It is true that adverse legislation sometimes seriously impairs the value of a security. A public utilities company, for example, which is forced to reduce its selling rate, is unquestionably injured from an investment point of view. Such legislation, however, may be weighed correctly by a little calm consideration, and it may be said that action of this nature is usually for the purpose of correcting abuses, rather than as a revengeful and confiscatory attack on vested interests. Measures which prevent a fair return on capital will perish of their own iniquity. So far as measures which are formed to prevent extortion are concerned, it is impossible to criticize them. In order to correctly weigh the effects of legislative measures on security values and prices, we must therefore examine fairly what the legislation seeks to accomplish, taking care not to allow a contemporaneous price movement which may be due to other causes, to act as a verification of a false view. This error occurs very frequently; in fact, one of the most remarkable things about speculation is that the true causes of great movements are fully appreciated by the majority _only in retrospect_. The probable market effect of legislative and political affairs can be correctly gauged only by examining the nature and importance of the issue in question. This is true not only of state and municipal action, but in regard to presidential elections. There is a popular idea that it is dangerous to buy stocks on the eve of a new presidential campaign, but there is not much in history to uphold the view. True, in a majority of cases, a decline has preceded such a contest, but there have been frequent reversals of this action, and we have had too few elections to attempt any chart-playing on this influence. Such a guide would be empirical. The issues involved in a presidential contest, however, may sometimes influence prices. Here again a careful examination of facts and probabilities will generally uncover the truth. If the nominee of one party stands on a dangerous platform and the outcome of the contest is in doubt, we may well dispose of shares if for no better reason than that the element of danger is present. Danger, whether or not it is finally realized, is a bear factor, just as safety is a bull factor. Tariff agitation should be accorded careful consideration by the speculator. This is particularly true as regards the effect on industrial corporations. A reduction of the present tariff on Iron and Steel, for instance, would materially lower, if not destroy, the value of many of the common stocks of steel manufacturing corporations. A very clear and comprehensive work on this subject is mentioned in the bibliography on page 183.