Evening star. [volume] (Washington, D.C.) 1854-1972, 1925-12-31

buying which has sp WEST
brought mill oper-
atoms up to over so per cent OF
capacity will stiffen the price situa-
ton and allow the steel companies a
larger margin Of profit than they
have at present.
Conclusions along this line are more
optimistic than they were, but they
are still cautious. The steel industry
is in very different shape from what
1t was at the beginning Of 1925 and at
other periods where buyers had let
their stocks run down too low. In
stead, demand IS running fairly level
with supply. Railroad buying is on
the increase, but construction buying,
which was altogether abnormal last
year, is on the decline. The steel
producers, as 1t appears now can look
forward to a season of moderately
good earnings but nothing more.
Higher Railroad Dividends Expected.
How the railway situation Is going
to develop with the course Of the
new year Is one Of the interesting
problems confronting Wall Street.
They have made their write offs for
maintenance expenditures following
the period when private control was
resumed. This has been showing in
the net earnings OF recent months
and II has indicated the likelihood
either Of dividend resumption or of
higher dividends where these are now
being paid. The gross traffic as shown
in the monthly statements and IN the
weekly figures of car loadingS have
pointed TO record breaking heights.
Now that these SURPRISES are not to
be expended as they We're from 1920
to 1925 upon repairing the deprecia-
ton under Government control, the
indication IS that there will be higher
dividends. and this is one of the things
which the market IS looking forward
to during 1926.
The year 1925 Will go down In
financial history as a period of rapidly
rising prices on the Stock Exchange
and of an immense business turnover
Second, it will figure as a year when
French finances have become increas
ingly precarious despite reassuring de-
velopmentS In Great Britain, in Ger
many and In Italy. Third, il will
appear as an uncertain time for the
American farmers. Cotton has gone
down as the result of a largely ex-
banded production. Wheat has gone
through d series Of sensational ffuc.
tuations with the net result TO the
growers about the same as 1t was last
year.
The corn crop was nearly % per
cent larger than that OF year ago.
1t was above the five-year average be
ginning with 1920. The decline in
pected. But II has to be remembered
that corn constitutes only 10 per cent
of the farmers cash income. The
| principal factor is the maintenance OF
comparatively high prices for cattle
hogs and other farm animals which
depend upon corn feeding.
Wheat Situation About Same.
The American wheat crop was dowr
some It's, 900 900 bushels from a year
ago There was a similarly heavy
! shrinkage' in the Canadian harvest
| On the other hand, European produc
| ton was generally larger and Europe's
capacity to buy was materially in
| creased. These were balancing forces
! Of sufficient equality TO keep the whea1
| price level about the same as it was
| last year at this time. Present ffuc
! tuations have little meaning because
| the great bulk of the crop in farmers
hands has been disposed of and the
| remainder Is of interest only Il
| spectators. This situation will con
| tinue until q better line can be ob
! tained upon the planting and probable
| output for the 1925 crop and unit
| there is more information than is nov
| available regarding the crops of Other
| exporting countries.
! At the close of 1924 the two MAR
| considerations were the extraordinary
| abundance Of credit and the assurance
of political stability. These remair
the same at the end Of 1925. Bushes:
| interests feel as they did IL month:
! ago, that nothing is going to be done
| at Washington of disturbing nature
They also realize that the bushes:
| expansion during the year along witt
| the huge Wall Street speculation has
| been handled with no great appeal Il
the resources of the Federal Reserve
No Gold Imitation Ahead.
| The general reserve ratio is dowr
| some per cent from the high of the
| year and some per cent from where
| 1t stood a year ago. But around 81
| 1t compares still very favorably with
| the infiationary period of 1919 anC
| 1920. In May of the latter year i,
got down almost to 40 per cent. There
Is to be no gold imitation, which wa:
one Of the favorite subjects of dis
cussion in 1929, for the reason thai
the American capital surplus derived
from the foreign trade and the inter
est from the new foreign loans are
being invested in European enter
prises and seems likely to be for {
! considerable time to come.
| The recovery in sterling to what
was practically pre-war parity was
one of the striking episodes of the
year. The Bank of England did not
| at once declare an. open gold market
| 1t continued to accumulate bullion
! from the end of April when the golc
basis was re-established, to the begin
ming of August. With the gold tota
at the largest in its history the policy
was changed, and since then Great
Britain has been paying out golG