The Washington times., 1923-07-14
TRADERS WATCH
GRAIN PRICE
COLLAPSE
Chief Interest Centers in
Economic Effect of Drop of
Wheat to Dollar.
BY w. p. EDWARDS.

Il,
Service.)
NEW YORK, July 14.-Chief in.
terest in the speculative markets
during the past week conVerged
upon the sudden decline in grain
prices IN the Chicago Board OF
Trade and its possible bearing on
our economic situation.
The break in July and September
wheat options below 81, a price
wheat has not sold at since before
the world war, was particularly
impressive because it followed sc
closely the forecast of the United
States Department of Agriculture.
indicating a smaller crop than last
year. Less pessimistic crop advices
from the Northwest, the large
Cargo from last year, and
above all a poor export demand,
were factors more than offsettine
the effect of the Government re-
port, bringing wheat down 25 cents
a bushel below the years high, a
tremendous shrinkage in the farm
ers' potential buying power.
The farmers condition has re
ceived serious setback, which Is
likely to have a far-reaching effect
on general business. The farmers
prosperity is a fundamental neces
sity to all interests.
Effects Of Decline.
The disturbing developments In
the grain pit has brought to the
fore the whole commodity price
situation, and doubt was expressed
whether the decline in other basic
commodities, including pig iron
oil, lead. lumber and sugar, re
Elected a seasonal let-up in indus
trial activities, or whether 1t actu
ally presaged period Of secondary
deflation.
It was pointed out that buying
to replenish depleted stocks is about
completed. The early 1928 rise in
commodity prices may be merely
one of several Interruptions in a
prolonged decline, which in the
past always followed a great war
and which will extend over a great
many years, carrying values con
tinuously to new low points. This
should not necessarily affect pros
perity. as recessions would be grad
ual, financial and industrial infla-
ton already having been partially
squeezed out in the 1920 depres'
sion.
1t remains to be seen whether
the stock market in its decline OF
the last three months has taken
into consideration this possible
change in the economic tide. If So
athe market, by reason of it's thor
oughly liQuidated state, is we'll pre-.
pared to meet this condition with
out any shock.
AS a matter of fact various un
favorable developments in the past
week, such as a startling decline in
untitled orders on the books of the
Steel Corporation, a drop in steel
ingots production. the sharp break
in wheat prices and further reduc
tons in sugar and lead, hardly
caused a ripple, although, on the
other hand, the excellent carload
ing figures, indicating unprece
denied traffic on the American rail
ways, the better outlook in the
copper industry and the decline ir
the weekly crude oil production
the first in several months, failed
to arouse any enthusiasm.
Efforts To UniOnize In Steel.
A great deal Of interest was ere
ated by reports of renewed efforts
by the American Federation Of La
Dor to unionize the steel industry
but the effect on steel stocks wa.
nil. Business on the stock ex
change slowed up considerably. Pro
| fessional traders were in complete
| domination.
The political situation abroad
caused concern in Wall Street il
the early part of the week, due t.
the inability of France and Englan,
| to come together on the Ruhr ques
ton. Premier Baldwins long
ed statement Of British policy dit
not suggest an international com
mission to examine Germany's fl
nancial condition, but suggeste,
withdrawal by France and Belgium
from the occupied zones. Whethe
| the French government will NEE
the British view in regard to tn
evacuation of the Ruhr Is a matte
Of conjecture. However, the Brit
ish view Ia not likely to be fulfIle
in the light of recent happenings
The Ruhr statement is affecting
foreign trade.
| The vnanoxy ~ III of Vuoa uoroau,I, a