WISE INVESTMENT
To buy or to wait ? This is the question most investors are now turning over in their minds. One side of the investment picture is painted in alluring colours. Home industry, over a wide field, forging steadily ahead. Company profits and divi- dends rising, and every promise of further rises next year. Even international trade improving in face of tremendous handicaps, opening up a better prospect for a large range of Stock Exchange securities. As for the market itself, so obviously stripped of any weak speculative accounts that in virtually every section even moderate buying would provoke a quick rise in prices. Looking at this side of the picture the investor—and the speculator—may excusably feel the urge to loosen his purse-strings and order now to avoid disappointment. There is, however, another more sombre aspect of the investment position which should dictate caution.
Nobody can rate with any precision the risk of a major international conflict, and the City, I think with reason, is not disposed to rate it very high, but it is clear that we are not yet outside the range of recurrent shocks, some of which may be serious enough to disturb investment confidence. In these conditions and with holiday influences steadily approaching their full strength in reducing market activity, I can sympathise with the investor who feels that discretion just now may prove the better part of valour. Only a really major change for the better in international politics, one may be sure, is likely to initiate a sustained rise in security prices in the middle of the holiday season, and the chances of such a development taking place look rather remote. Balancing the inducements against the deterrents to buy, I should say that there is not much to be missed by waiting until the end of August. It is at least possible that the clouds of international politics will have lifted a little by that time, and meanwhile we are not likely to see a runaway market in Throgmorton Street.
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