Evening star. [volume] (Washington, D.C.) 1854-1972, 1930-02-18
COMMODITY PRICE
DROP IS GENERAL
Conditions Throughout World
Declared Affected by
T.
0verproduction.
BY JOHN F. SINCLAIR.

BY JOHN F. SINCLAIR.
Special Dispatch to The Star.
NEW YORK, February 19.-"How
can you build a prosperous business on
q falling commodity price level"
This question was asked the writer by
an important United States Government
executive last week. found it hard to
explain away.
Petroleum, cotton and wheat are all
below what they were year ago.
Economic conditions have become
unfavorable in many countries, on all
sentiments" says Brookmire. "Ulti-
mately cessation of the flow of capital
from all quarters of the globe to, Wall
Street should lead to worldwide re-
vival of economic activity. At present,
however, def1ation is in progress after
a rather serious overproductlon OF many
commodities. Reimbursement will take
place and the United States will meet
diminished foreign demand for her
goods during a large part OF 1880.
Other commodities showing lower
price tendency are butter, cheese,
milk. potatoes. raisins, barley, flour, rye,
bacon. lambs lard pork, sheep, wool,
coffee, rice. cottopseed oil and sugar.
The American commodity price level
is declining, but so are the levels IN
other nations. It's an international
condition.
SelbeFIlng comes naCks
Don't be surprised if Frank A. Seiber-
ling returns to his old place as president
OF the Goodyear Tire & RUBBER GO.
some time this year.
1t was nine years ago since Mr.. Sell
berling. the president of Goodyear, pass
ed out of the picture in the awful Smash
of crude rubber prices. He lost millions,
trusted his property, lost his home
and began again.
l1ar
his rescue and guaranteed S5,3o0,O0O
of Seiberling's notes to enable Mr.. Sci
berlinr to start again. The Soldering
Rubber Goa small modest company
was formed. 1t now has become SlO,-
O00, 900 corporation.
It was Edgar B. Davis, who, seeing the
possibilities in rubber, got the U. b
rubber Co. to develop Sumatra planta-
tons. He made several millions out OF
this development.
MT. Davis. meanwhile, drilling oil in
Texas, needed $4,000. Mr. Soldering
leaned it to him, and Mr.. Davis event.
taIIy sold his production for Sl2, 900 600.
Following U. S. Rubber's lead, Mr..
Soldering began the development OF
rubber plantations abroad and cotton
cultivation in Arizona. Both were dlSas-
trous.
Some years after the Goodyear crash,
Mr. Soldering and MIR. Davis, working
through Goodyear Shares, Inc, again
began buying Goodyear stock. To-Day
they control the largest single block.
Then Cyrus S. Eaton, partner IN
Otis & Co. of Cleveland, saw POSSIBLE
ties in rubber, and began buying Gooa-
year through one of his companies
Continental Shares.
Today. Seiberling, Eaton and Davis
together probably control Goodyear.
VIII the next step be the taxing over
Of the Seiberling Co. by the Goodyear TO
bring this 71-year-old rubber genius |
back into the Goodyear picture?
There are many who believe this Is
the next move.
Aircraft Production.
The value of all aircraft production |
In the United States last Fall was $685. |
100000, as compared to 100000 in |
1923. While this is an increase of So
per cent, the aircraft industry was dis
appointed. To them, 1929 looked like
$125. 900 900 year!
Airmail use is growing rapidly. Off,
cial figures show 7,097.099 pounds of
mail were transported by air in 1929,
compared with 3,542o pounds in 1928
"a little less than 100 per cent in
crease in one year.
Since December most air lines have
cut their passenger rates vigorously, in
many cases to a point where they COM
pare favorably with railroad rates.
Now comes the announcement that
the retail cost Of airplanes is coming
down. The StinSon Aircraft Corpora
ton OF Wayne, Mich, introducing a
new series Of four-place cabin mono
planes, is cutting prices from around
$4,000 to s5.775. Other manufacturers
are following suit.
Sixty universities and colleges in the
United States. with 2.400 students en-
rolled, are today offering courses in
aeronautics, while 1861 active flying
students working last year for their
pilots license few 1860 hours in the
air without a single fatality or accident
OF major importance.
Reserve Bank Earnings.
Federal Reserve banks. since their or
ganization in 1914, have earned plenty
Of money. Net earnings have been
$515, 2l6, 900.
OF this amount, Just 500, 673, 900 went
back to the banks who owned all the
stock as dividends; 1927 $4,000 was
transferred TO surplus, and Sl47, 100 900
was paid to the Government as fran
chise tax.
The IL banks last year showed gross
earnings of S70,955 900, an increase of
5000, 900 above 1928. After expenses
were deducted, the net earnings were
Sal $4,000. or S4,116.000 higher than
they were the year preceding.
From present indications. the 1880
record will not be equal to that of 1929
because rediscount rates are so per cent
lower than they were year ago, while
the amount of rediscounting is much
less
For example, the week ending Feb
ruary IS. 1929 showed rediscounts with
the Federal Reserve of 1908 900 900.
Last week they we're but 1891, 100000.
But the Federal Reserve banks had
only SLIT 000, 600 of United States Gov
eminent securities last year, while last
week they had S473. 900, 900.
SO while rediscounts are much less,
open market purchases are much more.
This is the Federal Reserve story to
date.
(Copyright, 1880. by Nor'h American News
paper AlliaEce1