Evening star., 1927-04-22
MEN AND MONEY
By NJ. S. Rukeyser.
fCnnvright. 1921

In the face of widespread cautionary
advices. the average price OF specu-
lative securities continues to mount to
unprecedented peaks.
The two-sided character OF the mar
ket, with each new advance Stoutly re-
sisted, tends to keep the technical po-
sition of the market stronger than it
otherwise would be at this late stage
in the bull cycle.
Unlike in 1925 and 1926, no early
Spring precipitous decline developed.
In previous years the drastic reaction
followed a spell of reckless speculation
lin which the gospel of prosperity
and higher prices appeared to be al
most universally accepted. In recent
weeks. however, although the aver
ages have gone higher, there has been
a quiet readjustment of values. Shares
of companies in relatively weak posi-
ton or of enterprises in unfavored in.
dustries have declined, while the
shares of dominant and prosperous
companies have moved aggressively
forward. Buyers have Disseminated
carefully, rejecting companies that
have shown an inability to improve
their earning power during this period
of heightened competition.
Interest and Rates Decline.
Behind the advance of good stocks
has been the persistent interplay of
forces dependent on continued easy
money. Long term interest rates con-
tinue to decline and the market in
bonds and investment stocks has been
rejecting this adjustment.
From a comparative standpoint, the
altitude of the present price level
should demonstrate even to the casual
observer the unwisdom of entering the
market except on a conservative basis
The recent prosperous years have
thus far yielded richer returns to the
venturesome than to the overcautious.
A Nationwide survey undertaken
by FairChild Publica tions, covering 40
States, tends to show that losses in
Cured through the partial payment
plan by department stores were only
slightly larger than from ordinary
charge accounts. However, most
merchants urged extreme caution in
further extension of the installment
plan.
While the timid debated whether
the time had not arrived when all the
American families who could afford
automobiles had them, the new fash
ion of having more than a car in the
family garage has become widespread.
According to survey by the National
Automobile Chamber of Commerce,
1900, 900 families in the United States
have two cars or more. Perhaps the
time is near when the household which
can boast of only one automobile will
become socially declasse.
The Changing Notions.
1t is many years since the mere
owning of an automobile stamped one
as a patrician, although in the early
days of the industry that was clearly
the case. The changing notions to-
ward the prestige value of an automo-
bile give a clue to the general rise in
living standards in the United States.
The average merchant or manufac-
turer is careless about building up his
bank credit, according to David
Berdon, New York certified public
accountant. He rightly points out that
it is as important to establish bank
credit as merchandise credit among
those from whom goods are purchased.
Here is his formula for the business
man to follow:
"If / were seeking to build up bank
credit, one Of the things / would not
do would be to start negotiating for
additional arrangements with other
banks without taking my original one
into my confidence Neither would /
change banks without reasonable JUS
tification for a change, for grievances
which lead to this action often are
either imaginary or due to mis-
and can be cleared up.
And it must not be lost sight of that
the evidence of stability which is fur
nished by a depositor's record of many
years affiliation with one or more
banks is an enviable credit asset
Building Bank Credit.
'It is advisable for the merchant
not to drain his business by excessive
Withdrawals in the form of salaries or
dividends as the profits increase. II
the concern should be corporation, it