Evening star. [volume] (Washington, D.C.) 1854-1972, 1930-04-13
RECOVERY IN TRADE
MAY Be POSTPONED
UNTIL EARLY FALL
Cautious Attitude of Mer-
chants Held Cause for De-
lay in Improvement.
GAINS IN STOCK PRICES
ARE PULLING FACTOR
Bankers Declared Well Satisfied
With Present Condition
of Credit.
BY CHARLES F. SPEARE.
,cial Dispatch to The Star.

Nk14SAGO, April 1Z.-1le conclusion
that an observer reaches after making
a coast-to-coast survey of the business
situation is that the period of pro-
bounced and prolonged recovery so free
ly predicted few months ago is likely
to be postponed until the late Summer
or early Autumn.
Conditions nearly everywhere are
better than during the Winter. The
turning point in the decline came on
March !. However, subsequent gains
in those lines that had the best prom
ises, as well as in others that had
hattened out, have been disappointing
There. is a conspicuous inertia in
most of the large cities, with retail sales
well below normal for this season and
with wholesale mercantile operations
reduced both by the conditions in indus
trial employment and in the agricul-
tural districts and by continuing state
OF mind with the public at large that
makes for cautious and discriminating
buying.
Bankers Exhibit Confidence.
Bankers that one meets are more con-
fident than merchants. They see a state
of credit that eliminates any serious
db IIlUSc IlOtOEIOuSly
troublesome in previous eraS of depreS-
sion. The banks in this Federal Reserve
district are rediscounting on smaller
scale than at this season in over a
decade. Effects of declining rediscount
rates are gradually seeping into the
business world, but of money, like many
other commodities, there is too large
a supply to permit satisfactory return
on it.
Between San Francisco and Chicago
one encounters the conditions caused
by low prices of metals, as in Utah and
Colorado, with similar influences over
tapping these States from Montana
and Idaho, while in the prarie country
the situation grows out of the unsolv-
able problems of the farmers. After
finding it everywhere from New Orleans
to San Francisco, one discovers in Iowa
and Nebraska the universal complaint
that farm lands are unstable and city
property lacks buyers.
It is not too much to say that the
sorest spot in the average American
community today Is in its real estate
conditions. This as much as any other
one factor makes the people feel poor
and inhibits the lending powers OF the
bank.
Naturally, the interior of the country,
more than the Pacific Coast, which Is
temperamentally optimistic. cannot I'M
derstand the point of Wall street in
steadily bidding up the prices of indus
trial and public utility stocks in the face
of discouraging business prospects and
some retrogression in lines that pointed
upward a month ago. If the banking
attitude in New York on the market
is one of confidence, in Chicago it is
one of caution bordering on apprehen-
sion.
No one worries a great deal even if
such shares as American Telephone,
U. S. Steel, General Electric or West
inghouse Electric seem to be again over
discounting profits or impending financ-
ing but conservative people have mis-
giv1ngs when they see other unseasoned
or green" issues duplicating the per-
formances of last August and Septem-
Der and know that their market Spon-
soring is none too strong.
The contrary movements the past two
weeks In stocks and in bonds, both old
and new, reaffirm the belief that the
public at large is still enamored of the
one, in spite of being Tilted so abruptly
last Autumn, and is still quite cool to-
ward the other.
Railroad Changes Marked.
Coming the other day across the
Lucin CUTOFF, that remarkable piece OF
railroad. engineering by which E. H
Hartman spanned Great Salt Lake In
stead of going around it, one thought OF
the days Of adventure and romance In
steam transportation and how they
have given way to the rather dull grind
of producing larger trainloadS, more car
miles per day and more engine miles
per unit of fuel. Except for the mileage
built in Florida in 1925-27 by S. Davies
Warfield, who was as enthusiastic over
that part of the country as James j
Hill had been over the Northwest or
B. F.. Yoakum over the Southwest, no
important additions to American rail-
road systems have been made for nearly
20 years.
Obviously the necessity for lines that
reach out and into new territory has
been leSsened by the overbuilding in
the. first 10 years of this century and
transportation effected by the motor
truck and motor bus. It Is interesting
to trace the history of some Of the out
standing projects that figured in what
may be regarded as the final era of
adventure In railroad building in the
United States.
New Elements I'm Transportation.
When one looks back over the record
of major railroad building projects in
the past 20 or IS years, he finds that
nearly all came to grief before they
we're finally stabilized. This leads to
the conviction that the Interstate Com
merce Commission acted with wis
dom, though possibly with prejudice,
when it denied Mr.. Loree the right to
build his cherished Pittsburgh line.
If adventure and romance have gone
from the railroad industry, the ele-
ments of wise and capable administra-
ton and OF a successful fight against
competition from the outside have taken
their place. Railroad gross earnings
seem to have reached point where
for sometime there will be little annual
gain compared with the increase of
nearly 100 per cent. That came with
each 10-year period before the war.
The railroad mans job today Is to
refine his operations and to keep his
transportation cost low. This refine
ment may also have been carried as lar
as practicable, as there is little pros
pect of a broad program OF railroad
consolidation except in the East. GER
tainly there has developed no evidence
of demand for it in those sections OF
the country through which this writer
has been. travelling the past month.
The speculative quality OF railroad
common stocks steadily Is disappearing.
Icopxl1Kht, 1s3ol