exchange
authorities, through the medium Of the
much .dpspisCd QuestiOnnairr. found
were carrying more stocks than their
c,pital warranted. Undoubtedly, a con.
siderable number Of innocent marginal
traders were caught in the vortex. Cn-
derneath the unpleasant side is found
the Great satisfaction that Il safer and
soundcr market is hcing constructed.
with trading principles built upon q
tounder and sancr foundation than has
existed in many years. \ condition, III
fact which gives reasonable assurance
Of avoiding a recurrence Of those disas-
trors, and oftcntimes nauspnting, cxpe.
rienccs Of the past in brokers' insOf.
yencies.
At the moment. there is diversity Of
opinion ns to the adjustment Of the
speculative position. In some quarters.
and these comprise generally Lowell.
headed observers. belief prevails
many Of the representative shares are
humping bottom. Not that they believe
a resumption Of the constructive move.
ment Is in making. hut. because Of the
readiness Of the benr element to help
the reaction along. the market is over.
sold and technical rally is in order.
Another element consider the only
prorelling force Of recovery must be
derived from the short interest and the
elimination of the bear account would
simultaneously deprive the market Of
It's artificial support and leave il again
vulnerable. In supporting their victory,
they point ont those interests who took
over weak accounts nat,fally would
take advantage of nll rallies to sell as
much Of those stocks ns the market
would take. They further assert ali
the sore spots were not eliminated by
the recent shakeOut. and it is highly
probable that Just as soon as the gen.
sral list shows signs of hesitating, re-
newcd pressure will appear in the
weaker and non essential issues whose
net returns have been poor.
Both theories are open to considera.
ton md acceptance. Possibly the best
advice under the circumstances would
pe not to get too enthusiastic on either
ade OF the game.