Evening star. [volume] (Washington, D.C.) 1854-1972, 1930-05-04
POOR FOREIGN CROP
MAY AID DROPPING
j. S. GRAIN MARKET
Drought in Argentina and
Australia Expected to A.
feet Current Yield.
CHEAP MONEY RESULTS
FROM LACK OF DEMAND
Industry and Securities Markets
Are Operating on Smaller
Cash Basis.
BY JOHN #. SINCLAIR.

Special Dispatch to The Star.
NEW YORK, May $40 say that
wheat authorities in both the United
States and Canada are doing some tall
thinking these days Is to utter truism.
May wheat dollar bushel in Chi
cago! Pretty bad, pretty badl But
maybe prices will change and the carry
over will save the situation, think some.
Let's take the Canadian situation
first. The Dominion Bureau of Stats
tics says that Canada will have a carry
over on August 1 Of 100000 bushels,
as against 104,000,000 bushels In 1929.
But this does not, as one observer
points out, take care Of the amount OF
Canada's wheat In storage in the United
States. This, II added. would increase
Canada's carryover from 100000 to
25,000,000 bushels. So to get it down
to 5000, 900, Canada must export be-
tween April / and July 81 at least as
much as she exported last year. Not
much encouragement in this!
U. 8. Figures.
What of the United States? The De-
partment Of Agriculture figures show
100000 bushels Of wheat available
in the country for export from April
to June 80 or for carryover.
"Unless the United States exports
much faster than q year ago, the supply
on hand July /, 1880, viii be greater
than that of last year, which approxi-
mated 240,000,000 bushels" says the
Wall Street Journal. Not q very rosy
picture, either.
OF course, between now and harvest
time, Argentina and Australia will be
pretty much out Of the market, so Eu-
rope is expected to turn to North Amer
lea for her supply.
But waitl Figures show that from
August l, 1929, to the end Of last week,
the world exports Of wheat were ASH
600, 900 bushels, against 697,000,000 o
year ago and 491 ,000, 900 two years ago.
Reading these figures, one might ex-
| pect wheat export to be smaller this
year than last year and the American
carry-over proportionately larger.
The one favorable factor from the
American and Canadian points of view,
| which are practically one, seems to DO
that Argentina and Australia, particu.
larly Argentina, will have poorer crops
this year because Of drought.
SO the disaster Of one nation may
turn out to be the good fortune of an
other-in wheat raising.
.- Cheap Money.
why is money so cheap now, when It
was 50 dear six months ago?" asks q
New York reader
While business had begun to lag be-
| fore the stock market break Of last Fail,
it was still going strong ana requiring
vast amounts Of credit to carry on its
work.
The stock and bond market, too, was
absorbing more and more credit, until
money rates rose to new high record,
since the panic Of 1872.
Neither Of these factors Is taking as
much credit as 1t did then by many bill
lions, Industrial depression Is world
wide. Business is slow. English buSi-
ness is feeling it, so is business in Italy,
France, Belgium and other countries, as
well as business in the United States.
So less money is needed now.
And the New York stock market Is
taking much less credit than 1t did
then to operate-somewhere between
$4,000, 000, 900 and $4,000, 900, 900.
Naturally money rates have moved
down as the demand for 1t has fallen
OF. For the seventh consecutive time in
Elk months the Bank Of England has cut
its discount rate. Six months ago the
rate was 61z per cent. Now it Is 8 per
cent.
Never has the conservative Bank Of
England moved its discount rate and
readjusted its credit lines so rapidly az
1t has during the last six months.
New York, too, has not been slow. It's
Federal Reserve Bank has reduced its
rate in the past six months four success
sive times-from 8 to 5 per cent.
French Money Power.
But the Bank Of France. In establish
ing its rate at 2h per cent-the lowest
In az years-gives new evidence Of the
growing money power Of Paris. That
story has not been written-the amax-
ing return In six years Of an almost
bankrupt people to great wealth and
prosperity. No other nation has come
back so fast, financially speaking. And
her story Is not yet ready to tell.
But while the discount rates in the
central banks do not always indicate
that the rates charged to bank CUSTOM
erS have dropped In the same degree,
they do show just now at least two
things: ID less active speculative
craze, and ca lessened world trade.
VIII lower money rates help? IN
doubtedly cheap money, available to the
man on the street, will help the bond
business, the mortgage loan field, build
ing and road construction and business
generally.
Particularly It viii be Of great help in
preparing the field for the new repara-
ton bond issue. Of which America Is
expected soon to absorb around $780,
100000.
Sugar Prices.
sugar prices have reached new low
levels. Willett g. Gray, authoritative
sugar statisticians since 1850, announce
that on Wednesday raws sold at $50
cents pound, while the July position In
the futures market dipped to 1883 cents
prices slightly below the levels reached
IN 1902, just % years ago.
Why Is sugar dropping? The free
marketing In sugar, which has been in
erect since the abolition Of the Cuban
single selling agency two or three weeks
ago. has doubtless been an important
contributing cause.
What we need right now, In my
opinion, instead Of two-score or more
refners, all competing and overlapping
each other, Is about four or I'VE strong,
well-organized ref1neries supplying the
Nation" said Rudolph Spreckles, In dis
cussing sugar prices the other day.
But this sweet" dream Is far from
realization, although such q move has
been under way for some time.
(Copyright. 1880, BY North American News
paper AHianee.)