San Antonio light. [volume] (San Antonio, Tex.) 1911-1993, 1923-09-23
BOND PRICES |
MOVE TOWARD !
LOWER LEVELS
Speculative Sentiment Pes-]
simistic-Timidity \
Increases. |
LIBERTYS in DEMANDl
Easy Money Brings About
Rise in Government /
Issues.
LIBERTYS in DEMAND
BYRON. SELLER,

New York, Sept. 22.-With specu-
lative sentiment pessimistic and ind
vestors timid and hesitating it was
not surprising that the trend of the
security markets this week should
have been, for. the most part, DOWN
ward. Whether or not this movement
is justified by actual conditions is
more than doubtful.
In a general way there are three
factors which govern markets in a |
condition like the present. These are,
first, the money supply and money!
rates y second, the outlook for BUSH
ness and, third. politics. included in
the latter. conditions both at home
and abroad.
Now as to money. quotations have
been moving toward lower figures. On
the first two days of the week over
the-year funds commanded "a per
cent and were in not in free supply
at that. This was an advance over
the prevailing rate for the past two
months. The mid-week, however, saw
sharp break and on Friday short
dated loans were made at IA per
cent while the longer maturities COM
manded 5 IL.
Jail MOHey DOWu.
At about the same time call money
went down to the lowest since the
middle of January. Brokers protested
surprise at this development although
it was amply justified by the federal
reserve mid-week statements. This
showed that the reserve ratio of the
system was up to the highest of the
month and with the autumn require
ments mostly cared for only one per
cent below the highest of the year.
With a definite easing in money
rates the logical result would be an
advance in high grade securities.
There has been no such rise, however,
except in the United States govern
ment bonds. Libertys turned defin-
itely strong late in the week and
while traders had the ready explana-
ton of Buying by the treasury for ac-
count of the sinking fund it is j1A
as plausible to say the movement was
in response to the turn in the money
market. -'' -" e'yss
Demand For Liberty Bonds.
The failure of the high grade rail
road and industrial obligations to fol-
low the government bonds may be
due to the present preference of in
dividual investors for safety without
regard to yield. Bond statesmen COM
plain that their customers prefer
Liberty bonds to everything else.
Probably this is the psychological eff
feet of the decline in speculative
securities, a decline which must be
arrested before cautious investors
will accumulate anything but the
most unquestionable holdings.
The second factor of Importance is
the outlook for business and here the
situation is more involved. Up To-
this week the most stress has been
placed upon the production in the
oil trade. Just now it is the steel
industry that is attracting attention.
There are more discouraging features
about the steel outlook. Consumers
appear to have pretty well anticipated
their requirements for some time and
some falling off in buying and pos
sibly some weakening in prices would
not be surprising. But when per-
centage figures as to steel operations
are quoted, it should be remembered
that capacity has been enormously
enlarged. The output would look
much larger on a pre-war basis.
Motor Shares Drop.
Wall street analysts are full of
gloom about the automobile business.
They find it easy to see over-produc1
ton and disastrous competition. They
are also alarmed over so much buy1
ing of automobiles by people who
alarmists say, cannot afford such a
luxury" Automobile stocks -
been heavily sold all the week ID
spectators impressed with this sort
of reasoning. Meanwhile the leading
automobile companies are in thd
strongest position financially.
Coming to the third factor, politics
there is certainly nothing of dis
couraging nature anywhere on the
horizon. On the other side Framed
and England appear to have made
distinct progress toward a working
agreement and Germany gives every
indication of anxiety to make terms
with France. The one strong grnuu
IN the bond market, aside from Lib
ertys. has been French government
obligations.
Rail Stocks Strengthen.
At home it is the railroads which
are subject to political influence
There is still uncertainty as to VIVA
congress VIII 90 with regard TO the
transportation law. Here too, how
ever, there are encouraging signs
Confidence is expressed that Presi
dent Coolidge will insist on the rail
roads receiving fair treatment and
has been evident all week that rail
road stocks and railroad speculative
bonds have been bought and sold OF
their merits represented by earning
power more than with the correspond
ing industrials.
In the commodity markets. the mos
interesting happening has been thu
rise in sugar prices. Coming at th
same time, as the resumption o.
dividends by a prominent sugar pro
ducing company, it has served t,
temper the assurance of those who
see nothing but lower quotations FOL
commodities and securities alike
Sugar and cotton have shown thei
ability to move independently.
incidentally business conditions ar
not the uniform the country over. III
South seems TO be in n more favor
able position relatively than other SEQ
tiona