The New York herald., 1922-02-04
FINANCIAL NEWS
AND COMMENT
Rail Shares Rally Vigorously
on Hoover's Rate Argument
Call Rate Lowered.

| The stock market found In Herbert
Hoover's observations about freight
rates before the Interstate Commerce
Commission yesterday. material which
not only fitted in well with it's mood
about the course OF prices but also with
| financial opinion generally In respect to
the railroad situation. In consequence.
there was vigorous rally of rail
| shares. which, supplementing earlier
upbidding of industrial shares, impaired
decidedly strong tone to quotations.
Little attention was paid to the ease
ment of the call loan money rate from
51a per cent. to Az per cent, as that
movement had been expected to follow
the back flow of January 1 dividend
and interest payments into banks and
temporary lending of balances. built up
as the result of subscriptions to Treas
ury notes. The markets have become
used to fairly broad fluctuations of call
money and in consequence again are
position OF time funds. commercial
paper and acceptances. Those forms Of
accommodation remained steady yester-
day.
Mr.. Hoover's opinion about the
freight rate structure was, in essence
that although low charges are desirable
as a stimulant to business. they must
not be cut in a way which would impair
the powers OF the carriers and should
be reduced in direct proportion to the
fall Of wages and other operating COSTS
Such has been the attitude of bankers
and railroad managers and 1t Is worth
noting in passing that more comment
along that line has been seen in the
public prints OF late, coming from ship
pers and others affected specifically by
rate costs, than appeared during last
summer and autumn. when the princi-
pal urge in labor and shipping quarters
was to force rates down irrespective Of
the movement of wages.
| The more important advances among
the rails were recorded by Great
| Northern preferred. Missouri Pacific
common and preferred. Norfolk and
Western, Pere Marquette, Texas and
Pacific and Union Pacific, which rose
a point or more. Many other issues.
although not so strong as the leaders,
were, nevertheless. fractionally higher
than they were on Thursday and their
best quotations were established late
in the trading period. Doubtless spe-
cial influences were back of several,
including Missouri Pacific preferred,
which was affected by rumors of a
possible dividend payment, but the ris-
ing tendency evidently had more sup
port than casual operations of specu-
lators. Among the industrials. the hand
of the professional trader was again
plain to be seen here and there, but
| as his efforts were partly offset by
| realizing sales. there were few sharp
bulges OF specialties such as marked
trading earlier in the week. Automo-
bile issues were in demand and also
tobacco and certain steel shares. Steel
common at 81 was higher than it was
at any time last year and was separated
from its best quotation of last month
by point.
Liberty bonds receded, but the volume
of transactions grew smaller as prices
softened. Bonds of New York transit
companies went forward. AS a whole,
the corporation bond list was firm. the
best front being shown by railroad is
sues in the afternoon.
| Once more sterling went to a new high
level. sight drafts being quoted at 1905
at their maximum. Natural profit talk
ing sales were brought out by the
weeks sharp recovery. but the market
suffered no material impairment and
other European rates were fairly
steady. The further vigorous rise OF
wheat futures. amounting to cents
bushel. evidently was aided by the posi-
ton of sterling, as reports of meager
| supplies in the United Kingdom and
an exchange movement. which enhanced
the purchasing power of the pound in
America. was productive of speculation
for the rise.