The Birmingham age-herald., 1923-04-23
LIVE ERM0RE GIVES NOTE OF CAUTION
 IN STOCK MARKET
Many Municipal and County Board Offers May Prove
 lrkSOme
By WALTER B. BROWN (Editor New York Commercially

{Editor New York COmmerciai,D
 Especial Dispatch to Age -Herald)
 NEW YORK, April 22.-Jesse Liv- ermore, who is noted as stock speculator, sometimes on the bear side and sometimes on the bull side, has sounded note of caution. He warns those trading in stocks to make a distinction between seasoned securities and those which have lately been put upon the market It does not follow that recent flotations are to be condemned for many Of them are altogether admirable. The market has. however, shown q ca pacity for absorption of almost any thing that was offered. and there are bound to be some of the eat and dog variety.
 Furthermore, there is such d vast amount of these new securities that a large portion of them are bound to remain undigested for some time at least, so that when investors under take to change their investments to those of more seasoned varieties, they may not find such ready mar Ret Tor tneIr hOlulnSS NeW buyer ;, therefore, should use due discrimina- ton and be sure they know all about the concerns whose shares they are investing in. Some of the concerns recently floated are making excellent shoWingS on the basis of boom de- mand but there must be considera- ton given to what their earning ca oacitN is likely tu be when the edge s taken off the present activity.
 In somewhat similar category are to be reckoned the tremendous offer lngs of state and municipal bonds. Because of their ta. exemption fea- lures. they find ;t ready market and offerings that could hardly be floated at all in former times are disposed Of without the least dit ticulty The re- suit of all this is .tn eXtravaEance of expenditure by communities in . that it not only ties up captial that could be more usefuDy employed in regular industrial channels, but It imposes a burden of taNatop upon the communities that in some ln- stances is staggerins X typlcal m stance is community of some 4,ooo inhabitants with comm utlng distance of New York city and popu- lated by a generally wc1l-tC-do class including some of the very wealthy. Not content with more than douoiihe its elementary school facilities, II mas built a high school worthy or a com mun1tY 1Ouf or IlNt tiiiies it.' N'"N. is a fine building with all modern equipment except scholars. in order to obtain which it offers special ln- ducements to the surrounding com munities. The result, however, IS a tax rate that has almost Killed new building enterprises ana mas ,'i,st inir rents up to figure that IS almost prohibitive Newcomers are frlsht- ened away and the growth or the community has been seriously checked.
 Warns Of Tax Burden.
 Communities that are not so well ahle to bear the burden of taxation have nevertheless, gone aheau "leh public enterprises that could Just as well have been deferred. There may be instances where in the course or lime interest will be defaulted but the danger from this is not so much to be annrehended as the hardship that will result for years to come tc' com munities where the tax puiueH io heavy. The remedy is. of course, the nassape of the proposed constltu- tional amendment prohibiting states or municipalities or even the federal government itself from issuing tax exempt bonds.
 Within the week the government has m de an attempt to bring to an end trading in sugar futures on the New York coffee and sugar exchange, the case to be argued in the federal court on April 30. The charee IS made that the recent advance m the price of sugar is due to specuiatloh nn this exchange. The adminlstra- tion seeks to disprove the charge that inc advance is due tG the tarlil. AS a matter of fact, it is due to neilher. If is the result of a belief that tne supply of sugar is snort. Ihe au vance caused by the tariff is only the fraction of a cent and would De ,naiotained whether prices were on higu level or low level .
 If the tariff were responsible, It ufuld be because 1t had operated to reduce imports. In that case sugar ,yould pile up in Cuba and the price of raw sugar would decline. instead ii is now selling at about 5$4 cents -a, against 3 cents last year, and one central after another is closing down because of lack of supplies. me au- vance in raw sugar has been about 2i. cents a pound since the ilrst oi Januarv and about cents pound for refined It is nowhere near war levels. L.,
 The attack upon the exchange py t,e government cannot possibly ar feet the price because speculation cannot have more than monetary effect. The attack is likely to have inc effect of causing consumers to hoard supplies, thus forcing prices to still higher levels, and after this de- mand has become saturated, It Will be followed by collapse.
 No matter where you live