Evening star. [volume] (Washington, D.C.) 1854-1972, 1931-06-07
FOREIGN ECONOMIC
FIELD CLOUDED BY
PREPARATIONS ISSUE
Commodities and Securities
Weak-Exchanges Unsettled
as Month Opens.
ORNAMENTS CONTINUE
TO DOMINATE BUDGETS
Switzerland and Holland Declared
in Best Position on the
Continent.
Special Dispatch to The Star.

Special Dispatch to The Star.
NEW YORK, June 6-Cable dis
patches to the Business Week give the
following swift survey Of business abroad
for the week ending June 6:
EurOpe.-June opened with commod-
tiles weak, stock markets weaker and ex-
changes disorganized. The sag in Wall
Street ard American selling OF Euro
pean securities, continued concern over
the condition of Creditanstalt in Vienna,
expectations that the Niemeyer report
will recommend moratorium in Bra
zil-all contributed toward general I'M
settlement.
Further, the belief has become gen.
eral that the long latent reparations
problem is about to become once more
an immediate issue. Chancellor Bruen-
ing Is expected to contend at Chequers
that only a reduction of reparations, or
the alternative OF an AnschlusS with
Austria, or both. can avert an immi-
nent politico-economic crisis in Ger
many and danger of actual collapse Of
that country next Winter. Ultimately.
only the reduction Of present inflated
European armament cost will permit the
scaling down of international settle
ments unless the United States is ready
TO hold the bag.
Armament Expenses.
A recent survey by the Business
Week correspondents in Europe estab-
lished that not less than 26 per cent Of
the French 1882 budget will be devoted
to ornaments; in France and the little
entente combined, IS per cent of their
aggregate budgets: Italy, 81 per cent:
England, IS per cent; Germany, 6 per
cent.
If international political tension could
be eliminated, economic conditions would
not seem to justify particular pessimism.
Indications of seasonal recession in May
were fewer than usual. AS previously
pointed out in these cables, commodity
stocks, though congested are in first
hands. AS corollary, current manu-
featuring production appears to be
passing more rapidly to actual consump-
ton. Coal. ferrous metals and the en-
cheering industries are marking time
at low levels, but textiles Except cot
ton and jute), footwear and chemicals
are comparatively active. The building.
automotive and electrical equipment in
dustries are fairly we'll occupied. Even
shipping is somewhat improved.
" lCNlC" IHOIlll-TIlu
tons in individual countries. Switzer-
land and Holland are relatively in the
best position. British first-quarter in
dustrial production was quantitatively SO
per cent below the last quarter, 14.1
per cent below the same quarter last
year and, excepting the heavy indus
tries, cotton and textiles, May reports
were, on the average. fair.
Business in France Is characterized
by slow decline. Italy, though de-
pressed, has for some time resisted fur
ther loss of ground, and the stimulus ex-
pected by the oversubscrtption of the
$3.50, COT, 900 conversion loan marks the
first of a series of similar operations
pending in Europe.
London.-British business has failed
to show the usual post Whitsuntide
burst of activity. Stock markets are
weaker in tone. Foreign exchanges are
erratic, with the Spanish peseta lead
ing in the downward dip. American
money is plentiful for short-term loans,
evidently due to hasty withdrawal from
troubled money markets in Central
Europe.
Prospects for tin. already at a new
low. are not encouraging. Supplies
piled up in May. a fresh 1887 tons be-
ing added. June consumption Is not
expected to be large.
Rubber stocks, on the other hand, de-
clined for two successive weeks. called
UP a show of optimism until Offset by
news of increased shipments from
Malaga.
Paris Except for a further sharp
seasonal decline in the number of regis
tered unemployed (for the seventh con-
secutive week., general business con-
ditions are unimproved. Actually this
decrease in unemployment Is a freak
condition. for it is admitted that most
of the jobieSs have been absorbed only
temporarily by odd jobs in connection
with the Colonial Exposition.
Labor Trend.
more significant labor trend is fore
cast in the fresh complications which
have risen in the northern strike area.
The 10000 textile workers at Lille are
still out, and are strongly backed by
public opinion.
\ French finance is not running along
smoothly. The coming conversations at
Chequers between British and German
officials are stirring many worries.
RIGHTEOUSNESS is in a state Of ex-
IRENE nervouness. Current issues are
all in state Of suspense pending the
announcement of the governments
severe financial cure inathe shape of the
third emergency decree, due Saturday.
It is expected that, apart from drastic
curtailment of expenditure on social
services, the decree will bring an in
crease in the income tax despite pre-
viouS promises. A new wave Of capital
flight is feared.