Evening star. [volume] (Washington, D.C.) 1854-1972, 1931-07-13
GERMAN SITUATION
AFFECTS MARKETS.
Extension of Credit to Cen
trail Powers Held Vital
to World Trade.
BY CHARLES w. STORM.
Editor the News Service Of Wall Street.

Editor the News Service OF wan street,
Special Dispatch TO The Star.
NEW YORK, July 13.--While i'm
portant people in the financial district
believe that the Hoover debt plan
marked the beginning of return of
improved economic conditions through
out the world, and that the stock mar
ket is in a major upward trend, price
changes will continue to be innuenceo
this week by news received from ABROAD
with regard to the negotiations 1or
German credit of 0OOO0 600.
Although the declaration of the war
debt holiday is considered an important
step looking to the rejuven9tlon OF
world wide economic conditions, II
would have little favorable influence,
according to bankers, without addltlonal
help in the form of credits. The war
oeht moratorium prevented bankruptcy
for the German government, put IL is
equally vital that additional funds be
supplied the Germans to bring ABOUT
Improvement in the German credit Sit
uation.
Other Steps Planned.
Bankers familiar with the plans en-
tertained at Washington with regard 10
the rehabilitation of world finance and
trade declare that it is planned 10 prlhg
about a restoration OF commodity prices
throughout the world This Is also
vital necessity for the betterment OF
economic conditions.
Overproduction is the basis Tor tne
low prices for commodities 1t is,
therefore. planned by the important
movers to hold conferences and devise
ways and means for inducing the tarm-
ers of the world to curtail production.
This. it is declared. will be difficult
task, but American bankers feel conf
dent that if the whole world decides
on pro rata output it Will be accom-
plished.
Restoration of commodity prices, it
Is contended. is vital to the induce
ment of trade agreements with the
Soviet government which is now de-
clared to be in a receptive mood. There
is every promise that news with regard
TO developments in Russia Will also De
a factor in influencing the rise or IAN
OF stock prices.
THE important bankers of the world
believe that the declaration OF mora
torium on expenditures for armaments
would result in materially aiding IN
the restora ton of economic conditions
on sound basis.
An Accumulative Market.
While the stock market mas peen
backing and filling according TO the
character of the news received from
abroad. important interests have been
accommodating good stocks This is in
dicated by the narrow price range OF
fluctuations last week. Those accum-
Mating stocks buy them on recesslons.
preventing acute weakness, put WIN
draw from the market as buyers When
the stocks begin to show improvement.
Withdrawal of the buying power nat
urally prevents any rapid advance.
Accumulation is going on IN NUM-
Der of standard railroad shares and
those desiring these securities nave
gone so far as to approach large hold
ers and offer prices above the market
for pood-sized blocks of securities.
TRANSPORTATION shares are expected 10
show increased activity and strength
this week owing to the beginning OF
hearings by the Interstate Commerce
Commission on the application made by
the common carriers for 10 per cent
increase in freight rates.
Reports have been received from time
to time in the street that the commits
sion would give advances ranging from
TO to 10 per cent. The banking ira
ternity however believes that the COM
mission will be inclined to view the APP
plication with favor owing to reallza-
ton of the Importance OF FOSTERING up
the credit of the railroads.
Some large blocks of railroad stocks
have been taken privately from Euro
peans and the big banking houses are
DESTROYS of marketing these securities.
Fer that reason greater activity is eX-
pected to be injected into the market
for the transportation stocks in the
near future.
Poor Copper Outlook.
Much has been said about the prob
able entrance of the foreigners into
the market for copper metal following
the granting of credits abroad. This
opinion however. is not shared by i'm
portant people in the copper industry.
On the contrary, the copper trade Is
discouraged owing to the inability to
bring about further curtailment CT pro-
duction. Domestic and foreign con-
Sumers are declared to be pretty well
bought ahead and for this reason little
demand is anticipated Predictions OF
lower prices for the metal are also being
made for the immediate future.
Some good buying appeared on light
scale in the good oil stocks last week.
The stocks were picked up in the hope
that the special session of the Texas
LEGISLATURE. called for Tuesday, will re-
suit in the enactment of conservation
laws. Inasmuch as production in Texas
has been the most depressing influence
recently in the oil industry, the signlfi-
canoe CT the forthcoming session OF the
Texas Legislature may be realized.
hE 10