Evening star., 1923-10-20
by STUART p. WEST.

Special Dispatch TO The Star.
NEW YORK, October 2e.--Wa1l
street has made progress this week
toward a saner view of the business
and financial outlook.
1t has begun to get rid of the in
discriminate pessimism in which 1t
was indulging. and to recognize that
unfavorable conditions which exist in
certain Industries do not apply to the
situation as a whole. The markets
have felt the effect of this change.
Stocks of companies In an unsatis-
factory business position have con-
tinued their downward adjustment
without preventing others more for
tunately situated from moving up.
Where, as with the steels and railway
equipments, the trade prospect is
more uncertain, the related stocks
have been doing little more than
standing still.
Business Proceeds Cautiously.
This is quite as it should be in a
market which is gradually resuming,
after an interval of unreason. its
normal function of interpreting out
side conditions. Production has out
run consumption in certain lines-in
oil, In automobile tires, In boots and
shoes and leather-with resulting de-
cline to Improbable or losing prices
But there has been no general ex-
cess. The business community has
not recovered from it's bitter lesson
or three years ago. 1t is going to
an extreme of caution in buying only
for Immediate requirements. in refus-
Ing to load up with goods which
later on 1t might find itself unable to
sell at profit.
m
But while this gives rise to an
atmosphere of more or less uncertain
~. 1T Is not sign of weakness.
Merely supplying the current demand
ana not counting much on forward
orders, means a very wholesome busi-
ness volume as all the accepted data
go to show. Moreover, inasmuch as
there is-with the exceptions noted
no big surplus production to work
on, there is nothing to suggest the
movement being interrupted. The
check, If 1T were to come, would come
from the outside-from ill-advised
agitation in Congress. or because
business men got 1t into their heads
that there was danger Of a radical
program winning out in next year $
presidential campaign.
Higher Costs Not Detrimental.
Just as the relation of consumption
to output differs widely as between
lilduSIEieSs SO uOeS the
problem OF high labor costs. The re-
tail trade has been able to absorb
these increased expenses without diff
fculty. compensating itself by advanc-
ing prices, but not enough to be felt.
In the manufacturing centers wages
have risen more than the things which
the wage Garner has to buy. In the
agricultural sections, outside the
wheat territory. the same thing is
true. The rise in farm prices has out
stripped the rise in most articles
which the farmer needs. The farmers
buying power is therefore larger than
it was a year ago. These are the rea-
sons why in the general diStributive
trade higher costs have been no deter
rent. 1t has been easy to pass them
on 10 the public.
Competition Forces Prices Down.
Where there has been an overpro-
duction 1t has been impossible to
make good higher pay rolls by raising
prices. On the contrary. as we have
seen it in the oil and tire industries,
the competition brought about by the
excessive output has rapidly forced
Prices down. There are other in
stances where there has been an APP
parent overproduction and yet a
considerable increase in wage sched-
ules where the result of the attempt
to make the consumers stand the ex-