Evening star. [volume] (Washington, D.C.) 1854-1972, 1925-01-10
CLIMB
WEEKS BIG EVENT
Approach to Par Due to
Greatly Improved Condi-
tons in England.
By STUART p. WEST.

SpeclhI DlSpatch TO Inc star.
NEW YORK, January 1o.-The Sec
ond week of the new year has been
pretty much like the first. with the
exception that the Wall street specu-
lation has been less violent. Money
rates have come down as they nor
mally do with the return to the re-
serve centers of funds which were at
work in the Autumn crop moving.
Sterling Approaches Par.
The advance in sterling exchange
to the highest since 1915 has been an
outstanding feature. 1t has fitted in
with the best opinion, held for long
time past that the essential require
ments had been fulfilled for the Brit
fsh pound to return TO par. In the
first place the English budget was
successfully balanced. SO much so that
II was practicable to reduce the in
come tax.
Secondly, the British foreign trade
had got into a position where the
surplus Of merchandise imports had
ceased to run ahead of the so called
Invisible credits, meaning by this the
income due from foreign securities,
from ocean freight charges, from
tourist expenditures, and from the
sale in America Of new European
loans.
Finally, regular semi-annual pay
ments on interest and sinking fund
had been assumed on the $4,000, 900, 900
debt owed the United States on ac-
count of war borrowings. The change
in government and the uncertainty of
what would happen under a Labor
ministry held up for eight months
the natural operation OF these eco
nomic factors.
Many European Offerings.
Our market, TO be sure, has not
been unfamiliar during the last few
years with this sort of thing. But
it looks now as if Am erican investors
are going to be asked to absorb in
large way the offerings OF European
corporations. of which, so far, they
have had comparatively little taste.
The recent loans for account of the
German industrialists have been es-
pecially significant. With the Dawes
plan in effect, with European curren-
cies stabilized for the first time since
the war, and with economic recovery
proceeding slowly but surely, there
Is an invitation for American capital
to accept the high bids offered from
the other side. not in preference to,
but in competition with, the low bids
offered over here.
haFAct SOuhtS oA "He0s h'A,'
The data relating to business con-
ditiou continue generally favorable.
With the exception of the wage-cut-
ting in the New England textile mills
there has been nothing to mar the pic
ture Of gradually expanding prosperity,
originating chiefly in the astonishing
change for the better during the last
hree-quarters of a year in the situa-
ton in the agricultural States. Pro-
duct!on is increasing and commodity
prices are going up. The indications
are that the first three months of 1875
will be a profitable period i'll most
lines OF industry and the same holds
good for the outlook during the second
quarter.
Against this is the tremendous rise
which has occurred in little more than
two months on the stock exchange.
Has this movement got too far ahead
of the trade situation? From all past
| experience 1t would seem that II has
| been excessive. At all events this
statement may reasonably be made
| that the business good times so free
| predicted for the new year, viii. have
| 10 be unusual in order to justify the
rise which has occurred on the stock
exchange since election day.
! Copyright, 1sc5)