Evening star. [volume] (Washington, D.C.) 1854-1972, 1931-03-26
BY CHARLES F. sPEARE.
sneciaI Dispatcb tn The Star

Special Dispatch to The Star.
NEW YORK, March 26.-There are
two aspects of the situation brought
about by the Farm Boards announce
ment that the so-called sterilization
purchases of wheat will end with the
present crop-two viewpoints from
which it may be discussed. First, there
is the effect on the grain markets them
selves, and hence on the condition OF
the agricultural population, and, sec
ond, there is the probable influence OF
the announcement on the general eco
nomic outlook.
1t will be the wheat market which
will appraise the results under the first
head, and it will be the stock market
which will do the same for the second
question. Cotton and other farm prod
ucts are likely to move sympathetically
with wheat, particularly as cotton has
been the object, although to q much
less extent, of the Farm Boards buying
, operations.
Speculation at Low Point.
The important point, however, is to
realize that the immediate reaction in
any of these markets, including stocks,
is not necessarily the final Judgment.
Speculation in all these marts Is at
comparatively low ebb, and it may take
a considerable period before the exact
effect on prices may be seen.
It is also to be remembered that there
was nothing unexpected about the
boards decision. It was foregone con-
clusion that the experiment the United
States attempted in wheat would fail, as
surely as did that Of Great Britain in
rubber, of Brazil in coffee and Of Cuba
in sugar. The only doubt was as TO the
exact time when defeat would be ad-
mitted. The stock market has been con-
WINGED all along that the greatest OBJ
stacle 1t had to hurdle on the road to
recovery was this very situation which
has developed in wheat. To that extent
the news has been discounted.
Now, as to the grain prospect, one
thing has been gained and that is the
restoration of free market. Specula-
ton in wheat, hampered as 1t was by
half knowledge and half suspicion Of
the Farm Boards operations, has
dropped of to an alarming extent. That
situation at least will be corrected now.
Traders will be allowed, as far as the
new crop months are concerned, to ex-
press their views in quotations and so
make the market q help and not q
hindrance to those who have legitimate
business to transact therein.
Holdings Of Board.
There remain the huge holdings Of
wheat acquired by the Farm Board dur
ing its Inflated operations. Senator
Borah estimates these at somewhere be-
tween 10000 900 and 200, ZOO, 900 BUSH
els, but the exact figure is not known,
the Government refusing to make 1t
public. 1t Is true that this surplus will
still overhang the market, but it Is in
conceivable that the board should dis
pose Of it In any manner as would in
terrupt recovery, IL and when recovery
comes. It Is on record to that effect.
Meanwhile, the world situation is not
as hopeless as It seems. There Is an
enormous overproduction and there are
indications OF another large crop, not
only in the United States, but in other
producing countries. The Russian men,
ace remains and yet we are dealing with
an agricultural product dependent on
weather and all other vicissitudes to
which crops are subject The world
price today assumes the largest possible
production.
SFRR0 CCuRNFr wRvVown