The Richmond palladium and sun-telegram. [volume] (Richmond, Ind.) 1907-1939, 1920-12-31

collapse of q worldwide speculation in
commodities and securities which had
been superimposed on the wartime In
flation of currency and credit. Last
springs level of commodity prices was
higher than any on record and the en-
suing fall in staple commodities was
precipitate. Although the year opened
with appearances of prosperity, Japan,
where speculation had been pushed to
the most reckless limits, went into a
crisis during the early spring. and be-
fore the year was over virtually the
whole world was in depression. Brit
ish midas trade and China's have col
lapsed, carrying silver with them; and
the Far East's biggest export COM
modities-rubber tea, hides, and skins
have become drugs on the market.
South America cannot pay her debts
because of the extreme drops in the
prices of coffee, wheat, wool, and
hides and skins. ~.
Europe, naturally, has felt these
trade reactions, and in addition has
had to struggle with increasing cur
rency depreciation, unbalanced bud
gets, and political and credit uncer-
tainties. In our own country the
familiar signs of the waning business
cycle have appeared, such as falling
prices, increasing unemployment, and
ia multiplication of the number of bust
ness difficulties and failures. Atten-
ttion now centres on forecasts of when
! the depression will END.
The following groups of events have
been selected as bearing particularly
/ upon the past financial year:
/ Cd The Treaty of Peace at Yer
| sailles was formally signed and put
into effect on Jan. 10, and the League
of Nations definitely organized on Jan.
IS, in both noteworthy ceremonies the
United States being conspicuously abb
sent.
(2) The presidential election gave
wide discussion to the whole League
OF Nations issue, and aroused consid-
cradle comment upon our future for
eign relations. Domestic issues were
left decidedly in the background
throughout; indeed, they were scarce
ly raised at all. The various financial
markets during the early part of the
year anticipated a Republican victory
as a. prerequisite of business recov-
cry. Curiously enough, the outcome
of the election had been discounted
long beforehand, and the overwhelm-
ing victory of Senator Harding gave
the market none of the buoyancy
which had been prophesied. Obvious
ly, the markets were under the control
of factors more fundamental.
(3) Commodity prices, here and
abroad, reached their record high for
all time early in the year, and then
began a precipitable decline, which has
not yet stopped. Bradstreet's raw ma
terial index of domestic prices at
wholesale reached its record high or
sO.S6aO on Feb. I this year, then fell
off untff~by Dec. l it had fallen 34.6
percent, thus bringing the index down
10 only 48 percent above 1913. The
Bureau of Labor Statistics more rep
resentative index reached its record
high of 272 during May, taking 1913
as 100, but has gone downward ever
since to 207 by November. The Eco
nomist index of British prices rose to
a record high of 80 in March, taking
1913 as 100, but had fallen to 245 by
the end of November. In similar fash
ion Japanese prices, taking the Bank
nf Japan's index, reached record
high of 321 in March, then started
downward persistently, reaching 226
by October. French prices went to
IS4 and Italian prices to 679 in April,
both record highs, and closed the year
somewhat lower. Prices the world
over turned downward this year.
a. Our foreign trade has never
shown such expansion in values nor
undergone such rapid changes of posi-
ton. The excess of merchandise eX-
ports has fluctuated irregularly, de-
spite many predictions that the United
States would soon turn definitely to an
excess of imports. Our excess ex-
ports reached 1915, 100000 in May,
higher than any month in a year then
fell to $77,000,000 by June. held low
during the summer. and rose to S417,-
O000 900 in October as the seasonal cot
ton and grain movements began de-
spite the argument that deprecated
exchange would stimulate imports, our
total merchandise imports reached
their record high of $3.50, 100000 in
June; then began marked fall every
nfpnth to 1921 100000 for November.
OuV exports have moved irregularly,
reaEhing a high of $S2O,000.000 in
Mafrh, the highest for any month eN-
ceIa June last year, and falling to
S57S0O0,000 in August, but exports
have held remarkably high all year.
(5t Foreign exchanged moved err
radically at New York during the year,
the pound sterling falling TO the extra