Evening star., 1932-08-07
REICH REASSURED
AS ELECTIONS PASS
WITHOUT A CRISIS
Continuance of Won Papen
Ministry Accepted BulIiSh-
Iy by Business.
FRANCE CONTINUES LOSS
OF GOLD STORES ON HAND
General Tone in Great Britain Re-
mains Cheerful Despite Lull
in Activities.
Special Dispatch to The Star.

Special Dispatch to The Star.
NEW YORK, August 6.-Cables and
wireless dispatches to The Business
Week give the following survey of busi-
ness abroad for the week ending:
RERLIN-Germany, and all Europe,
is relieved that the tensely awaited
Reichstag elections are over. While
the results are indecisive. inasmuch as
no party or natural coalition of parties.
received a majority, the quietness with
which the results have been accepted
in the Reich indicate that no major
crisis is likely in the near future.
Whether or not business wholly ap-
proves of Won Papen, the prospect that
the present cabinet will carry on is ac-
cepted bullishly. Unless the Hitlerites
should attempt coup d etat which
seems increasingly unlikely, the threat
Of chaos has passed.
Boerse Remains Firm.
The Boerse remained firm through
out the week. While bond sales were
not large, prices we're firm. Stocks re-
acted slightly over the week end, soon
recovered.
The report of the Reich Bank at the
CAAO u OGlJs HllAIll o1lONCu IlldL kOlu
holdings had increased slightly, was
favorably received. Inasmuch as ma
turing bonds are not being paid, it is
not likely that there will be any i'm
mediate heavy drain on gold reserves.
Industry is definitely under the in
fluence of the Summer lull. The
building trades are operating at barely
Is per cent of capacity. Cotton spin
ming shows no improvement despite the
! general agreement to curtail produc-
ton to so per cent of capacity Rayon
and cotton cloth, and the wooden di-
vision Of the textile industry have
shown moderate improvement recently.
The steel industry is operating at 20
for more Soviet orders now that banks
are considering a new extension of
credits on this business.
Despite the statistical evidence to the
contrary, sentiment generally is more
optimistic than few weeks ago. Con-
structive developments are expected in
the next few months which viii con-
siderably improve Germany's economic
prospects.
Dollar Advances.
PARIS-For the second week in Sue
ceSsion the Bank of France has lost
gold. After falling away sharply at the
end of last week. dollar exchange has
again mounted sharply. has momen-
tarily touched the theoretical gold eX-
port point. To French business, these
Developments were as significant as
any this week.
The rise of dollar exchange is at
tributed to % the upward movement
of prices and investment activity in
Wall Street, with resulting rush Of
French buying, and to (2) returning
confidence in the solidity of the dollar,
despite 1ndationary developments in the
United States and in part. at least, due
to budgetary weakness in France Execu-
tives look for no flight to the dollar"
though they confidently expect that
there will be some re-eXportS of French
gold early this Fall.
Activity on the Bourse expanded as
the interest in Wall Street spread. Not
even the bank holiday in London re-
tarded the interest in foreign shares.
German election results had been dis
counted in advance, but the market well
coined the reinsurance. France looks
for Won Papen to remain in control
of the government in Germany. France
is fully aware of his friendly gestures
since he has been at the head of the
Reich. Franco-German cooperation is
expected to develop further during the
coming months.
London Tone Cheerful.
LONDON-There was no outstanding
feature of the business week in Great
Britain. The tone remains cheerful.
The number of inquiries is much more
encouraging than the number of orders,
though few industries such as rayon
are doing a good business. The CONVEX
sion operation is progressing favorably.
. The fall in the exchange rate Of
sterling, while discouraging interna-
tional investors, is beneficial to the ex-
port industries. London credits the re-
cent decline in the pound to the rush
of investment money to Wall Street and
to the fact that there is almost no Off
ciaI support. There is no anxiety that
It will continue to fall for any length
of time. 1t is pointed out that the
franc also sagged on heavy French
buying in New York investment
markets
Firmness of stocks and bonds despite
the holiday lull and the depreciation
of sterling is interpreted as a sign that
distrust of the future is disappearing.
Confidence in the country's credit struc-
ture is developing.