Evening star. [volume] (Washington, D.C.) 1854-1972, 1930-03-16
STOCKS END WEEK
LOWER, FOLLOWING
HEAVY LIQUIDATION
Easier Credit Fails to Slim
uIate Demand for Lead
ing Equities.
Squirt IN OIL SHARES
is FEATURE OF TRADING
Intervals of Moderate Activity and
Strength Relieve Down
ward Trend.
BY CHARLES F. sPEARE.

BY CHARLES F. SPEARE.
Special Dispatch to The Star.
NEW YORK, March l5.-The stock
market lost ground on the week. There
were intervals of moderate strength
and an attempt to bid up certain
groups, most notably the oils, but the
market as a whole was reactionary.
AS a market factor, the cut in the
rediscount rate of the New York Fed
eral Reserve Bank from to 312 per
cent fell fiat. AS a matter of fact, the
reduction had been expected ever since
the Bank of England took similar action
last week It was only recognition OF
the situation in the open money mar
ket, where this week there have been
three successive cuts in the rates on
bankers acceptances.
Rejecting the situation, call money
loaned this week on renewal at the
lowest in two years and on new loans
at the lowest in almost four years. But
the only market that has been stin1u-
lated by easy money has been that for
bonds, where there has been aggressive
buying Of both the high-grade and the
semi-speculative issues.
Trade Situation UnfavOrable.
In the stock market traders have
been balancing easy money against de-
clining commodity prices and unsatiS-
factory trade conditions, with the re-
suit that the second factor has proved
the more potent. When the bull mar
ket started some years ago, 1t was
founded on easy money, but the situa-
ton today Is no parallel to that existing
then. In part the abundance of credit
Is due to the policy of the Federal Re
serve, and in part it is due to a lack
Of demand from business.
Meanwhile, the persistent fall In ag-
ricultural prices has been worrying
Wall Street. Several times during the
past week reaction in the stock market
has conceded with breaks in wheat or
in cotton. Toward the close of the
week the coppers were attacked on the
theory that producers could not hold up
the price of that metal when all other
prices were headed downward.
Taking everything into consideration,
the reactionary trend is not surprising.
The notable thing Is that stocks have
held as well as they have, and the only
reasonable explanation Is the insiStent
demand for equities, which those who
have money to invest in securities con-
tinue to make. The strength in bonds
has come not 50 much from purchases
by investors as from anticipation Of
such purchases by dealers who have
been stocking up" In any event the
better quotations for bonds have not
been the result of any change of heart
on the part OF individual buyers.
Oil Profits Hold Up.
There Is little to say about the move.
merlts of stocks in detail. Perhaps the
most significant development was In the
rise in the oils. The basis for the i'm
provement has been the 1929 annual
reports, practically all Of which have
revealed profits as high II not higher
than in the preceding IL months, and
was supposed to be suffering from ex-
IRENE depression. Oil stocks In their
market price capitalize earnings at a
lower rate than any other group of in
dustrialS; they have been and still are
in strong hands and it takes only a
relatively small amount of buying to
put prices up. Whether this move in
the oils will fade away remains to be
seen.
Any discussion of the future of the
market, however, always comes back to
the question Of to what extent, If at
all, the popularity of common stocks
has suffered from the great collapse in
october and November Of last year.
Basic Conditions Unchanged.
It is generally admitted that the 1929
panic, in its violence and In the shrink
age In market values, far exceeded that
of other years. 1t was unlike previous
panics, however, in that it did not grow
out Of banking or commercial troubles;
nor was it the result of radical changes
in economic conditions such as those
which led to great waves of speculation
when the method Of transportation
changed from canals to steam railroads
In the early part of the twentieth CEN
fury. 1t might have been supposed that
with all of the new science and mech
anism Of the age there would be a
scrapping of old devices and, with it,
an obsoleScence that would affect large
bodies of securities. This has not taken
place so far.
(Copyright, 1s3o.)