Alexandria gazette. [volume] (Alexandria, D.C.) 1834-1974, 1923-03-14
Business Grows
Satisfactorily
Advance of Commodity
Prices Cheers Investors
Trade is Better

market during the past week
while At the same time the devel
iopment of business conditions
has proceeded very satisfactorily
with the result that there is now
probably a larger volume of or
ders en- the books of manufac
turers. according to current est
mates, than at any time in the
past. Figu!Cs compiled shov
that the volume of business is flu
" up to The level of 1920, an(
that probably a peak has beer
reached which is not likely to be
very much exceeded in the neal
future.
That being the case, the influ'
/ eace Of volume Of business upon
the stock market is not likely tC
be greatly increased in the mean
future, but the chief facor of sig
nificance will probably be found
i'm the earnings changes. Figures
compiled for 1922 concerns which
have made their statements pub
lie thus far this year show that
their entire earnings in 1872
were $685., 100000 as againht a to
tai earning of $136,O0O,O00 in the
PRECEDING year. At present
rates the earnings of 1928 are
likely to go far ahead of those OF
last year. with the result that in
creased dividends can be, and, in
many cases probably will be, paid
These earnings are at present
the most significant element in
the Establishment of values on a
new basis, and the exceptionally
good showing that is being made
by The railroads during the first
weeks of the current year is con
vincing that not only the indus
trials. but also the rails, have the
elmnts of gnuine buoyancy re-
suling from demonstrated earn
ing power. A January rate of
fully $50 per cent is now shown
by Class / roads. Improvement is
showing itself not only in these
main groups of stocks but also in
the minor claSsifications, such as
public utilities and others.
The advance of commodity
prices has been a notable fea-
ture Of recent business and is
regarded as reason
for the adoption of optimistic
opinions with regard TO stock val
ueS. A. to this, however, two
opinions are evidently entertain
ed. The Federal Reserve Bank
Of Boston has lately issued a
warning against over-rapid in
crease of prices, backing its opin-
ons on the ground that such adj
vance will compel a check to the
of credit, due to the
tact that with production al top
level, price advances are not
needed to bring about business
and should therefore he
avoided where possible. The Fed
aral Reserve Board has also is
sued a cautionary statement With
regard to price advances and pos
sible further increase in discount
rates. it's position clearly being
that overrapd increase in prices
may neceSsitate greater discount
advances than would otherwise
occur. There is no new indica-
ton that these warnings have
been very seriously needed thus
far, higher prices being establish
cd for cotton. copper, sugar, wocl
and many other basic materials,
as we'll as for manufactured arti-
cles as result of strong demand
and a feeling on the part of pro-
ducerS that high costs of manu-
facture have long since made it
essential to raise charges as soon
as they could safely do so without
consumption.
Some important factors in the
situation likely to affect stock
market movements which have
not been fully allowed for, have
been left behind by Congress, or
are likely to grow out of admin
iStrative undertakings. The
Tariff Commission is about to be
gin series of hearings with res
pect of rates of duty, which may
have some reflex effect upon val
ues both of commodities and of
stocks. Hearings before the In
terState Commerce Commission
relative TO the proposed merger
or combination of rail lines in
the eastern territory, as provided
for under the transportation act,
WI shortly opGn. The passage
by Congress of the new rural
credits act neceSsitates the forma
ton Of So-called agricultural cor
porations, or the recapitalization
aud reorganization of land banks
BY the Government. 1t is expect
ed that agricultural corporations
will be formed by subscriptions
furnished by banks and invest
meut institutions in the principal
ceterS AZ no very distant date.
and it is possible that this may
result in foreStalling action on
the part of the Government lock
ing to the creation of new depart