WISE INVESTMENT -
HAVING whispered words of caution to investors a week ago, I gun- disappointed that the recovery in stock markets has been so pronounced. The economic background, as I explained, 'was good enough to justify a rally, and now international polities have obliged with a rather unexpected turn for the better. With markets still the healthier for their recent slim- ming, convalescence has quickly given place to quite a vigorous display, and virtually every section, from gilt-edged to specu- lative mining shares, has managed to stage some sort of rally. The volume of business has not been large, but what there has been has reflected a fairly general wish, to buy.
Of course, Throgmorton Street is buzzing with predictions of an autumn boom, and that partly explains the recovery taking _place now. When enough people in the City are saying—and meaning—that there will be a big rise in security values in the autumn, one need never doubt that the rise has as good as started. Not all the intending buyers are prepared to wait for the end of the holiday lull, and once the upward trend is there, those hovering on the brink are usually drawn in. Fortunately, the rises recorded so far have not lifted prices very substantially, at any rate in relation to pre-Budget and gold-scare conceptions, so that there should still be scope for worth-while purchases. Securities discussed in these notes will always be recommended at prices at which I judge them to be fair value for the money.
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