Evening star., 1935-07-28
IDLE FUNDS PUSH
EQUITIES UPWARD
ON BROAD FRONT.
Abundant Supply of Easy
Money Lifts Market to
New 1885 High.
EARNINGS INDICATE
TREND TO LOWER COSTS
Steady Forward March of Trade
Also Spurs Securities-Talk
of Imitation Revived.
BY CHARLES F. SPEARE.
Special Dispatch to The Star.

special DlSpatch TO The star.
NEW YORK, July 81 (N.A.NA).-
The influence of easy money and
abundant supplies of it has once more
been apparent in the stock market
of the week. The market has been
active and broad, measured by the
years standards, and las touched q
new high price level for the season.
Not only have common stocks been
in demand but the list of industrial
and public utility preferred shares has
profited by the effort of investors to
find a more compenSating outlet for
their capital than Is afforded by
bonds.
The basis for the strength in equi-
ties is the steady upward trend Of
business, In spite of its handicaps,
with some Of the speculative mem
bers of this group temporarily influ-
enced this week by a renewal of the
agitation in Washington for currency
imitation.
AS the statements of industrial
companies for the first half of 1885
appear, it is clear that many of them
have gained control of their expense
accounts and are nov receiving the
benefits of sales policies adapted to
the times. 1t is mostly those con-
Germs that have refused to change
their methods and the character of
their products and have expected their
traditions and prestige tc carry them
along that show the least improve
ment in the industrial expansion of
the last year.
Bonds Less Attractive.
The rate of return on money in
bank, In grade AAA or AA corpora
ton securities and IN Government
and municipal bonds IS so low that
the public, as frequently happens un-
der such circumstances, is turning to
stocks and to real estate for capital
appreciation and income on capital.
There Is no incentive for the private
investor. and less each week for the
Institutional buyer, to purchase the
new issues Of refunding bonds at cur
rent yields. On the other hand, there
is strong temptation for the holders
of premium issues to realize their
profit while it is available. 1t will not
last forever. Neither will cheap
money.
With another gain in the volume
Of output, the iron and steel industry
this week shows ratio of production
to capacity of 4312 per cent. It has
recovered all the loss between the
middle of May and the 1st Of July.
The important feature of the expan-
sion in demand is that it comes from
many sources. It reflects the general
improvement in business. Buyers who
have stood of. expecting break in
prices, are now concerned over Au-
tumn deliveries. The quotation of
scrap steel, regarded as an accurate
barometer of price movements in the
trade, has been steadily rising.
In another direction-the building
industry-there are signs of a change
in the attitude of the public, including
the largest volume of construction in
Greater New York since 1881 and
manifold evidences from many Sec
tions of the country of renewal of
apartment and home building and a
greater amount Of repair and remod-
cling work than since 1919-20.
The latest figures of electric power
production are in line with those re-
ported for some months. They indi-
cate an increase of 8.6 per cent for the
week of July 20 over the same period
of 1884. There is still much improve
ment necessary in the car loadings sit
uation in order to bring steam trans
portation to the level of other basic
industries. The hope held out for it
is that it will soon begin to reflect the
larger volume of shipments from the
centers manufacturing durable goods
and those from which the 1885 wheat
crop will be shipped.
Farm Income Increases.
According to a Standard Statistics
chart, the total farm income this year
will be the highest since 1880. Com
pared with the low year, 1882, the dol
lar value of farm products will show a
gain of about 70 per cent. Taking the
price relation of March, 1888, and
July, 1885, as to what the farmer re-
ceived for his products and what he
paid out for essentials purchased, it
will be found that the one has more
than doubled, while the other has
risen slightly over Is per cent.
The basis Of comparison Is, Of
course, perverted by the abnormally
low farm values existing two years
ago and the moderate rise in whole
sale and retail merchandise prices
(Continued on Third Pags)