The evening herald. [volume] (Albuquerque, New Mexico) 1914-1922, 1922-06-17

time IA "A top-hcavy market, such
a factor would have been conducive
TO an extraordinary demand tor
speculative stocks anu a general
,.sn.canng OF prsccs. But with
the market ~ the end OF a long
swing upward and with profession
setting the margct ON "a very neA,y
Acaic, a fractional difference la
money raies eds a very sinai.
IIguFe.
one Of the most difficult lesson
FOR spectators to learn ~ that All
major swings In the stock market
are accompanied by Temporary set-
lacks. some OF them nttsinE iron.
natural causes and some 90 ta.m
skIlfuiy engineered by the pro
tczsionnl keners whose entfrc at
tcntion 10 devoted to trading In tho
stock marker Al ls Il fauacy TO
ttatc tnas those professionals are
able To control or direct The course
OF prices. 1nclr experiences cun.
sista OF their abii.ts to take I'D
Naneagc OF sne natural SWING IN
the market rathcr tiinn to create
them.
Money
Some curious problems are being
Introduced by the action OF tho
money market anu tnc movement
OF money rates. one IN M utt.tuac
OF business mon who have a sur
plus OF funds ygaicn tney cannot
probably employ la then own en-
terpriser. 1nc qucsson N. ahnii.
they allow thcse ninaa % remain
Idle, or Use Il Tor The purchase OF
hIEn grade dlyiuana steeiss or TAX
exempt bonds.
Another problem that has been
largely discussed In recent weeks
~ tina OF the probable future
course OF federal reserve bank re-
discount ratcs The fact that the
rates for four-monthF bankers ac-
ccptnnccH have fallen to 3 IA per
cent sh,ic rcu.srount rates have
bcuh stationary at . ~ pes cent
since las November IL strongly nuE-
gcatiye Of the feasibility VI a ca, IN
the latter. Merchants paper sin
brings 4 ~ 10 = l-z pee cent. IN
the open market, bu; ~ .he bank
rate were reduced 10 4, the prob
ability h. that street rates would
fat with u and tnat no more would
hc r-cdiscountcd than before. Mean
time. The continuous reduction Of
-roaiscounts Is pacing some reserve
banks In a position whore their
earnings are being cut almost TO
the line OF expenses. something Of
tho same problem eAlst with the
private banks. or would exlK. "
time money and mercantile paper
rates were 10 fail below : pcr cunt.
Itond Market
Once again the bond market has
developed an opposite trend 10 the
primary factors In money ani
business when usually intluelcc
the course OF bond prices. Tho
stump which occurred about the
middle OF May was attributed to.
the large volume OF new offerings
which flooded investment channels.
but during the last three weeks tho
amount OF new bonds has bssin
comparatively small.
At present there are a large
number OF first class railroad ANA
industrial securities that are selling
from Z to b points under the hign
les iH attained In the nfst week in
May. This ls attributed partly To
the liquidation OF professional bond
traders and partly 20 the unccr-
tulnty Of railroad earnings because
OF the coal strike and the recent
paring down o. freight rates.
II ~ characteristic OF the bond
markc, that high coupon rates have
been gradually disappearing, and
borrowers r able 10 obtain more
favorable terms ON now loans that
are acceptable TO the market. This
applies not only to domestic In
duHtrinl bond issues. but also Ia
foreign govcrnmen. bonds. which.
however. have not been 10 album
dant tn recent weeks. While nrgo-
lotions Tor the German intcrna-
tionni lean have hecn temporarily
abandoned. conferences with fairly
rrpfifying results have been con-
Quoted with tho Mprican financ.
minister at New York.
Trnde and Industry
Latest reports from the world
OF tradc aud industry indlontc sat
isfact0ry progress along the road
TO resdlust mcnt. Copper and steel.
textiles and rubber, cotton and
wheat markets have their individual
problems. which they seem to be
able to handle Without difficulty.
New hifgh prices Tor cotton, with
simultaneous decline In grain
prices are accounted for by the
supply of and demand for the rr-
spcctiVc crops Railroad freight
i%Dadlngs make a favorable display,
and now equipment IN heing ac-
lulred by the carriers at the
largest rate since tho armistice.
Although 10 n Htiit Two weeks he
fore the current quarter end. Wall
Street has started TO make pre-
dieiionh aa to what the United
8iates Steel cpruoration viii show
10 b way OF earnings when the
inarterly report n published In the
ias; woek 81 July. According 10
the latest estimates. not earnings
To- eNcosH 90 $40. 0bO, 900 are OK
pected. This would compare with
net IL sis.235.9Sb In the first
guarter of The curfent yesr and
tzi. 1913 ~ the second -qupster.
% last year. Tho Improvement in
The steel Industry has been u%nusunl
~ fnrru since The boniuulnn az The