WISE INVESTMENT
MARKETS are a sad spectacle. Indeed, this week's events have strongly resembled an air bombardment (new style) in which non-combatants have suffered equally with those in the front firing line. Speculators' losses, although regret-. table, are part of the City's life, and those who overreach themselves foolishly and come to grief are given quiet burial; but this collapse in "investment stocks," like Imperial Tobaccos, British Oxygen, Turner and Newall, and Shells, is a sad blow for holders all over the country. I do not know what this week's depreciation of sound industrial securities on the Stock Exchange represents in money, but it must run into millions of pounds.
It is the old, old story of dislodging of speculative positions which become weaker at every stage of the decline. As prices go lower commitments have to be reduced and the brunt of the selling falls on to sound marketable securities, for the simple reason that in difficult times they are the only securities which can be sold at a reasonable price. So far, there has been surprisingly little buying support, most would-be buyers having been deterred by the very steepness of the falls. But unless a trade slump is really on the way, which I refuse to believe, prices of British and American industrials are at ridiculous levels. In present conditions, I cannot advise any but the bravest of investors to enter the market in ordinary shares, although I feel confident that those who buy now will reap the reward of courage and patience. But I do advise those who hold sound equities to see things through.
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