The New York herald., 1922-11-15
FINANCIAL NEWS
AND COMMENT
Stocks and Bonds Recede Again
Bull Market History
Repeating Itself.

Movements IN the financial markets
yesterday were almost Identical with
those OF Monday. Stocks and bonds
were exceedingly weak. The same in
fluences were at work and about the
same results were seen as on the preced-
fng day.
International bankers stin maintain
that the Turkish situation has abso-
lutely nothing 60 do with the break in
the stock market. They point to the
fact that foreign exchange holds and
even advances as proof of their con-
tention. The extraordinary weakness
In securities is. and has been, nothing
moro than the correction OF an overdone
speculative position after months and
months Of rise which aggregated In the
industrial averages more than 40 points
| Viewing the present position OF the
stock market from a purely speculative
angle, much attention IS being paid to
the charts of previous bull markets in
the last twenty years or more. A re-
view OF these charts shows that almost
every upward movement, after It has
progressed about 40 points, has been IN
terrupted with q reaction which has run
anywhere from i2 to % points before the
upward swing has begun again. So It
is plain to be seen that from the specu-
lattve viewpoint--and that Is the only
viewpoint from which charts may be
read---the great downward movement is
directly In line with the history OF mar
kets Of the past
There is absolutely no change in the
fundamental situation as IL governs the
movements Of securities Expansion of
business and Improvement of Industrial
conditions all over the country continue.
Steel plants are increasing their opera
| tions and the weekly reports of new
business which they are taking certain
ly furnish no basis for expecting any
led down at this tino. In fact, there
Is every reason to look FOR progressive
improvement over a period Of at least
six months.
or course, the European economic
situation could be vastly better from
the standpoint OF American Industrial
growth. Every nation on the Continent
needs American products. but they are
unable to purchase anywhere near their
requirements by reason of their impov-
erfshed state. II the European markets
were thrown wide open tomorrow TO
Apnavfrnr fv,Ht a.
chasers were In position to come into
our market for all their needs, the in
dustrial and railroad facilities of the
nation would be inadequate, and 1t is an
open question whether such a condition
would be of real sound benefit to the
United States.
There Is no doubt that tho action Of
the stock market yesterday represented
tho urgent liquidation OF stocks from
those traders whose margins havo be-
como impaired and from those who are
disgusted with the present situation In
the financial district. In the bond mar
ket foreign bonds and speculative rail-
road and industrial issues were the
weakest feature. All Erie convertible
bonds made new lows. French bonds
were particularly weak.
Foreign exchange, hewever rated very
well in the days markets. Sterling rates
declined slightly, but French and Bel
gian francs both continued their advance
Of the preceding day. italian lire were
somewhat lower.
Grain prices made substantial gains.
December wheat getting up to 1.1S and
December corn selling above 20 cents.
Profit taking in the cotton market
checked the advance In that commodity 4
Call money on the Stock Exchange
again remained at 5 per cent.