Evening star. [volume] (Washington, D.C.) 1854-1972, 1928-07-01
RECORD-BREAKING SIX MONTHS
SEVERELY TAXES BIG EXCHANGE
Broadcast Dealings in History Sees $780,
000-Share Day and Tremendously
Overloaded Mechanical Facilities.

rise went, because no one Is In a posi-
ton to predict the possibilities. ALI Et.at
Is sure Is that the future was discounted
long time ahead.
When We come TO the rest of the mar
ket 1t was more discriminating than II
appeared to be. Stocks of industries
and Of groups Of industries in an un-
favorable position did not participate in
the advance, Instances are the sugars
and the oils. The latter improved to-
ward the end of the half year, but that
was In response to an improvement In
the trade. The copper stocks were long
neglected, to be taken up only when the
market for the metal began to turn.
The same can be said for the fertilizer
shares.
Of the stocks which were made the
leaders in the rise there was justifca-
ton in the case of the electric light and
power companies and the motor car
companies. The public utilities. leaving
out the fractions, have been reporting
continuous increases in earnings. The
prosperity Of the automobile trade is the
wonder of the bushes world. It would
have been surprising if there had not
been a corresponding rise in the stocks
involved
With regard to the rails. the situa-
ton is somewhat different The first
half of 1928 made a poor comparison
with the preceding year as far as rail-
road earnings were concerned. On the
other hand there was never, in the
dividend-paying shares at least, any
such extreme speculation as there was
in the industrials. and the market price
of the railroad stocks was much lower
on an earnings per share basis than
that OF the industrials. Moreover, the
income of the carriers Is always more
stable than that of industrial nrgani-
cations. So it is possible to MAKE good
defense for the railroad stock market.
Rise Carried Too Far.
Actually the stock market did pay at
tention to values, to earning prospects
and to the business outlook. What,
then, is the criticism? 1t is that the
rise was carried too far, that it dis
counted and overdiscounted everything
favorable.
All of this has a bearing on the f1-
ture. There is no major bear market
in sight. There must be a readjust-
ment. The amount of credit abSorved
in speculation is disproportionate 1t
will have to be cut down. The Specu-
lative fever will have to be allayed.
Once this is done and the money situa-
ton becomes relatively easy again. the
stock market equilibrium will be re-
stored. When that time will come can
not be accurately stated. AS was said
above, decline once it sets in. always
goes too far. Nevertheless. those who
hold stocks representing equities in es-
sential industries. competently man
aged, need not be seriously concerned.
providing these stocks are fully paid
for and not carried on slender margins
So far nothing has been said about
the political phase of the situation. The
writer can only express an opinion,
which is that politics do not figure to
the extent that Is commonly supposed
At this writing there Is no indication
of serious radical movement, no mat
ter who is elected President There
may be some hesitation In the market
as the uncertainties of the election de-
yelop. but there ought not to be any
serious disturbance