New-York tribune., 1921-11-07
Banks Hold
Back ON Loans
For Materials
Judicial Limit on Profits
and Labor Wage Scales
Discourage Spectators;
Little Brick on Hand


Rent reduction, representing the
first fruits OF the tax exem ption ordi-
nance on habitation building construc-
ton, is bringing with it new prob
lem, that of maintaining the recent
rate or dwelling space production,
whlch alone can make housing relief
permanent, says the current Dow Sery-
ice Daily Building Reports.
vast quantity of dwelling space is
beng thrown on the market out Of sea
SON. In the Bronx. for example, apart
ments built to rent for $25 to S27 a
room, are being offered at 500. This
represents, roughly speaking, return
Oh from 10 to 10 per cent on the in
Vestment; Even at 10 per cent the own
ers say they can find investm ent incen-
tive on habitation building speculation.
put when the courts set up limit of
. per cent the speculator quails, in the
lace OF the ascending price of materials
and the slight prospect of a marked re-
ductlon in labor wage scales, mainly
because he has no assurance that some
other Judge in still higher court will
not rule that per cent is the proper
return upon home building roiect
Tor the investor
The question in the public mind to-
gay IS, What Is making the price of
building material higher"
The case Of common brick is fairly
typical of the market. Banks in manu-
1acturlng centers are disturbed by con-
s'ant utterances to the effect that a
condition exists in the Hudson River
orlck Industry of conspiracy. combna-
ton and illegal control of distributing
marsetay in violation of the law. These
allegations have never been iudiciallv
affirmed, yet the banks, acting conser-
yatlyely. and being guided by natural
business prudence, have by their at
tlCude discouraged loans to operators
of leased yards.
Many Brick Plants Closed
On the Hudson River there were.
ten years ago, l19 brick manufacturing
pants, producing annually 100000, 900
common brick. About half of these
plants were operated on leases To-
day there are only fifty-fve yards OPP
Grating N the Hudson district. of which
majority are yards operated by own
ers- The greater quantity of leased
yards in the Hudson district supplying
TINS market with brick are now and
have been idle since 1915, and the de-
preciatlon of the machinery and of the
buildings that house it makes il lit
orally true that the shores of both sides
OF the Hudson River, from Yonkers to
hlngston, are lined with plants that
could not be operated again in the
manufacture of brick without being
practically equipped with new machin-
cry and the structures themselves he
ing almost entirely rebuilt.
There is no way for this industry
to De rehabilitated until the banks
Will once more make loans, as formerly.
to enterprlslng brickmakers, and this
change of lending policy cannot be ex-
pected until either the charges of
brick making conspiracy in the Hud-
son River district are judically sus-
talned or thrown out of court
Such a condition affects the law of
supply and demand. On Saturday
there we're only two barges of brick
available for the building industry of
city OF 100000 people, with con
struction activity greater than at any
time since before tie war in certain
kinds of building work, and yet, the
wholesale price of $14.50 to SIS thou
sand for common brick was firm, where
as the price of this basic building
commodity would not be anything like
that figure if brick production could
be raised to something like normal
proportions.
III SllgnLiY dlHerent ways. but prac-
tically the same, other building mate
rials have been under produced, sim
ply because the period of public accu-
sation has so long lain upon the build
ing material industry, as Il whole that
manufacturing finances have been re
tarded, to say the least, and, in conse-
quence, producers have been confined d
! TO the use of their own capital. In
the face of an increasingly active
building construction market, out Of
season, at that, demand already is ex-
ceediRg supply. and prices are heading
upward. Lumber, for instance, shows
a production of 1000 900 feet in the
week ended October 2S, as against ship
ments of 5000 900 and current orders
Of 92,O00,OOO feet
Advance in Copper Wire
Here are a few market citations at
the week end, showing how generally
this condition applies:
On top of the recently predicted 5
per cent advance in rubber-covered cop
per wire another per cent advance is
recorded. per cent advance has
occurred in B-X cable and per cent
advance is current in electrical cord
The electrical cord manufacturers have
more orders on their books than the
mills can produce, working overtime
Electrical pOrcela1ns are now expected
to advance. There will be an advance
of from 81 to SO a ton in wire lath on
Monday or Tuesday. Before spring
Portland cement will be sold at high
er figure than the present quota tions
Even secondhand brick is higher
There is going to be an advance in
structural steel prices. The price ad-
vances in lumber are not only well
under way, but are fully sustained.
Meanwhile building construction is
proceeding with increasing momentum
and the industry is trying to do bust
ness with the material supply far below
what it should be. The result is that
prices are rising. The present danger
is shat prices will again go too high.
Then the small buyer will be ousbid
by the big buyer for the available
building material supply.
Building material supply can be
maintained if leans to manufacturers
can again be obtained as freely as in
other days. This can be looked for
ward to only when the building invest
nent atmosphere can be cleared Of
long smouldering charges, and this
should be done as thoroughly and
quickly as possible