Evening star. [volume] (Washington, D.C.) 1854-1972, 1931-10-25
Securities Markets Respond
Quickly to Signs of Re-
viving Industry.
RECOVERY IN COMMODITY
VALUES HELD NOTABLE
Liquidation on Exchange Dries Up
as Better Sentiment Makes
Appearance.
BY CHARLES F. SPEARE.

NEW YORK, October 24.-To have
behind us the period of hysteria. with
its loss of faith in institutions and in
values, is a distinct gain even though
there is little supporting evidence in
the statistics of business and banking
that change for the better has &C.
Cured
Sentiment has improved throughout
the country. More confidence prevails
abroad. Liquidation has been suspend
ed so that the markets for securities
are higher than they were a week ago
In some of the prominent commodities
sufficient recovery has occurred to raise
the present values of farm products
S40O, 100000 over those of early Oc-
tober.
The public that buys and sells stocks
and bonds, that trades in staples, pro-
duceS and distributes raw materials
and manufactured goods here and else
where throughout the world is now
waiting for a consummation of the
plans OF an emergency character that
have been recently promulgated as we'll
as for the results of the momentous
conference now taking place in Wash
ington between the President of the
United States and the premier of the
French Republic.
Industry Shows Strength.
While there have been many corpo-
ration dividends cut or omitted this
week, these have not applied to the
shares of important companies. In
general, they represent the effects of
losses in operating income and in the
income from investments of many COM
panieS that were formed during the
boom period to make money easily
in
sources of the substantial American
corporations have been affected COM
paratively little. Some of them today,
at the end of two years of the Severest
losses in gross earnings ever expert
enced, show an extraordinary ratio be-
tween assets and liabilities This fact
is likely to persuade the directors of
the United States Steel Corporation
next week to declare the regular divi-
dend OF 81 share on their common
stock and to justify the management
of the Bethlehem Steel Corporation in
sharing some of its reserves with its
stockholders.
The General Motors Corporation has
just presented a statement as of Sep
TENDER 80 which shows cash. United
states Government and other market
able securities amounting to 1854 900, :
000 This is an increase of $85, 000, 900
since the end of 1880 and is nearly
SOS, 100000 in excess of the present
market value of General Motors 5 per
cent preferred stock The financial
status of other representative corpora
tons, such as American Telephone &
Telegraph, Atchison, Topeka g. Santa
Fe, Union Pacific, General Electric
Consolidated Gas Of New York and
Standard Oil of New Jersey, to name
few, demonstrates the soundness of the
industries which they represent and the
strength of the corporate structure of
the country. 1t is significant, too, that
in the midst of the most serious de-
preston of the last half century there
have been relatively few important
mercantile failures. though the mortal
ity figure among what might be called
the parasites on business have reached
an astonishing total.
Freight Rate Decision.
The chief incident this week and the
one that has had most effect on Sc
curity prices, was the decision of the
Interstate Commerce Commission in the
Is per cent freight rate case. This ar
rived at the end of a day conspicuous
for the strength of railroad shares. 1t
bluntly denied the request for an in
crease in tariffs and supported the COM
miSSionerS' refusal by arguments that
will be generally acceptable. 1t did not,
however, as in other cases of the same
sort, abandon the carriers in their hour
Of need, but made novel proposal to
which there was resistance in some
quarters but subsequent acceptance of
the spirit of the commissions sugges-
ton.
Public opinion strongly supports the
commission in its denial Of rate in
crease that would have been eco
nomically unSound and of doubtful
value to those by whom 1t had been
proposed. 1t also sustains this body in
the form of recommendation made.
This is in line with the times and,
in sense, supplements the method by
which relief is to be extended by
strong banking institutions to those
that are unable to carry the load which
the depression has placed upon them.
It is never quite agreeable to a strong
and well managed corporation to dig
down into its pocket and assist poorly
constituted competitor out of his diff
cultieS. These are times, however, when
the emergencies are similar to those
in a war period. 1t is the common
good, rather than individual stability
and satisfaction, that must be conSid-
cred. In such circumstances it is ap-
parent that the letter of laws. as, for
instance, the Sherman antitrust meas
ure. is carefully avoided by those who
emphasize its features under different
conditions.
The generally held opinion Of the
Interstate Commerce Commission is
that it proceeds on the theory that the
shipper is right and the railroad Is
wrong and works toward a steady lev
cling down of the average of rates.
There may have been justification for
this verdict out of decisions rendered
in the past A careful analysis of its
latest opinion disputes the claim that
the commission is antagonistic TO pri-
vate management of steam transporta-
ton, for it makes a number of con-
structive suggestions and, for the first
time, shows an appreciation Of the
change in public attitude toward rail-
road credit 1t is for this reason that
friends of the railroads hope that they
will accept the pooling proposal of the
commission and thereby gain the prac-
teal advantages of it and avoid threat
ened receivershipS This friendly atti-
tude also will give them a standing
with the public and its representatives
IN Congress, making it easier for the
carriers to obtain support for measures
affecting the rate structure, consolida-
tons and. pehaps, wages, to be brought
I r F.. 49,