The Washington times. [volume] (Washington [D.C.]) 1902-1939, 1925-11-11

Bankers Association journal
Names Factors Making
For Declines
By RICHARD HATTON

By RICHARD HATTON
In its monthly review of business
conditions the American Bankers
Association Journal finds that the
stock market in October "as a
whole had risen some twenty points
since midsummer, and nearly fifty
seven points or rs per cent, since
the end of October, 1923, when the
bull market began" The Journal
points out that. "fact> rs frequently
mentioned as fespons!' lie for the
renewed advances included the un.
usually favorable second and third
quarter earning reports. the pos
sibility of further reductions in
federal tax rates and the treaty
signed at Locarno." ..
"There has been growing dis
position, however" says the JOURNAL
ON the part Of financial observers
to regard the renewed advances as
marking the final. stages Of the
bull market which has been in pro-
gress for two years. Market let
tiers Of a majority of the large
banks and responsible brokerage
houses have been advising custom.
ers OF the approach of what seems
to them to be the turning point in
the movement of stock prices.
Intimating the possibility Of an
end to the bull market the journal
says: 1.-THE continued rise in stock
prices and their inverse reduction
In yield, taken in conjunction with
the increased cost of stock brokers'
loans, has greatly reduced the adj
vantage of carrying stocks on bor-
rowed money. If this advantage
should disappear altogether, a situa-
ton would exist which in the past
has normally led to liquidation Of
accounts and declining stock
prices.
Commenting upon the effect Of
gold imports and their rela tons to
Federal Reserve Banks recent
bulletin issued by the Federal Re-
serve Board says that gold imports
during October came at a time when
member banks had a considerable
volume of accommodation at the
reserve banks and also at the sea-
son of the year when there is a
growth n the demand for currency.
The bulletin continues:
The receipt Of gold from England
at this time of the year is in ac-
cordance with the usual course of
events prior to the establishment of
the Federal Reserve System, when
agricultural exports to England in
the autumn months, together with
the demand IN this country foe gold
to meet seasonal currency \require
ments resulted in pressure 6n sterl-
ing exchange and in consequent gold
imports. Since the establishment of
the Federal Reserve system there
has not been a time until this
autumn when the effects of the
systems operation upon the rela-
tionships between the New York and
London markets could be fully OBJ
served.
THE ability of reserve banks 10
meet seasonal demands currency to-
gether with the growth of foreign
trade financing in this country, par
ficularly through the use of the ac-
ceptance has diminished the pres
sure on sterling exchange at the
time when American crops are mar
keted." In this situation, the bulle-
tin continues: Thus, the gold i'm
ports to this country during October
Of this year represent primarily a
further phase in the adjustment be-
tween the two principal money
markets to the restoration of free
gold movements"
ing made for the midwtnter confer
ence and banquet of the trust COM
panies of the United States, con-
Quoted under the auspices Of the
trust company division of the Amer
lean Bankers Association, which will
be held in New York next February.
The Importance of these gatherings
and the advantages of the discus.
sions held are so great that the
dates are announced well in advance
In order that trust company officials
may arrange their business in suCn
a way as to leave the banquet date
open.
President Francis G. Addison, of
the District of Columbia Bankers
Association. returned today from
hunting trip in Prince Georges
county.
President Robert V Fleming and
Vice President George o.. Vass, of
the Riggs National Bank, have
been the recipients of an almost
overwhelming flood of congratula
tory messages and calls. The lobby
Of the bank has been transformed
into a great bower of flowers sent
by friends and admirers of the
newly elected officers since the
announcement of their elevation.
Vice President Thomas p. Hick-
man, of the Franklin National
Bank, who has been in Florida for
the past week on business and
pleasure, is expected TO return to
S. Washington within a few days.
President George White, of the
Observation-Disclosures. .....---------