Current Situation

Trade news continued to reveal a sizeable recession in both production and trade. The basic steel industry in particular has slowed down to a marked degree, and is now operating on about a 60% capacity. In some specialty lines, such as carpets, a real breakdown has occurred.

One of the peculiarities of the present situation lies in the ease and abundance of cheap money, another in the almost motionless and sphinxlike stock market. The latter has apparently entered a curious Sargasso sea, where ships become embedded in a mass of seaweed.

Disappointment was general in the matter of the Bonus Bill, but second reflection has inclined many to look upon it as "bunking the soldier" without greatly burdening the taxpayer. The real cause for the universal air of hesitation throughout Business is undoubtedly the coming Presidential election. The nomination of Mr. Coolidge is assured. But the uncertainty as to the Democratic standardbearer, the fear of third party tactics, and the possibility of electing the next President in the House and Senate are holding financial sentiment in suspense. From present indications it is hard to see how this suspension of business judgment will become either more optimistic or more pessimistic before midSummer, when the election predictions will begin to assume more definite shape.