Evening star., 1923-03-10
Wall Street Price Advances
Proving Puzzle to Traders
Many Fear Rise Has Discounted Trade
: Inprouen,ent-Concern Over Money
Rates--BOnd Demand Slack.

This situation necessarily has result
ed in more or less rapid advance in
prices. But the point Is that the ad-
vance has not been aggravated un-
duly by speculation. Rather 1t has
been the logical result Of the abnor-
mally depleted stocks on hand as they
| stood in the summer of 1921.
Consumers persisted in buying from
hand to mouth-that is. covering only
Immediate requirements, because they
could not see the business recovery
that lay ahead. The sequel was that
they were caught short Of supplies
for future use when they at length
awoke to the fact that the tide had
turned.
Labor shortage Pressing.
At the moment one Of the disturb
ing problems is the scarcity of Dor.
unskilled as we'll as skilled. for which
the restrictions In the new immigra-
| tion laws may be thanked. This
threatens TO lead to q general press
ure for higher wages. In fact, there
Is already talk Of wage increases;
particularly In the iron and steel and
textile industries. II this happens the
whole vicious circle will begin to
operate over again, higher wage costs
leading to higher prices. hi CHER prices
to higher cost of living and nn@t"e
with renewed demand by the laborins
class for fresh upward an" ..'...'s
in their pay. 1t would seem from the
standpoint of the security markets.
as well as from that of the business
outlook in general. that there could
be no more unwelcome news at the
present time than the announcement
| Of such a series OF increases in wage
| scales.
slack Demand for Bonds.
Another matter to consider more
I seriously is the let-down in the de-
| mand for investment securities. This
! has steadily become more of a fea-
ture during the last six months. but
| it has been particularly emphasized
during the past week. To the extent
that the weakening of the investment
| market is due to higher money rates,
present and prospective, 1t is not
especially serious
But to the extent that It Is due to
the enormous output of new Be-
| curities, 1t is subject deserving
! more attention. The suggestion IS
that If new Rotations keep on as they
have been. without regard to eyi-
dences OF safety in the investment
demand. tie market will become
| owe rstocked with securities which
Will be very difficult to SELL
British Finances Improve.
The latest reports about business
conditions abroad are encouraging
save for the countries directly affect
ed by the Ruhr trouble. Great Brit
ain. in only three weeks ending Feb
, ruary ~. had an excess OF receipts
over expenditures Of $2S5,000 900. A
budget surplus is assured at the close
OF the fiscal year large enough to
warrant further reduction in the per-
sonal income tax and the possible
extinction Of the corporations profit
tax.
Improvement continues in italian
finance and business and within the
last few months Czechoslovakia, has
had remarkable change for the bet
ter. All this would mean much for
Americas foreign trade If Il were not
for the doubt regarding our future
price levels. AS il Is even now, the
rise in prices has been so much great
er here than II has in Europe that
we are finding II increasingly diff
cult to compete with other countries
in the export markets.
Copyright, 1927