Evening star. [volume] (Washington, D.C.) 1854-1972, 1930-06-29
STOCKS SUBJECTED
! TO HEAVY SELLING
IN WEEKS TRADING
Many Issues Approach Low
Levels of November and
Some Decline Further.
REACTION DURING MONTH
HAS DEPRESSED TRADE
Wavering Character of Market
1mpairs Confidence in
Financial Circles.
BY CHARLES F. sPEARE.

Special Dispatch to The Star.
NEW YORK, June 2s.-This has
been another trying week for those who
| own securities, for the business man
who makes his commitments on the
basis of commodity prices and for the
institutional group whose chief profits
are derived from the lending of money.
Stocks have several times recently
approach the low average of last No
vmber and then have moved away from
| this danger point, though individual
shares in considerable numbers have
gone through it. Leading commodities
have declined still further and to a
level where production costs are well
| above marketing values Call money
rates, rates for long-term loans and
bankers bills are available to the Dor
rover on the easiest terms in many
| years.
| The rate on deposits in the New York
| clearing house banks has been reduced
to figure that ought to shift capital
| from them into the investment market.
| The fact that this has not occurred on
scale sufficient to steady bonds,
| which are back to about the low aver
| age of last January, is one of the mys-
! tifying elements in the present be-
wildering situation.
Bears in the Saddle.
Unquestionably the reaction in
stocks this month has had the effect of
making poor business condition worse
Except for the ordinary seasonal i'm
provement trade is relatively slower
than 1t was six weeks ago. The shrink
| age in the quoted values of securities
has caused considerable amount OF
cancellation of orders and has intensi-
| fed the spirit of peSsimism in the bust
ness and financial world. The country
today is in bearish mood. It is dis
tinctly timid and hesitates to make
commitments, even though it admits
that securities are below their intrinsic
values and commodities at prices that
would yield good profits when later
worked up into manufactured goods
On lesser scale than in 1921 buyers
are on a strike. The fact that there
Is such wide margin between retail
prices and wholesale prices, with the
one group adjusting itself slowly to the
decline in the other, accounts for some
| part of this. Where there is an in.
| crease over last year in the volume Of
| retail transactions, 1t appears to be ir
articles of a moderate average price
| This tends to Offset the decrease il
demand for more expensive items.
| Banks Position Strong.
The saving health in the situation
Is the liquid position of the banks ano
OF stock exchange houses, along with
great ease in money and the apparent
ability of people with reduced incomes
to go along without much change ir
their habits, owing to the reserves ir
the form of securities, bank deposits OF
life insurance which they have set ur
in the past 10 years.
| Practically all of the important bank.
ing failures throughout the country
since last November have been due tC
some form of dishonesty by employees OF
ofiicials, or were a sequel to the rea
estate imitation in Florida. The small
number Of stock exchange suspensions
attests to the reserve strength of the
| membership that has witnessed the
most violent shrinkage in values in any
ntne-month period on record. Here
1 again such troubles as have arisen have
been caused by inside speculations more
than by the fall in prices.
| Copyright, fs3o)