San Antonio light. [volume] (San Antonio, Tex.) 1911-1993, 1923-04-29
BONDS MAY Be
AFFECTED BY
LEGISLATION
Action Of Congress Toward
Railways May Influ-
ence Future.
FOREIGN BONDS RISE
Several Issues Make Re-
markable Advance
During Week.
BY BYRON SELLERS.

BY BYRON SELLERS.
Copyright by The San Antonio Light.
| New York, April 2s.-Any attempt
intelligently to forecast today the fl
; nancial and commercial future meets
at the outset two problems, both politi.
cal in nature.
The first is, what will be the atti.
tude of the American government and
the American people toward recon
struction in Europe and the second is,
what is to be the attitude of Congress
and of the labor and agricultural in.
terests toward the railways. These
two problems are fundamental.
More or less in regular course reac-
ton follows trade activity and revival
follows reaction. And the factors af-
fecting each may be weighed with
more or less precision, but there is no
way of forecasting the solution of q
political problem. Perhaps that is not
quite accurate. In the long run, his
tory shows the American people have
always found the correct answer to
political questions when once fairly
and adequately presented. 1t is still
true, however, that these matters do
not lend themselves to exact analysis
as do purely economic propositions.
Foreign Situation Improved.
Now as to affairs abroad, the weeks
developments have been distinctly en-.
couraging. There is every sign that
the responsible leaders realize that
prosperity in this country depends, in
a measure at least, on stability abroad
and that foreign markets for our sur
plus cotton and wheat are vitality i'm
portant.
As to the methods of cooperation
with Europeans there is still, of course,
violent disagreement, but this is not
the place to discuss merits of the dis.
pute.
1t is sufficient to point out that
more and more interest is being shown
in the European situation and that
the pessimistic view as to the outlook
is no longer predominant.
The remarkable advance in the mar.
ket for foreign bonds this week testi-
fies to this fact. 1t is doubtless true
that good deal of the buying of these
securities has come from abroad, but
some of it is certainly due to the in.
creased confidence of American inves.
tors in foreign securities, confidence
which may grow until it is possible to
sell in this market even the obligations
properly endorsed, of reconstructed
Austria, a suggestion publicly made
this week but which would have been
ridiculed three months ago.
Rails DO Not Advance.
The mere fact that the possibility OF
new foreign financing being done in
this country is discussed shows a
change Of attitude. If by any chance
Germany and France should come to
some agreement, this new born favor
able sentiment toward European in
vestments would be enormously stimu-
lated. The extraordinary returns Of
fered by the bonds of some European
| nations at present market prices
would prove irresistible to spectators
as well as investors.
1t would be gratifying to be able to
say that progress similar to that made
abroad is being shown with regard to
the railways, but such is not the case
Here, too, the judgment of the market
may be accepted as reasonably accu
rate. Those whose business it is to
advise on speculation point out thai
railway stocks have not had the ad
vantage enjoyed by utilities and indus
trials in the bull market of the past
year and half. They urge purchase
of railway shares as likely to be more
profitable at this stage than similar
commitments in industrials. All the
statistical evidence is on their side.
Car loadings are at new records fol
this time of year and not far below
the best for any time of year. Earn
ings statements for March show graft
flying gains over year ago. Granted
a continuance of reasonable prosperity
the superficial view would be that, Fl
nancially speaking. the railroads hav'
the worst of their troubles behin'
them.
But the railroad stocks drag alon,
at their previous level and railroad
bonds are even more dormant. Thi
applies to second grade and specula
tive descriptions which would be nat
urally affected by earnings rather thai
to high-gradc bonds which are respon
sive only to changes in the money mar
ket. Some of these second-grade bond
combine good security. very Favorable
earnings and yields of G to per cent
but all to no purpose as far as attract
ing speculative investment is con
cerned. What is the reason? TIL,
only answer can be concern over thu
political outlook.
General Situation Unchanged.
The general financial situation re
mains much as last week. III bust
ness expansion proceeds Mt n rockies
pace it will not be for lack of ade
quate warning. Henry Ford ha
Joined those who have been advising
caution.
Meanwhile, with the exception o
wool and sugar, prices do not seem in
clined TO advance. The case of suga
is the more notable because of the ex
traordinary means adopted by the gov
eminent to force decline. The bank
ing position is just as strong as ever
Credit is still available for all legiti
|, mate needs. Speculation in stocks !
at low cbb and not excessive even i
| commodities. The labor shortage abou
. which so much has been heard is a
, least no worse.
One curious feature Of the annua
reports of the railroads has escape