Flight From Bonds to Stocks 209

the Federal Reserve System codperating with business
 in the control of credit. A dangerous surplus
of gold has been redistributed among the central
banks of the world in aid of the post-war resumption
of the gold standard. This has steadied the levels
of commodity prices in foreign countries and encouraged
 international trade. The comparative
stabilization of gold in terms of goods has given
reassurance to the bond market as well as to stock
investments. The investment trusts and counsel have
led investors to put their eggs in three baskets—
common stocks, preferred stocks, and bonds.
The high plateau on which the stock market now
moves—still far above previous plateaus, despite
the panic of 1929—is, therefore, a result of improved
 order and efficiency in the investment market
as well as in American business.

Post-Panic Increase of Shareholders
While the stock market was falling to its low level
during November, 1929—proving the tragic exception
 to the case for stocks as against investment in
bonds—many observers were surprised at the
increase of the number of shareholders reported
by several large corporations as a result of the
break. Of course, there was the taking up of
margin accounts for which the shares were previously
carried in brokers’ loans, and this explains in a
measure the increases in shareholders. But there
was an increase of more than fifty thousand shareholders
 of the Cities Service Company during that