Evening star. [volume] (Washington, D.C.) 1854-1972, 1930-11-26
SAYS STOCK RALLY
WAITS ON INDUSTRY
Or. MouIton Tells Bond Club
Market Will Respond to
Better Trade.
BY EDWARD C. STONE.

BY EDWARD C. STONE.
Two vital industries automobile and
eonstruction-are likely to show expan-
sion early in 1891 and prices Of stocks
will rally promptly when industrial pro-
duction does pick up, DR.. Harold G.
Moulton, president of the Bookings In
stitute, as jackson place, declared in
his talk before the Bond Club Of Wash
ington. In concluding his forecast of
the business outlook, DR.. Moulton said:
Stock price movements nave tended
In recent years to follow, rather than
to precede, actual industrial changes.
Owing to the effects of the depression
upon the current earnings of corpora
lions, 1t Is not improbable that stock
prices will remain depressed until such
time IS business improvement Is actual
~ in evidence. If industrial production
picks up in the early months Of next
year, stock prices will promptly rally.
We may. think, expect the remainder
OF the, year to be period OF marking
time, for at the moment in the popular
mind the elements of uncertainty appear
to pretty much offset such hopeful
signs as are discussed in the daily press.
Data on Crops Needed.
"Some Of the data that are required
for q thorough appraisal of the prospects
for the new year are not yet available,
notably those pertaining to the value
Of this years farm crops, as compared
with previous years, and reliable data
- to the inventory situation in industry
generally 1t Is possible, however. to
consider at this time certain factors
which will exert an important influence
over the situation In the first half OF
1881.
'"The data clearly indicate the ire
oh
basic industries, building and automo-
biles, have exerted in the general bust
ness situation during recent years. Ac-
cordin9ly, II we can now gauge the
probable trend IN these industries, we
shall have q reasonably good basis LOT
predicting the general trend OF business
What, then, are the possibilities OF I'M
provement In these basic industries?
with reference to the construction
industry, 1t would seem that the chances
for an increase in activity in the f1rst
half Of 1880 are fairly good. Certain
divisions of the industry, notably houses,
apartments and ONCE buildings are
still overdeveloped, but after year OF
restricted building operations and with
the cost of construction materially re-
duced It would seem that even in these
lines 1891 should show some improve
ment over 1890. OF more Importance,
however, Is the probability that there
win be q substantial expansion Of pub
lie works, the plans for which are being
vigorously pushed by the Government.
We may, therefore, expect the total
volume Of construction to show some
expansion in ensuing months.
Predicts Early 1881 Expansion.
1.-THE automobile industry Is likely
also to show expansion. There can be
no doubt that the output in the first
quarter Of 1891 will greatly exceed the
production in the last quarter Of 1880,
> the final quarter of the year always
being period of seasonal depression.
It Is not so clear that the first quar-
ter's production viii exceed the cor
responding quarter of last year. On
the favorable side, however, it may be
noted that the drastic curtailment OF
output, particularly during the second
half of the current year, has apparently
accomplished something in the way Of
reducing inventories.
while the data are far from salts
factory, trade reports up to September
! indicate q reduction Of cars in the
hands Of dealers to the extent Of 100,-
600. Moreover, large numbers Of car
owners have been making their old
cars do. and at the END of some II or
depression Of November, 1929, the time
would seem to be ripe for some increase
In replacement orders.
"It is of course true that old cars
can be made to last more or less indefl-
n1tely; and yet, on the other hand, 1t
would require only . slight improve
ment in the general situation TO bring
Q decided change in the attitude Of con-
sumers. In any event, current reports
from automobile centers confirm the
impression that the new year will see
genuine improvement In this vitality i'm
portant industry.
The extent TO which improvements
In these fields will affect the entire
business situation, however Is another
story. 1t will depend In considerable
measure upon whether the agricultural
situation shows turn for the better
and also upon the political and eco
nomic stability Of other countries with
whom We have close commercial rela-
tons" DR.. Moulton concluded.
Gas Companies Report Earnings.
Net corporate income Of the Wash
tngton Gas Light Co. in October totaled
&540284l in comparison with $56lo476
In the corresponding month q year ago,
according TO the report Just filed with
the Public Utilities Commission This
Is q decrease Of $2,166.35.
For the first 10 months Of the present
year the company reports net profits
amounting TO $3.50, 1851 10 in comparison
with $7oS, 756. 81 IN the CORRESPONDING
period in 1929. or q drop Of SAL 904 So
This Is considered an excellent showing
considering business conditions in the
period under review
The Georgetown Gas Light Co. re-
ported a falling of in net earnings in
october but for the 10 months net
earnings totaled $l3T ,093.04. against
$ilo,262.50 In the corresponding period
last year. gain Of &l7,SI0.54.
Ice Company's Profits Grow.
Net profit of American Ice Co. and
subsidiaries after interest, but before
Federal taxes and depreciation, for Oc-
tober were 9404,0lS, compared with
$4,000 for october, 1929.
The company's net profit after inter-
est. but before Federal taxes and de-
probation for the 10 months ended
october 81 were 1884, 1925, comparing
with $5,27B,430 for the same period
last year.
Directors OF Chesapeake & Potomac
Telephone Co. at their monthly meet
ing yesterday authorized underground
cable extensions in the west central
once district, additional switchboard
equipment in the Georgia central ONCE
and miscellaneous extensions in other
sections OF the city. The facilities au-
thort1ed, together with other construc-
ton already in progress, bring the total
amount appropriated for extensions in
the District so far this year to s3,367,-
$40, ofaciAls OF the company state.
All the banks and brokerage houses
and the Washington Stock Exchange
viii be closed tomorrow, Thanksgiving.
Traction Stock Sells at 40.
Six 1o-share lots of Capital Trac-