Stock Blister

After a few warning twinges, the glossy blister of high prices in the New York stock market burst explosively at the prick of the rail merger ruling at Washington (see p. 28). Widespread pain was experienced by the speculating body public, as leading rail, motor, industrial and chain-store stocks oozed out 10, 20, 30, even 50, even 80 points, even 100 points.* The nerves of finance carried the anguish to distant cities.

For two days it continued--days worse than Rich Men's Panic (1901) and the dark April and May of 1920. Wall Street volume-of-trading records, set only last fall by the rising of the blister, went glimmering. The new figure was 3,734,031 shares traded, in March 3. The ticker was 52 minutes late.

Reaction came sharply. What had happened was "too awful" and the banks rushed out to support their customers. Bears licked the blister better by covering their short sales.

Meantime business, the buttress of finance; business, which had not impelled the late financial gyrations; business--despite the violent vibrations from above--maintained its excellent present equilibrium.

*One of the first stocks to go, and go farthest, was Devoe & Raynolds, from $140 to $40. Justly indignant at aspersions cast, Treasurer De Lancey Kountze declared : "If there is any maniplation . . . it is being done without the knowledge or consent, directly or indirectly, of the corporation or any of its officers."