San Antonio light. [volume] (San Antonio, Tex.) 1911-1993, 1923-08-26
WALL STREET
IS SUSPICIOUS
OF PROSPERITY.
"Cycle Theorists" Think
Depression Ought
10 Come.
NOW DULL SEASON
Wait for Fall Trade De-
mands to See What Fu-
ture Holds. |
NOW DULL SEASON
BY BYRON SELLER.

AVG" Aoih, mug. <C.-Iu TIC Wcch .
trend of the investment and specula-
tive markets there has been little to
throw light on the immediate business
future. The speculation has been en-
tirely professional and investment
dealings have. been on too small scale
TO be of significance. This is the nat
ural state of affairs for the season.
1t is significant, however, that q
more cheerful feeling prevails. This aD-
pears in the resistance which specula-
tive securities show to unfavorable
news developments and in the ready
absorption of such few new invest.
ment offerings as have appeared. At
the same time there is too much uncer-
tainty for an aggressive movement in
either direction. Nor is it likely that
the situation will be cleared up until
the outlook for domestic trade in tie
fall becomes plain.
The fact is that great many bust
ness men as well as investors and
spectators have become converted to
the so-called "cycle theory" according
to which there is a more or less steady
progression from prosperity to de-
preston and back again. The result
is that the present generally favorable
condition is looked upon with sus-
picion rather than complacence. In this
state Of mind it will take something
pretty definite permanently 10 turn
the markets.
Coal Trouble Threatens.
The unfavOrable features of the
situation has been repeatedly dis
cussed. These are the low prices of
some agricultural products, low in
comparison to the general price level
and the failure to reach any solution
OF the reparations problem abroad.
To these has been added concern over
the effect of possible suspension OF
work in the anthracite coal region. A
hard coal famine would bear heavily
upon householders in New England
and the North Atlantic coast states.
but would not necessarily hamper gen.
eral business which is dependent more
upon the supply of bituminous. The
hard coal operators and the railroads.
the chief traffic of which is in hard
coal would. of course. he hard hit.
but the public utilities and manufac-
turing generally would go on about ms
usual. \ sympathetic walleout on the
p'%A' VI INV eoil 'bsli Illl4.fES NOtllu lie
much more serious. but this is not con-
sidered probable Mt this writing. So Il
comes back again to general trade
conditions and usual indicia. but bank
clearlngs. car loadings and steel and
iron production are being closely
watched.
AS far as wheat is concerned what
ever may be the temporary course rf
the market, 10 product permanently
sells below the cost of production.
While in the normal order of things i.
takes a year for readjustmcnt of pro-
duction TO consumption in the case of
farm product speculation may be
trusted to anticipate such rcadiust.
ment. And while the control over
grain trading exercised under the new
law has been blamed for great many
things it is highly improbable that this
control will be used to hamper any
rise in the price of wheat no matter
what the course of the buying that
advances the quotations. The situa-
! ton abroad may be dismissed with the
| obervation that the more prolonged
! the deadlock the more impossible it is
to believe that n way out will not be
| found.
Gold Surplus Increases.
The week has been marked by n
| spectacular demonstration in the
stocks and bonds of the Erie railroad
which was all the more noteworthy
because of the lack of confidence in
railroad securities generally. Even
those Wall street professional adyis-
ers who have been urging for the last
| half year the purchase of railroad
stocks because of record carloadings
and excellent earnings statements have
| begun to waver. The advance in Erie
securities therefore was n phenomenon
| for which there was no ready ex-
lanatlon. 1t came. moreover, in the
face of threatened coal strike which
IT 1t materialized. was sure to cut
Eries profits. Other roads also have
made remarkable progress in recent
! months. but there has been no specula-
tive activity in their obligations. The
! suggestion that some new interest was
endeavoring TO gain control hardly ac
counts for the strength in the Fries
better bonds which in its way was
ms pronounced as the rise in the stock
Lacking any other. however. this
theory Of buying from n special source
was the best available.
For the balance of the year railroad
shares will be under the conflicting
influence of the peak traffic which
comes in the fall with the correspond
ing increase in gross earnings and the
doubt as TO the effect of wage in
creases and rate reductions which will
be demanded. the one on the behalf OF
the railroad brotherhoods and tbs
other OH behalf of the agricultural
shippers. There will also be uncer
tainty as TO what the new congress
will do with the present railroad law
On the face it looks rs though tn;
unfavorable factors outweighed tn,
favorable. 1t must not be overlooked
however. that good deal of the trou
bles to which the railroads have falleI
heir. may have been discounted in the
present price of their securities.
Any review Of the financial situa
ton and of the securities market:
would be incomplete without somt
reference TO the gold movement. Dur
ing the month of July gold export
: were 500. S26. the lowest since March
! 1921. Imports were S27929.444
The latter were exceeded this year IL
January and in May, but the excess