Evening star. [volume] (Washington, D.C.) 1854-1972, 1931-07-03
HOOVER DEBT PLAN is HELD
MOVE FOR ECONOMIC PEACE
National City Bank Review Stresses Pres
ent Need for Normal Conditions In
Business Structure of the World.

ment made by the National City Bank
is the faith expressed IN Germany:
"Of the ultimate soundness and
strength of the German economy there
can be no doubt, but at this time the
country is dependent upon large
amounts of foreign short-term credits,
Withdrawals of which are a menace to
the country's gold reserves"
President Hoover's proposal does not
contemplate any moratorium upon pri-
vate debts, or even upon the loan of
300, 000, 900 Reichmarks which was dis
tributed in several markets under the
Young plan. 1t does not affect the
Dawes loan or any of the German state,
municipal or corporate loans sold in
foreign markets, the proceeds of which
have been received by the borrowers.
It relates wholly to intergovernmental
obligations, which differ from obliga-
tions sold on the public markets and
widely distributed to individual buyers.
There has been no agitation in Ger
many over any class Of obligations ex-
cepting the so-called political ones be-
tween governments.
General Conditions.
Commenting on general business con-
ditions, the National City Bank said
that the Presidents proposal already
has to its credit a remarkable re-
surgence of confidence and activity in
all markets and has meaSurably light
ened the strain of fear and unsettle-
ment under which business has been
laboring. What this relief may finally
lead to in tangible terms of trade,
through putting deferred projects into
execution, making long-term borrowing
easier and increasing purchases by I'LL
20 UthA ~
spend freely, remains to be demon
strated and will be affected by the
further course Of events.
Beginnings of commodity market i'm
provement had appeared even before
the Presidents announcement, prices
having made their lows in the forepart
of the month. Thereafter all the weekly
price index numbers turned upward,
some advancing for three consecutive
weeks.
The farmer will receive low prices for
his crops, but is producing them at the
lowest costs in many years, except in
parts of the Northwest, where drought
will raise costs by reducing yields
In the Southwest the wheat harvest
is already moving as far North as Kan
sas, and the largest yield per acre since
1915, with two exceptions, is assured.
1t is not unlikely, the bank says, that
the United States later on will be in a
preferred position in wheat with a good
crop here and substantial reductions
abroad. due to the serious drought in
Western Canada. decreased production
in the Danube Basin and expected de-
creases in acreage in the Southern
Hemisphere. The prospective Russian
export surplus still is an unknown
factor.
Trade and Industry.
Turning to the record of trade and
industry, the National City Bank finds
that the outstanding facts are that the
showing for May as reflected by the
composite adjusted indexes was less ia
vorable than preliminary estimates sug-
gestcd and that in June some of the i'm
portant industries reduced operations
by more than the usual seasonal
amount. It remains true that lines
serving personal needs are more active
than the heavy industries and the sat-
isfying response of the public to retail
offerings at low prices is the principal
encouraging feature of trade news.
The number of business failures fell
considerably last month, the total being
much less than for June, 1890. r. G..
Dun & Co., reported that failures to-
tailed 1898, involving $5l ,655. 648. COM
caring with 2,206 in June, 1890. for $685.
l33.762. The reduction from a wear ago
was the first in more than 10 months