The Washington times., 1929-12-26
MARKET OFFERS
! HOLIDAY
BARGAINS.
BY MERRYLE S. RUKEYSER
Copyright, 1929, by Universal
Service, Inch

observation-disclosures hh@oAAONNSf ~
too would focus attention on
post-holiday bargains.
Public apathy, tax selling,
testing out of vulnerable spots
by short sellers, professional
dislike Of gold exports and
temporary firming up OF money
rates, and skepticisn over the
short term business outlook
have gradually effaced most OF
! the gains registered in the
post-paric rally.
j Accordingly, the C m m Q n
stock purchasing power OF the
dollar has again risen. Left
overs, remnants and even
Stand-patters at the security
posts are available not only
at prices which, fare cheap In
comparison with bull market
peaks, but also in more sensi-
BILE terms of known earnings,
actual assets and probable fu-
tIire prospects.
The ticker reflects the pre-
vailing mood, and the discern
ing, analytical long term in
9eStor has traditionally found
1t safer to make commitments
IN times Of peSSimiSn rather
than on occasions OF overflow
ing public optimism.
Irrespective Of the short term
outlook for common stock
prices, the advice to buy bonds
is Still timely. After the turn
Of the year. seasonal factors
should tend further to ease in-
4 terest rates, and lay the eco
non1ic setting for q further ad-
vance in high-grade bond
prices. High coupon European
government bonds should also
participate in the revivala eS-
pecially if International bank
ers are serious about making
an offer to investors Of repara-
ton bonds.
The public has learned in re-
cent months that even the best
stocks may be uhattraCtive, If
Y priced unWarrantably high.
Having analysed the behavior
of stock prices over an extend
ed period, Karl Karsten, the
New Haven Statistician, has
found, however, that the best
grade of stocks do not sink in
q bear market relatively as far
as the worst grade. The mid
die grade of stocks, he says, are
more sluggish on both the up
and down side than either Of
the extreme classes. He said:
mot all companies within
an industrial group share
alike in the fortunes Of the
industry. In any representa-.
tive CrOSs.gectiOn several stocks
y viii be found which climb faS-
ter than the aggregate during
prosperous periods and sag
less during depressed periods.
Such companies present un-
usual opportunity for invest
| Inent, and could they be con.
tinued in time, our funds
would mount faster than il
4 spread over the aggregate.
The selection Of intrinsicalIy
good stocks, and reliance upon
their intrinsic quality to pro-
duCe IOng.term investment
profit is . high type of modern
investment procedure.
The actual future price
movement Of any one stock,
however. is not due wholly to
qualities Of management, earn
Ing capacity, nor TO strategic
position, Such qualities raise
or lower the stock above or be.
low the level III its cOmpeti.
tors, But the best company in
an industry viii suffer when
the industry Wanes, and in
= many cases purely industrial
conditions will sweep o COM
paratiVeIy poor stock up the
price range in The race or q
bull movement.
8 Obviously, therefore, a good
stock In q prOspering industry
I Is better than q good stock ii
D waning industry. Or, from
another viewpoint, good stock
may be temporarily poor buy,
Il the industry upon which Il
depends be entering upon
! dull period"
immediately after the late
debacle III Wall Street, the
economic sages 1t Harvard
University expressed the view
that nothing worse than
short business recession lay
ahead. But they pointed out
that their opinion was provi-
SsiorlaI. pending the receipt OF
further data. Now, viewing the
situation from q better per-
spective, they forecast q recov-
cry of business next spring,
with further Improvement In
the fall, so that 1880, as a
whole, should prove at least
3 fairly good year"
summarizing the status OF
business, the Harvard Economic
Society," Ia It's current survey,
says:
The figures show that the
business recession already UNI
der way became decidedly
worse after the crash, but did
not 20 to such lengths as to
indicate disaster. The severest
declines occurred in physical
output (nOtabIy OF automobiles
and Of such basic goods as
iron, steel, nOn-ferrOus metals,
textiles, and the Iike) and were
quickly reflected in smaller
$500 -....,....n,.k