Evening star., 1934-12-31
STOCKPR|CESFA|L
TO HINT FUTURE
No Clues Given This Year
Whether Major Bear
Move Is Ended.
Continued From Page B-i.)

the regimentation-to use a term in
vented by the opposition-of industry
and agriculture.
1t is possible, then, to interpret the
indecision of the market movement
of 1884 as indicative of a fairly even
balancing of the favorable against the
unfavorable. 1t is also possible to say
that all that was indicated was COM
plete inability to reach a verdict one
way or the other just because the
issues were too poorly defined.
Gold Shares In Demand.
The imitation psychology was best
typified by the gold mining stocks.
They were the popular mediums for
those who felt the urge to hedge
against imitation, and this was true
not only of the New York market, but
in London and on the continent Of
Europe.
AS always happens, over-speculation
developed, with promoters taking ad
vantage of the situation to market
stocks of doubtful value-to put it
mildly.
The gold shares advanced in May
and June. reacted slightly in July,
advanced again robustly in August
and have been declining since, with
minor rally late in December.
A speculation sometimes parallel
and sometimes divergent developed in
the silver stocks. This was partly in
anticipation of general imitation, but
more in expectation Of an advance in
the price of silver, due to Government
buying. Here also overspeculation
developed. with consequent abrupt re-
actions.
Now it is at once obvious that q
rise in these metal stocks was not in
spired by any growing confidence in
business revival. More often it was
just the reverse. The case is different
with the public utilities. The mar
ket for that group Of stocks did di-
rectly reflect the prospects Of the in
dustry, and those prospects were and
are dark
The public utilities in the Fall Of
this year almost duplicated their de-
preston lows. For them it was still
a bear market. If their prices be re-
duced from gold basis, they were
lower in 1884 than they were In 1882,
and comparison is only fair if such
reduction is made.
The reasons for this continuous
sagging of the utilities are well known.
Their income at best was stationary
and at worst declining, while their
costs were always advancing. These
costs went up with the N. r. A. codes
and with rises in wages and in the
prices of materials. Taxes increased
enormously.
Finally, and just as important was
the attitude Of the Government, as
typif1ed in the Tennessee Valley
Authority. 1t is not going too far to
say that the market feared Govern
ment competition with private man
agement to the extent that, under
the auspices Of the Government. a
part of the cost of producing and dis
tributing light and power would be
assessed against the taxpayer. That
meant ruin for the utilities.
NAN StOCkB LaBSdf0Ss
Railroad stocks made a much bet
ter showing than the utilities, but
they Jagged so far behind the in
dustrials that the believers in the
Dow theory could not persuade them
selves that the rise in the mdustrials
signified resumption of the advance
which eliminated in July, 1888.
1t is only when We come to the
industrials that any large degree OF
confidence is warranted. At one time
or another during 1884 pronounced
strength was displayed by the chem
ical stocks, the merchandising and
mail order shares, the building con-
struction issues, the packing stocks
and various specialties. In most cases,
the huge Government spending pro-
gram helped-an influence particu-
larly In evidence in retail trade.
Higher prices for agricultural prod
ucts, plus Government assistance,
raised farm purchasing power with
great benefit to the corporations doing
business with the farmer. The reser-
vation here is the uncertainty as to
what will happen when Government