PANIC IN PRICES IN U.S.A.

Hokitika Guardian, 18 December 1920, Page 1

PANIC IN PRICES IN U.S.A.

RETAILERS STAMPEDE. SAN FRANCISCO, Nov. 14. Panic lias seized the selling interests in the United States, and the signs of nervousness have been quickly reflected in Montreal, Toronto, and as far AVest as Vancouver over the Canadian border, in .consequence of a phenomenal movement toward the deflation of the postwar profiteering prices. The attitude of the purchasing public has been one of apparent independence, and the retailers have discovered that the workers were not further to be “used” as mediums of foisting commodities upon them at the outrageously high figures which for a time the profiteering wholesalers and retailers had succeeded in wresting from the people at large. It is now noted that the period of extravagance indulged ip by the people has long ago terminated, and when the “common people” held aloof from further buying at exorbitant-prices, _ the retailers began to become uneasy at the falling off in their weekly returns. In vain they filled the newspapers with cunningly-worded advertisements, but, generally speaking, the populace would have-no truck nor trade with the profiteers.

The retailers appealed to the wholesalers for relief; but the latter replied that they had adopted a new principle of manufacturing only to explicit orders, and were not stocking for eventualities. They explained that owing, t an uncertain market it was beyond the pale of speculation to hoard supplies, awaiting receipt of Orders front the trade.

The retailers, possessed as they were with tremendous stocks of goods which they were unable to “unload” upon the public at tlie market prices, found that ruin threatened them, but they were compelled'to keep tlk; goods moving, and at the present juncture all sorts of crude and transparent devices arc being restored to by the panicky shop keepers, in order to “raise the wind,” to meet their pressing creditors. RETAILERS AS “MARTYRS.” The newspapers have been converted into advertising mediums, and so rapacious have the storekeepers become upon the space in the daily newspapers,, that only curtailed news is seeing the light of day. This movement is spreading all over the North American continent, aiid some clothing firms hay: taken two full-page advertisements to unfold to tlie public their “grievous” position, arid have endeavoured to persuade the public that the present is tin best time to make purchases. TJieso retailers have admitted they are “willing to take their medicine,” and hav: reduced prices to what they are please.! to designate “pre-war prices,” but in most cases the figures are more than double they were on Armistice Day. Consequently only the unwary are being entrapped, tlie great percentage of the people refusing to be bamboozled by the retailers, .who are posing in the public prints as “martyrs.” It. is only when real bargains are obtainable that tlie general body of the purchasing public makes an. investment, and it is recognised that the profiteering retailers of both the United States and Canada will have to “take their medicine,” with a vengeance. Certainly, they are securing no sympathy from their old time custodiers.

In Rochester, New York State, a reduction of 33 per cent in tlie wholesale price of clothing has been announced by one of Rochester’s largest clothing manufacturers. The reduction, which is in addition to the usual cash discount of 7. per cent, represents a cut from 33 dollars, opening autumn whole sale price on suits and overcoats, to approximately 20 dollars. . ’■ ' PEOPLE TO BENEFIT.

Much of tlio pessimism which ha-; spread over the country is unjustified, according to John AV. Hill, a New York financial editor, who says: “Prices hav: fallen faster than was expected, failures are increasing, manufacturing plants are slowing down, unemployment is growing, and buyers and sellers continue for the moment- to back away from each other despite lower prices. But the picture has a bright side. Profiteering is dying. . Extravagance has disappeared. The cost of "living is falling. It is again possible to save. AA’ages and salaries mean more in bread and butter and shoes. Business activity, prices, and profits are moving steadily towards a more healthy basis.”

Many believe that tlie country is now going through the most painful port of the surgical operation necessary to remove the noxious u-rowfch of war inflation. The money crisis is passing, and lower rates of interest are on the way, and when this arrives it i\ ill stimulate activity, it is believed. Longheaded business men are laying their plans for a business revival, but not a boom, next spring. JA’hile conditions have been unsatisfactory in the United States, New York experts, in reviewing tlie situation, have been pluming themselves that in the rest of the world .happenings have Lfceri more of a disturbing nature, notably the recent coal strike in Britain, and upheavals in Cuba, Holland, and some South American countries, with a “number of other nations quaking in their financial boots.” Americans recognise that "business reaction and the decline of artificial prices arc worldwide developments. These things have been reflected in America in lower prices for wheat, cotton, and other commodities. The United States does not anticipate any financial panic, as latest Government figures show the resources of all the banks in the country total 53 billion

dollars, which is declared,to he greater tlian the combined assets of the banks of all the-leading nations of the world, a fact that has caused much flattering vipetion to bo laid to the hearts of all those Americans inclined to gloat over the troubles of European nations who bore the brunt of ; the world-war. c AA’HEAT PRICES TUMBLING. '

Exciting scenes have been witnessed iii the Chicago wheat pit, where the stock speculators have indulged in some extraordinary demoniacal antics' in a vain effort to dispose of wild ventures on a falling market.

Tlie Federal Reserve Board lias refused credit to farmers for withholding crops from tlie markets until prices could ho forced back to wartime levels. The Board could not maintain prices for the grain, Wool, and cotton growers and allow prices of all other commodb ties to tumble unchecked. Farmers’ losses will not be so great as they now fear, because the purchasing power of their dollar will lie increased.

The grain pit has been tlie subject of bitter attack by farmers. There is no defence for tlie abuses of trading in grain futures, but legitimate trading is recognised as an economic necessity. Cash grain buyers and flour mills call it “hedging.” The National Coal Association has announced that the goal of 12,0.00,000 tons meekly coal production lias ' 'keen attained, thereby assuring the country against a coal shortage. Prices in some sections have already begun to tumble. Textiles and clothing, according to Government returns, are “sliding,” hut in many instances are still 10Q per cent above pre-war levels. Prices' of farm products decreased 15.6 per cent in September, against 12 per cent in August.