RISING PRICES

Rotorua Morning Post, Volume 2, Issue 343, 3 October 1932, Page 3

RISING PRICES

AMERICAN REVIEW FREER SPENDING SHOWS SIGNS OF RENEWED CONFIDENCE •RECEIVED WITH CAUTION. New York, Sept. 7. Signs that the principal farm products are leading other commodities on the way to better prices are emphasised in a cautious review of the Aineriean situation issued by the United States Department of Commerce. The department's summaryj which is supported by London reports of improving markets for primary commodities, points out that prices for farm products are still very low, but the improvement during the last three months coincides with the release of hoarded currency. Freer spending, as the outeome of revived confidence, is regarded as one of the best signs of the times, and the wholesale commodity index figure issued hy Bradstreet's, the authoritative trade journal, shows the most notable continuous improvement for several years. According to Bradstreet's, August showed an increase of 5 psr cent., heing the third consecutive monthly improvement and the largest gain in any one month since 1925. rRpTinrfc; T^ppAivpr? -\vit.h Ckiiitifvn.

Published accounts of improved priees for stocks and shares, the reopening of factories, and the general ' claim that trade conditions are on the up-grade, have heen received with , caution in some circles. The qu'estion j is often asked whether these reports are the actual results of a genuine ch'ange for the hettsr, or are the poli- ' tical synthetic product of Hoover ' manipulation. J The foreign and domestic hureau of the United States Department of Commerce, in a survey of current business, gives in great detail all the business indexes that indicate improvement, and those, as well, which suggest that the big slump is still "getting in its dirty work." ■This source of authoritative information frankly says that while the security markets have moved forward confidently since the middle of July, accompanied by an upward trend in commodity prices, the course of business activity continued downward during most of the last six weeks. Notwithstanding sporadic spurts to manufacturing, the fact is that a long list of such industries have shown production declines since the bureau's last veport. Besides manufacturing production, merchandise distribution by +he railways has of late shown a decline heavier than anticipated. Department store saies dropped 6 per cent., foreign trade was sharply reduced, and emp'loyment revealed a further important reduction.

Sharp Rise in Commodities. On the other hand, commodity prices, including those of important fax-m products, have made a marked advance with firm and continuing progress. The sharp rises in meat and grain which began in Juns have spread to a large numher of commodities. The unsatisfactory feature is that the prices of farm products remain very low; the bureau puts them at an average of 45 per cent. lower than the 1910-1914 average. Since June the bank situation has steadily improved; there have been fewer suspensions, and the depusit liabilities involved have heen much smaller. The steel industry, without any definite measurahle change in the volume of business, has given evidence of a more confident attitude.