Current Situation

Bond prices have apparently reached their peak, and banks are steadily liquidating their holdings in preparation of rising interest rates and lower bond prices this fall.

Just as Wall Street began to hesitate over a possible rise in the New York Reserve rate, however, the bold rate-cut of the Bank of England (see below) lent encouragement. In the face of this reduction, an advance in the Reserve rate is thought quite unlikely.

As the summer passes, the prospects for higher prices of railway shares brighten. For some months, while 'rails" have been practically stationary, "industrials" have soared. With record freights looming this fall, and with President Coolidge's open stand in behalf of voluntary rail mergers, however, enthusiasm for railroad shares is plainly reviving.

The maximum optimism is still monopolized by realtors. The Florida boom continues, out of season. Recently New York has discovered a new realty boom in its midst at Rockaway, which some believe to be fairly on the way toward rivalling Atlantic City. Building, once far behind demand, is now considerably ahead, according to the statistics of the U. S. Department of Labor, which counsels caution.