FINANCE AND COMMERCE.

Press, Volume LXII, Issue 18659, 7 April 1926, Page 10

FINANCE AND COMMERCE.

EMPIRE TRADE.

NEED FOR RECIPROCITY.

DANGER OF DAIRY BOARDS.

(from otm own coMMWirowr.) LONDON, February 24. • Australian manufacturers' claim for greater protection and for increases in the duties now levied on imports ot iron, steel, and other articles provides the subject for a leading article in the columns of the "Daily Telegraph. The writer naturally develops his theme by referring to the Dairy Producers' Boards in Australia and New Zealand. m ,„ _ - • ."-Such-a course as the Tariff Board in Australia is being urged to pursue," says the "Telegraph," "without hearing any arguments which interested British firms may advance, will inevitably be used to render it more and more difficult to pursue the policy to which the .Government is committed, and may check the, movement in favour of closer trade relations between the Mother Country and the Dominions. "In dealings between partners in such an Empire as ours sentiment should, and happily does, have considerable influence. The Imperial connexion assumes that the partners will show a certain amount of favour to each other. That is the idea which underlies the reports of the Imperial Economic Committee. The purpose which is being kept in view is that by the marking of goods, by an educational campaign, and by assistance in marketing, the vast population of this country, mainly engaged in manufacture, shall be encouraged to buy Empire-produced food in preference to'that which is produced in foreign countries. The progress of that movement will be checked unless goodwill prevails on all sides. Dairy Produce Boards. "An indication of the cross-currents which are liable.to impede it was revealed in the recent speech of the chairman of one of the most important multiple-Shop companies, who called attention to the action of the Dairy Produce Control Boards in Australia and \New Zealand in withholding dairy supplies, 'with the intention of keeping retail prices at what those Boards consider a proper level throughout the sea* ( son.' These Dominions have serious ' competitors, on*, it was suggested by this speaker that 'the higher the price demanded for colonial butter the more ' will the Russian, Siberian, and Argentine .producers''get for their butters; and the more Ihe consumer here will require to" pay.' . , Mutual Consultation. •'/' This. is the largest • eusonr aim; wfth r a great army of workers engaged ih,' manufactures, of' one kind and another, to rely.more and.more on the ' Dominiohs • for the foodstuffs that our industrial requires. The work, pf the, Tariff, Board, in Australia on the one hand, and the Dairy Produce-

Control Board :■: and. otherorganisations of\lil(:e:cliara6ter: otytbevpther, touches ~' problems whiehr demand tlie most careful and deliberate consideration. The

basic .principle's' to be borne .in mind / ■ ar« ! that evei^ ; interference witli the lawfof supply arid demand is attended by risks, and that all trade, even interImperial trade, i» obviously a matter of'exchange of commodities. Artificial restrictiopa,' by'whatever motive they may be•.prompted,.and in whatever Country they may be 'initiated, must , demand . mutual. consultation if the growth' of: a healthy and well-balanced , trade between the several parts of the is not to be checked/'

:^.,;;^S^^■m;;N.z. /

PROFB6BOR STAPLEDON'S VISIT. (ntoK on own coussroxsan.) •' , l LONDON, February 24. On February 27th, Profeasor R. 6. Stapledon, M.A. director of the Welsh' Piand Breeding Station, University College of' Wales), accompanied by Mrs Stapledon, trill leave by the Aeneas via 1 the ,Cape, en route to New Zealand

via, Australia. , , ~■, .C'h'e Welsh Plant Breeding Station is ' one'of the Itese'srch Institutions under the 1 Ministry ot' Agriculture's scheme lor providing for Agricultural .Research , 'iui.tbefMotheriCountry. ,The Stytioo' ' was ioundedin IM9 largely as, a result of the.' generosity of bir Laurence Philipps,' at. 'life . chief objects of the Station are. to conduct researches with ' jfvfew to tb6-improvement of herbage , plants; "At present the staff is chiefly engaged "tvitii work oVi cocksfoot, the xyo glasses, and red and white clovers. 1(»ey, are' aW.iritere;sted in. oats—the eor«4 of the greatest importance in WalessUnd they are conducting breed- , ing .wark : with this crop. • '-At the Aberystwyth Station investigations .are also conducted relative to > the. general questions of the management apd improvement of grassland, *np\a great'deal of their most important work is .connected with temporary -■ grosw", Professor Stapledon is himself , particularly interested in the ■ whole Question of seed production as applied to herbage plants, perhaps particularly with reference to cocksfoot and white plover, both of which are largely harvested for seed production in New Zealand. ' Professor Stapledon was the first Director of the Official Seed Testing

Station for England and Wales, which was set up in' London during the war , or what was then the Food Production Department, and he is consequently much interested in all seed questions. ' Mrs. Stapledon is a woman with many interests, including 1 the "Women's Institute Movement. She was organising secretary for Cambridgeshire for the ' Women's' Land -Army during the war, and has subsequently much interested • herself in the Women's Institute . Movements. At present she is County Secretary for Cardiganshire, and she is a member of the- Organisation Sub-Com-mittee, at the Headquarters of the Movement *n London. The travellers'expect to be away from "the Mother Country for some months. On the eve .of departure Professor Stapledon is not. sure whether a few weeks will be spent in New South Wales on the, way to ,New Zealand, or whether the journey will be made to Wellington by the-first connecting-vessel. COOK ISLAND CROP.

. DAMAGE BY STORM. " feilM % TOJCGJUM.) J WBLMNGTOK, April 6. A radio mutate receded ty Sir Man! <, Pomare atetec that a atom at th« Cook lalanda laet Thpriday did extenatve damage , i<f the frail crop*, amonntisr to 75 par cant. ' fit the* bananai,and 60 per cent, of the orapcea. « With all the early tomatoea and - toconutt the louer will be aerere. It i* .- expected" iSaf the Tahiti will be a°ble to load , f ot-Jrqlt at Berotonja without >■ trestle.

WALL STREET.

CRASH AND FRENZY.

SLIDE IN PRICES. (rsoK otm- owh corbibeokdixt.) SAN FRANCISCO, March 8. Scenes of the wildest disorder, in which hundreds of speculators participated in a demoniacal manner, featured the latest stunt of New York's stock gamblers to force prices down to the lowest ebb for many months on the New York Stock Exchange, and in the striking melee which ensued millions of dollars changed hands and, incidentally, amateur plungers were denuded of immense sums of money, beaten as they were by the wily machinations of the professional brokers and their cohorts. Breaking all existing records for volume of trading in the history of the Exchange, the stock market crashed in the last hour of trading, despite the strong banking support apparent for a number of high-grade industrial and railway stocks. "Nickel Plate".common collapsed 28 points' to 135 as a result of the unfavourable merger decision by the Interstate Commerce Commission, and over a score of other issues dropped five points to nearly 20 points. The transactions on the big board totalled 3,726,000 and on the curb trading was in excess of a million shares. For five hours frenzied trading conditinued and it seemed as though these American professionals in the art of stock gambling had lost their sensesExcited brokers emulating; dancing Dervishes and the roar of a thousand voices that sounded like the cheering bleachers at a college football game marked the opening of the New York Stock Exchange following the previous day's big: break in the market. The floor of the Stock Exchange and the customers' rooms of brokerage houses presented' scenes, of wild confusion. In some instances veteran brokers, who maintain their seats lor sentimental reasons, were sent to the floor to assist the younger partners in the transaction of the huge volume of business. The rules of the Exchange, of course, prevent any bnt members from actual trading on the floor. A Wild Time.

Frightened gamblers threw overboard one million shares in the "first hour." There were many sheep among the specimens of humanity indulging in these demoniacal scenes. First one frightened individual jumped over the financial precipice, and then scores followed quickly. The big men at the foot of the hill, picked up the metaphorical remains, and that constituted "the profit" from the deluded speculators who had bought stock on the strength of America's greatest period of prosperity, as it has been widely advertised. The excuse for the panic was the Interstate Commerce Commission's veto- of the "Nickel Plate" consolidation of five American railway systems in the, Eastern United States. This unexpected decision of the Commission was interpreted as the end of the present American boom and prosperity was thought to be at an effectual . end. Those who were palpitating at fears that stock would sink to the value of German marks, dashed in madly to sell out their holdings. As might be expected, the bears won a great victory, for next day they forced a change in the temper of the market, profiting by millions' of dollars by re-selling the very same stock they had bought at a quarter price, and placing enormous sums of money in their pockets. Commenting on the subject of the New York panic, George Hihman, the well-known financial expert of Chicago, said:. "Only ten--days have passed since a New York banker of international reputation, suggested that the chief danger threatening American business «nen wait their great expectations. The many persons thought that American prosperity was going to grow into the heavens; that each year would be more profitable than the last; that, in particular, 1926 In business, was sure to surpass 1925. The, banker . added that 1926, as a business year, probably would equal 1925, and this-would be enough. To try for more,would be to run the risk of straining, or breaking, j the business situation. Just now—today—those words are about the best comment upon the panicky flurries in Wall street—not only the best comment, brit the best explanation. "To' any man,' who has kept his head dpol,. there has seemed to be- no excuse in business, • profits, or dividends, for the dizzy prices to which some stocks have been- forced.

Hard Times Discredited. "Now the question'is: What will be the effect'of the collapse elsewhere? Or: Does the collapse of security prices mean thaj hard'times are ahead! Tne writer's prediction is that hard times are,not ahead. There are two main kinds of business upsets that usually forecast hard times. One kind is a money squeeze. At the present there is no money squeeze. There is plenty of credit' at reasonable rates for all sound business! : 'i Another kind of business upset and depression is industrial. There is overproduction at the factories because buyers cannot be found for the goods* Then production of goods is cut down, and working time is reduced. Is anything of this sort involved in the Wall street flurries! • Apparently not." The feeling of approaching industrial depression that spread over the country following the panic on Wall street greatly disturbed President Coolidge, and he felt it incumbent upon himself to issue an immediate statement reassuring Americans in general that there was no cause for alarm.

There were, however, many students of the national situation who believed that the crash in stocks portended the end of America's much-vaunted'pros-perity era, and Mr Hinman himself admitted that the outlook furnished a warning against boundless hopes and expectations. The newspapers, coincident with a later crash in stock prices on the New York Stock Exchange, which had the effect of causing a terrific depression in prices on the Chicago and San Francisco markets, began to contain warnings against panicky tendencies by speculators who' were flooding the exchanges with orders for dumping securities overboard. Prosperity "Unimpaired." Assurances that economic conditions are sound, and that no alarm need be felt "because of violent fluctuations in the stock market were given by Secretary of Commerce Hoover, and Secretary of Treasury Mellon. Intermediate . movements in the stock market were "not necessarily, and usually were not, an-index of the condition of the country, Secretary Hoover averred. Nothing had happened, he said, to change the intrinsic value of anything in the country. He expressed the conviction that speculative values were very largely a matter of psychology. "All the criteria oh which real economic stability is based are favourable," said Mr Hoover. "There has been no intrinsic change either in values or in earnings. Employment is at a very high level except where it is affected by usual seasonal, conditions. Production generally is larger than a year, ago.

Commodities are moving quickly into consumption with no speculation, and without the accumulation of undue stocks. Actual savings are at a very high level. Building and improvements aro going ahead on a larger scale than last year." Secretary Jiellon took the view that the break in the stock market bore no relation of consequence to the general economic condition of the country, and he anticipated that the market would soon establish an equilibrium, that, in the end, would result favourably for the general prosperity of tho country. He saw no reason for alarm, describing the present disturbance as only "a little more extreme than usual," and saying that it did not touch the underlying bases of business. "The bear market does not touch the fundamentals of the business situation," said the Treasury head. "Such slumps are usually caused by excessive speculation, and the result is an easing up where prices are running to an extreme. The reaction is simply an adjustment. Even where there is growing prosperity there are setbacks, but this one is a little more extreme than usual." There would be a return swing after the flurries on the stock exchanges, and no injuries would occur, he thought. Depression and Loss.

Placing blame for the depression in stocks and loss to the nation's investors on the shoulders of New York brokers, Herbert Fleishacker, president of the Anglo and London-Paris National Bank of San Francisco, and known throughout the United States as a leader among conservative bankers, issued a statement pointing out that good, stable stocks should not be sacrificed at a loss, as they still held their intrinsic value.

His statement said: "The present miserable conditions in the security market are unjustified and unjustifiable. They are purely the result of a system which has grown up among brokerage houses in New York, which is unmoral and which should be the subject of stern corrective measures.

"It is a notorious fact that many brokerage concerns in New York have pursued the practice of getting together and forming what is known as a pool to boost some particular stock. They do this regardless of the intrinsicvalue of the stock, and we have seen the spectacle of stocks worth 25 dollars selling at 75 or 80 dollars per share. "These stocks are unloaded on the general public with the inevitable consequence that the crash comes when ifc is realised that the earnings and potential values and physical values do not justify the selling price. "There is more misery throughout the United States to-day than many people .realise, and it is due in the greatest measure to these professional traders, who know little of the in-, trinsic value of properties and care less, as long as they can create a market for their particular purpose. "Those securities based on real values are just as good at this minute as they were ten days ago, and anyone who- owns them is foolish to be disturbed by the ; present situation. Unfortunately many people have bought securities which did not have values underlying them, and they will be injured'. This misery is due to the unjustifiable tactics of those brokers who have deliberately created a false market for weak securities." METALS. (bit cable—pebss association— copyright.} (australian and k.z. cable association.) (Received April 6th. 8 p.m.) LONDON, April 5. Copper—Spot £57 18s 9d; forward £SB 16s 3d per ton. .Lead—Spot £3o,j3s 9d; forward £3O Ts 8d per ton. Spelter—Spot £33 lis 3d; forward £33 13s 9d per ton. Tin—Spot £287 17s 6d; forward £273 Ts 6d per ton. Silver—Standard 30d; fine at"' jper oz. WHEAT. NEW YORK, April 5. Chicago wheat quotations are: —May, new 1571, old 156 i; July, 135 i; September, 131 cents £er bushel. EGG AUCTION. Messrs Harris Bros., Ltd., report that the usual weekly' auction sale of Feather Brand, guaranteed fresh eggs was held in their rooms, 158 Hereford street, yesterday after' noon. The following prices were realised: —Hen eggs, first grade (2oz or over), 2s 3d; hen-eggs, second grade (under 2oz), 2s Id. —6