The Birmingham age-herald. [volume] (Birmingham, Ala.) 1902-1950, 1923-06-09
STOCK MARKET IS
LITTLE AFFECTED
BY BIC FAILURES
Illegal Bucket Shop Opera
tons To Be Stopped,
Expert Declares
By WALTER b. BROWN,

BY Leased Wire to The Age-Herald
NEW YORK, June s.-Although
the recent failures of several promi-
nent curb market houses have been
Of an extremely spectacular nature,
there is nothing to indicate that
there will be any repercussion upon
the economic structure. Dealings of
these houses are usually of a highly
nebulous character, eliminating the
necessity of forced liquidation of
any considerable amount of stocks.
AS a matter of fact, the withdrawal
of houses of this class is bound to
work for the improvement of the
leading speculative markets. Opera
tions of bucket shops serve only to
breed dissatisfaction with the in
vesting public, which seldom, If ever,
receives any profits on It's transac-
tons with such houses furthermore,
bucketing of stock orders which 9TH
erwise would be executed eliminates
from the open market one of the
fundamental bases upon which the
principles Of a free and open market
depend.
Others VIII Close.
1t is understood that a few other
stock houses which have been con-
Quoting their business on an unsta
BILE and probably Illegal basis will
soon be closed.
1t is decidedly significant that de-
spite the failure of Jones & Baker,
the largest firm on the curb mar
ket. and L. L. Winkelman, the second
largest, the stock market has gone
serenely on it's way.
If there is a slump in business, as
SO many alarmists seem to insist, it
has not manifested itself as yet in
the railroads. For the past six weeks
the stock market has been lombard
ed with .rumors and reports that have
been nothing short of deliberate
propaganda. but which have so far
unsettled public confidence in secur-
lty values that stocks have been
subjected to drastic declines. Steel
common, which is pretty good in
deX, sold week ago below 95 as
against 1095s in March. Yet right in
the midst of this raid on the stock
market. the railroads established a
new weekly record of freight load
ings for this season of the year, the
week of May &c exceeding million
cars.
Only twice before has this record
been exceeded and on both of these
occasions 1t was the heavy crop
movement that made the record-in
October last year and october 1870.
The latest record showed that the
major portion consisted of merchan-
disc freight and that the increase
over the previous week, with one
trifling exception, came from all
parts of the country.
Showdown Hasn't Come.
In the face of a showing of this
kind it is difficult to reconcile a
decline of Is points in a dividend
paying stock of a corporation that
is doing more business than 1T mas
done for two years and that mas
improved it's financial position most
decidedly Great stress has been laid
"a sn.rQl1ed slowing down Oh
the building industry, but steel used
in building construction is only or
minor Importance and furtherniore
the showdown has been more talked
about than actual.
In fact, it hasn't occurred. There
has been no abandonment of build
ings actually in course of construc-.
tion-l1erely the postponement OF
protec d buildings and not because
there was no demand for them, but
for the entirely opposite reason that
there was too much demand. SO mucn
that the labor supply was complete
" absorbed so that "snowballing'
was resorted to. That is, one con-
tractor bidding against another FOR
labor until wages were forced TO
therefore, this building demand in
reserve-a poor excuse for knocking
is points off the price of the stock
And in the meantime the final
reports for the month of April as re-
vealed by the interstate commerce
commission show that the Class l
railroads have for the first time in
three years since the roads were re-
turned to their private owners earned
the 5la per cent which the trans
portation act designated Temporal
rily as fair return on the valuation
of the roads and which, If continued,
will show an annual return OF more
than So per cent.
If the railroads can earn money
they are also in a position to spend
it. The New York Central. for ex-
ample, has during the week placed
orders for 10000 tons of steel rails,
distributed among four independent
steel companies. and representing an
expenditure of about $S,5O0,OoU
other roads have also placed large
orlers for rails and locomotives and
will continue to do SO.