Evening star. [volume] (Washington, D.C.) 1854-1972, 1930-07-03
PICKUP IS LIKELY
IN SALE OF BONDS
Every Indication Points to
Rising Market for This
Class of Securities.
BY JOHN F. SINCLAIR.

BY JOHN F. SINCLAIR.
The reduction yesterday Of the redis-
count rates of the Boston and Philadel-
phia Federal Reserve Banks to per
cent and 81 per cent, respectively
leaves seven Federal Reserve banks still
on the 4 per cent basis-San Francisco
Kansas City, st. Louis, Atlanta, Min
neapolis, Richmond and Dallss-and
three on a 3la per cent basis-Chicago,
Cleveland and Philadelphia; one on 9
3 per cent basis, Boston, and one, New
York, on a 21a per cent basis.
Cheap money is percolating back
through the channels of industry. 1t
must ultimately have its effect on bust
neSS-a salutary one at that.
Every indication points to a rising
bond market in the near future.
IF some one came in here and asked
you how to invest $l0,000,000 within a
week, what would you recommends"
asked an important official of the United
States Treasury Department
"Bonds-some United States Govern
ment bonds, some State bonds and some
public utility and railroad bonds" was
the reply
Idle money-huge gobs of it lying
around right now waiting for an oppor-
tunity-is going to be fovced into the
purchase of bonds in the next few
months, until the good cheap ones now
available are absorbed.
Six months should pretty we'll clean
the decks Of the bond dealers.
Frances threat of retaliation against
the new American tariff has been Laid
on the table" for the present And why?
Last year France bought about $685.
100000 of American goods, of which
more than third was cotton-$97,-
100000 worth.
If France decides to embark on a
policy of reprisal, where will she get
raw cotton? It's a question hard to
answer, for the whole world at the pres
ent time is getting its cheap cotton
from the United States.
Oil is the next most important French
import from the United States-about
% per cent of Frances total purchases.
France must buy her gasoline from out
side sources. Nearly all Europe i'm
ports oil. While Roumania and Rus
STA produce oil now-and Germany
may do so in the future, perhaps
that is not enough, and France needs
American oil and gasoline.
Copper is third on the list of French
imports from the United States, with
machinery fourth and American auto
mobiles fifth.
France can and already has cut down
American movie films, for which she
paid about 100000 in the last year
But this is a small item, relatively.
Besides American films are popular in
France, and it would work a hardship
nya 1an 1f,-yY 80 1s,4atv -
films entirely. American tourists in
France are still movie" fans, and
American films continue to lead the
world, certainly in form, If not always
in substance.
So If France does abolish the most
favored national treatment to the
United States, she will be taking
vengeance on herself by discriminating
against the three big American prod
uctS that she needs at the present
time-cotton, oil and copper.
On second thought, it looks as though
France will not do anything radical
Louis Guenther, New York financial
editor, after visit to the Orient, thinks
the return of Japan to a gold basis
was accomplished in too short time.
An economic depression of major inn
portance resulted. The business struc-
ture could not stand the strain. It's
one thing to take the gold basis on an
infiationary joy-ride, which every war
ing nation in the world did during the
war, but it's quite another thing to re-
store that same gold standard after the
debauch.
Nations, like England, have been at
1t for 10 years now and still are wres-
Ting with the task, with depression, I'M
employment and burdenSome taxation
as part of the annual cost.
Asked about the practice of japanese
employers in giving bonuses in lieu of
higher wages, Mr.. Guenther said:
THE practice resorted to by Japanese
industries of paying out bonuses to
their labor in lieu of higher wages was
successful so long as 1t was possible to
pay these bonuses. But when tie
bonuses ceased naturally trouble began,
and today Japan has a real problem in
this respect. Labor has become accus-
toned TO the bonus plan and it came to
consider the bonus as part of its regular
wages"
Ed Howe, the octogenarian Kansas
philosopher, takes issue with those who
think hard times are due to the lack Of
employment, low wages to those en-
ployed, depressed foreign trade, avarice
of the rich, lack of navigation on navi-
BaDlC ilfSIo, LllBu IdAIOdQ IdJeS, low
prices on farm products, etc. He passes
up all these with a wave of the hand
and jumps into the discussion.
IN make a guess, too. The trouble
Is the same old extravaganza, idleness
and Shiftlessness, all three greatly in
creased over 10 or 20 years ago." says
this Kansan. 1.-THE country is as good
as 1t ever was, but the people are not
behaving as well. The only hope for
betterment is for us to deserve more"
Too many people are trying to get by
without work and living on their wits.
When hard times do arrive, they "ra-
tionalize" their unfortunate position,
and thus add fuel TO the fire.
This Kansas writer thinks many of
the remedies suggested are as impossible
as the one Baron Munchausen, the
greatest liar Of history" tells about. 1t
seems the baron was crossing swollen
stream on horseback The horse was
sinking and the baron lifted the animal
to safety with his own legs and saved
himself by pulling upward the hair on
top of his own head
ITS been found that the actual diff
ference in hard times and good is not
more than 10 per cent" says Mr.. Howe.
81 cts exercise 10 Der cent more economy