COST OF CLOTHING.

Taranaki Daily News, 29 May 1920, Page 12

COST OF CLOTHING.

RESULTS OF GAMBLING. SIDELIGHT ON AMERICAN TRADING. A recent cable message from New York referring to .1 sharp fall in prices on drapery and clothing in the United •States, attributed the cause to a tight money market and restricted retail buying. It was further stated that the tanks had been officially recommended to liquefy credit extensions in order to stop the speculative holding-up of merchandise. Mr. S. Kirkcaldie (Kirkcaldie and Stains, Ltd.), when asked by The Post If the cables meant a general fall in prices of drapery, remarked that the slump was caused by eagerness of speculators in merchandise to sell at any price, to cut their losses. Conditions of .trading in America are slightly different from those of Great Britain and the Dominion. The order in the States is: Manufacturer, selling agent, jobber (or warehouseman), and retailer. But there are speculators who buy up large quantities of goods; from the selling agents in order to corner the market- . Goods which they never see, never handle, do not know, are so bought, and change hands before they reach the jobber. It is pure gambling, and the practice is common in America. The links in the distributing chain are as above stated, but the speculator thrusts himself in. So he creates and endeavors to create an artificial scarcity, and, of course, looks to reap a handsome profit by his control of the market in any commodity. The textile and clothing trades have their speculators, and it is evident from the cable .messages that they are frantic, to sell. They have been caught It does not follow at all that there has been a genuine fall in prices, or that the present collapse of the speculator heralds in a general reduction. On the contrary, everything is against it. True, United States manufacturers have been turning out a very large quantity of | goods, and thus have upset speculators' calculations. EFFECT OF EXCHANGE. "Then the factor of exchange has to be taken into account, for buyers for Britain and Australasia have closed their order-books with a rate of 3.88 dollars to the pound. That lias resulted in vast quantities of American-made goods having to be absorbed in the domestic market because export is virtually closed. There is a glut of manufactured goods in America, hence the discomfiture of the speculator and the rush to sell"With respect to modification of prices,'' Mr. Kirkcaldie continued, "all I can say is that we are advised from Manchester that raw cotton, which on 7th March was IGd per pound, advanced on loth March'to 2Md per pound. Scottish woollen manufacturers intimate that they are already so booked up with orders that they cannot look at any new business for 1941. Advice? from Nottingham hosiery manufacturers are to the same effect. "The whole world is short of clothing, and until that shortage is relieved there can be no moderation of prices. They may go higher. The British domestic demand itself is enormous, and at present insatiable. There is a great and insistent demand from the Continent, and, during th* past few months, from the United State! also,

"There is no indication, so far as we ean see from any of our advices nor from our trade papers, that encourages Us to look for very much reduction in the price until the world's supplies more nearly approach the world's requirements." A LADY IN AMERICA. A Wellington lady just returned from a business visit to the United States read the cable message above-mentioned as Mr. Kirkcaldie understood it—a mad rush of speculators to sell at any price They are inveterate gamblers, she said, and legislation is now being framed to deal with them. They lived by holding up manufactured goods of all descriptions- Their gains were stupendous; but sometimes, as at present, their reckoning was at fault, things happened that upset them—often the unexpected unforeseen. Visiting manufacturers in the States and Canada and meeting some of the best business men in both countries, the lady said the legitimate manufacturers, at any rate those in the textile trades, were not at all pleased with present high prices. They had far better returns when prices were lower. Costs of raw materials were at phenomenally high levels, and there was 110 sign of their falling; costs off production, too, were never higher and the output, in comparison, was never smaller, Labor was in f.liorfc supply, and its output per individual was much diminished- Being short it was very dear. There is "goslow" in America as elsewhere. j TRADERS FORESTALLED. < As an instance of speculative buying in the United States drapery trades, the lady stated that goods usually available for the trade in November and December were all absorbed by speculators in October last. \Vhen bona fide traders went to buy, they found almost everything they wanted taken by speculators from whom they would have to buy; of course at- a high premium. It was undiluted gambling—not fair trading. Supply and demand were a factor that could not -he ignored, but the manipulation of markets by speculators had a great influence upon the prices of goods. It seemed anomalous, but it was true, that manufacturers were sometimes only too eager to buy goods made in America, and shipped to London. to meet American demands. United States manufacturers are genuinely alnrmed at the attitude of Labor. That attitude was undoubtedly responsible for vast amounts of American capital being invested outside the States. Prices were kept up, too, by the careless way in which money was spent by those people who had never had so much to spend before. There was wanton extravagance to be seen among all classes of people, workers and others. Money is the god of America; money there is everything. If, then, people (lush with money spend it recklessly they must maM the markets high, and those of limited means must pay the current prices, or go without. It is all like old Rome in reckless extravagance and the desire for luxury.