Show r J S. S f f I r igi Situation Culminates s h 0 Recent Stock fi arket Advance e i European E Situation Held Serious Investors Advised ed io io o oY Y Watch atch Developments of t I I Foreign Exchanges Q Byg Major Alva Aha Lee S y Manager Bond Department J. J A. A Hogle Co Th The recent rise in the st stock mart marS mar- mar S t appears to have havo culminated It ItS S t- t doubtful i-doubtful If the upward movement Can n continue at this time In th the face Ul It the adverse foreign news and the tile very rapid decline in foreign ex ex- ex change On Friday all European bonds declined but the feature of ot the days day's trading was the slump lump In bonds This decline amounted to to 3 for tor the French Ss 2 1 S for tor the tho 7 s nn and 3 i for the War Loan Ss Exchange rates moved in Ih a similar manner Sterling touched ched l S 1 5 1 S the low for a a. period o ot nineteen months and the franc reached riched the low Jow point tor lor all time This decline Is Is is-a is a just measure of ot the tho Ier seriousness of or the An French Anglo lo French controversy As I pointed out o er overa 11 year gar ago the tho Ruhr Ruh and reparations Is not a a. controversy be- be teen t Germany and France Germany Germany Ger Ger- many is fulminated bec because se she hasso has no so military strength Th The contest Is between E land and land France and the Issue lesue to be decided Is which of ot these countries dominate hist His His- 1 t 3 shows us ills that this s n nie issue lies has arisen between these two countries countries coun coun- tries on other occasions and anti was twice settled by a resort to war In Inthe tho the present case calle unless one nation or the other reverses Its J policy war S. will bo be the thA outcome The most important domestic domestic de development development de- de during ng the tho past week was the statement b by Secretary Mellon advocating a reduction In federal taxes Whether or Ot not tases can b be reduced depends on whether or not the bonus bill be becomes omes a law It now flow seems probable that this bill will be passed by congress vetoed by PresIdent President President dent nd and then allowed to die a natural death It be passed because members of ot congress sg are re scared of ot the tho legion vote and the election is near It Is evident that the tho president will veto it it otherwise Secretary Mellon would d not have written Yf his fn letter to the acting c g cl chairman chairman chair chair- I man of the ways wars and means committee commit commit- I tee Just three weeks before congress It will not be is Is' Is to be bo convened I passed over over- his veto because such ac action action HC- HC tion would be tantamount to r repudiation atlon of ot his leadership on the eyeS eve of ot a fI pr presidential election The Tl fact fac should not he be lost sight lIght of ot that the bond market has already discounted the passage of of this this' bill Its unexpected defeat would be a 1 strong bull buH factor in the bond market marlet arid and a So lowering of ot federal taxes would certainly contribute a a. stimulating effect effect ef ef- ef- ef feet to the stock market The general outlook in the bond market seems to be be- good Bonds Bond should remain firm during durin the next month or t tv tWo o o and advance during th the next six months The stock m market may ay advance i i a bU bUo point o or two 0 from Present e t but wo we believe prices will be lower during the the coming winter than they are now Advise Investors to watch foreign exchange rates rate carefully A drop in inthis this rate means a curtailment t t tI in European Euro buying YI power w and riis it ri- tl l is In Europe Europe Eu Eu- rope America must market a great I deal of or her surplus |