The New York herald. [volume] (New York, N.Y.) 1920-1924, 1922-09-28
FINANCIAL NEWS
AND COMMENT
Heaviest Selling in Some Time
Is Developed by Several
Bearish Factors.

The unsettlement and uncertainty
in the financial markets for ten days
reached climax yesterday in a smash
OF security values. particularly in the
stock market, which brought many IS
sues down to levels that have not been
seen in months. In the bond market,
too. there was extreme pressure, and in
the, Liberty group heavy selling featured
the days business. Cotton declined
sharply and foreign exchange rates
moved into lower ground. In the grain
market alone was there any buoyancy,
wheat prices moving up to ITO for the
September option, an advance of more
than Q u points.
Banks and other big institutions and
corporations have been big sellers OF
Liberty bonds In recent sessions on the
Stock Exchange for two reasons. In the
first place they want to get in @ posi-
| ton to handle their proportionate share
OF the Government financing to come
financing which. it is believed. will total
at least $1,000. 600, 900, and may run
as high as double that amount. Then,
| too, most of them had substantial prof
| its in their holdings of Libertys, which,
they felt. it might not be unwise to
take in the face of the new financing.
| Various rumors concerning the pro-
posed Government undertaking, such as
tax exemption feature, &C.. have
added much to the unsettlement Of the
] situation in the bond market. 1t is a
| question, however IL the Government
will dare cut or a very important item
of revenue by issuing such q huge block
of obligations In tax exempt form In the
face of the hugo deficits ahead. What
| is more likely Is that the new issues
will be made more attractive by maxi
| Ing the interest rate substantially higher
than the per cent rate originally talked
| of. Transactions in the bond market
yesterday ran around s21,000,o00.
The sharp break in stocks did not
| take by surprise those who have been
watching developments closely during
the last ten days. The persistent pres
sure during that time was bound to
| have its effect and with confidence in
| the market severely shaken for the mo-
| ment there was an absence of buying
| power. which made easy the efforts of
the professional clique which was seek
| ing to put the general list to lower
levels. Several points In leading stocks
which have heretofore been points OF
resistance were broken yesterday, and
this was regarded as decidedly ominous
| by those experts who base their views
| on charted movements. Baldwin under
| 131 and United States Steel common be-
low 101 were regarded as especially sig
nificant in those quarters.
Several unfavorabie developments in
connection with certain stocks were i'm
portant factors in the general decline.
The passing of the quarterly dividend
on Pittsburgh Coal stock came out of
a clear sky, and Notwithstanding state
ments from directors to the effect that
the step was one of INSTRUMENTATION
and that the dividend could have been
paid without difficulty, heavy selling of
the stock broke its price ten points.
Announcement that the Ann Arbor
dividend would be deferred at this time
broke the preferred stock OF that road
some six points to a low of IL. Other
stocks which suffered moro severely
than the general list were those In
which rampant speculation in the last
few days has ignored the general heavi-
ness. Gulf States Steel, which broke
more than six points was one OF that
group. Another was Coca Cola. which
declined full three points from its
high.
Standard Oil stocks were much in de-
n1and in the early trading and several
OF them followed 10 their sensational
gains of Tuesday by making new high
records. Standard Oil OF New Jersey
sold above 200 for the first time. But
the way in which they declined later in
the day suggested that the greatest
part of the buying earlier had been
done to create an appearance OF strength
while other stocks were being heavily
sold.