Great Falls tribune. [volume] (Great Falls, Mont.) 1921-current, 1922-05-27
RISING BOND MARKET CONTINUES
WHILE MONEY RATES REMAIN LOW
IS OPINION OF ROGER W. BABSON

Wellesley Hills, May 26.-In view
Of the peculiar way that the stock
market has been acting the past few
days and the various rumors that are
about regarding the great steel merg-
ers, we have sought the opinion OF
Roger w. Babson concerning the same,
80 far as the long swing goes" says
the statistician, Everything looks well,
both for the bond market and for the
stock market. We are entering into a
period of low money rates which may
extend owe some years. If SO, the
bond market will continue to climb up
ward for a similar length Of time. This
does not mean that bonds will advance
as much next year as they have ad-
vanced this year., nor as much in 1924
as they will be in 1923. Moreover, re-
actions will occur now and then. The
general tendency, however, should be
for a strong bond market for several
years.
"The stock market has not yet reach
ed it's zenith. Those who have bought
securities and have them in their boxes
should not worry about present mar
ket movements, or conflicting rumors.
We have only started on a great broad
movement in the security markets
which will take both bonds and stocks
to much higher prices. The United
States of America has always been a
great country; but today it is the center
of the worlds production. distribution,
and financing. If it is two years be-
fore we are back again in another per-
iod of prosperity, it will be two years
before the stock market turns on its
great trip downward.
THE stock market, however, is like
the ocean. In addition to the great
tidal movements , there are squalls.
storms, and periods of calmness and of
rougbness. The stock broker watches
a certain barometer as does the ma
riner at sea. This barometer strongly
suggests today that there may 500 be
a storm in the stock market. 1t looks
rather cloudy and at points there is
pressure which is not natural. The
optimistic toni which has been char
acteristic of the market for many
months has temporarily gone. The
rumor-mongers and tipsters are again
doing business. Insiders who have
been accumulating for some months
are known to have distributed their
holdings. They are now waiting for a
s~hake-down and another chance to get
aboard before the next upward move
ment.
hegdrQlHR the TepoFteu steti WcTS-
err" continued Mr.. Babson. Il will say
that there has been much talk about
this, so much so that it looks as if GER
tain parties were using it for window
dressing. The capitalization of the
combined Bethlehem and Lackawanna
companies is about 100000, 900. The
combined capitalization of Midvale.
with Republic, Youngstown, and other
companies proposed TO merge is about
$3.50, DOC, 900. Thus if the entire con-
solidation goes through it would mean
a Capitalization of about S550.000,0 900.
1t is preposterous to claim that this
is all equal revival of the United Steel
corporation which has today a clear
of about one billion and a
half dollars.
when the earnings are considered
a similar condition will be found. For
instance, for an average period of
years the Bethlehem and Lackawanna
show gross earnings of about $350.00O,-
900 while the Independents mentioned