The New York herald., 1922-06-12
FINANCIAL NEWS
AND COMMENT
Rise of Commodity Prices Evil
dence of Great Change
in Business.
MORE FREIGHT LOADINGS
Stocks Trend Downward, Sug-
gesting Less Speculative
Power for Rise.
MORE FREIGHT LOADINGs

II one sought no other proof Of great
change in business this spring, compared
with that of last autumn. the rise which
las occurred in commodity prices would
be enough to emphasize the point. ~Cot-
ton last week went above 22A cents a
pound for shipments Immediately deliv-
cradle for cash. The price in New York
on September TO- early in the current
cotton year, was 19. 80 cents; on January
10 it was no higher than 1920 cents; on
March 10 it had recovered slowly to
$50 cents. and on the last day OF May
1t was 2l.20 cents. The upturn of that
staple has been slow. but it is represen-
tative of what has been going on quietly.
almost imperceptibly, in some directions
all OF this spring and part of the winter.
Steel, iron, textiles and finished clothing.
rubber. copper. sugar and wool are
among the most prominent products
which have risen.
The mercantile surveys of last week
referred to the price as evidence that the
business recovery was being extended.
1t was noted that retail trade had i'm
proved so far in recent days that the
crge to contract ahead was becoming
pronounced among merchants. Future
buying. which previously had been SUBJ
merged by the desire of distributors to
play close to their chests by ordering on
week to week or month to month
basis. acted to stimulate factory output.
That in turn necessitated the employ
ment of more hands and the ability OF a
greater number of workers to keep
steady employment had a broadening
effect on the purchasing power Of the
public as whole.
All of these factors are part and parcel
OF changing business period. new
high monthly record of automobile pro-
Guction in May paints a clear picture
of the condition of industry and distri-
button in an important field.
Car Loadings Gaining.
Tho maintenance Of 20 to 70 per cent.
of steel mill operations, despite the pro-
ionged coal strike, discloses a rather
satisfactory state OF affairs in another
wealth producing line. And increases Of
car loadings week after week tell their
own story of demand for goods much
IN excess Of the buying of 1921.
Undoubtedly an influence in the for
ward price movement is the shortened
production of those bitter months OF
last year when all the world was try.
ing to sell in markets in which money
was lacking. The accumulated stocks
Of that period gradually found their
way to consumption and while they
were being consumed the replacement
work was not vigorous. Excess manu-
featuring capacity was found every
where and it was expanded by forces
like the textile strikes in New England
and Lancashire. Now with unemploy-
ment lessened in this country, with pur-
chasing power greater because OF in
creased pay rolls. with the farmers
again in the market after year of re-
trenchment, with strikes still retardins
output in certain directions and threat.
ening to do SO in others. there is not
enough of particular materials and
products to fill the demand without
causing prices to rise.
A reason for reviewing the price
situation is to raise the question
whether or not the movement upward
which has been going on pretty steadily
since last October. can be expected to
continue during the remaining months
of this year. The answer must be
based. of course. largely on opinion
shaped by expectations in respect to the
export trade. But allowance must be
made for another important considera-
ton. namely. the large increase OF
manufa cturing facilities since 1914 in
all leading countries. especially those
which participated in the war.
Buying Against High Tariff.
In the United States unemployment
statistics are still so formidable as to
show thousands upon thousands OF
hands available for mill and factory,
and the certainty that they will be
employed as rapidly as goods mar
kets permit suggests factor likely to
retard the persistent rise OF prices.
1t is possible that much future buying
lately has been stimulated by thought
of high protection against foreign goods
in the forthcoming tariff law. In cer-
tain respects this is a slender reed to
lean on. The voice OF the people is
heard daily in protest against imposts
which would raise unduly the cost OF
living. and the tariff bill is some dis
tance from it's enactment. Numerous
arguments favor the thought that the
present rally of prices will be checked
and perhaps made stable around the
higher levels by natural forces OF pro-
duetion. but such arguments would not
imply that the profits Of industry would
suffer thereby. Enlarged output means
reduced overhead expenses. iessened