Evening star., 1932-11-20
GERMANS REFUSE
TO LET POLITICS
IMPEDE BUSINESS
Security Prices Advancing
Steadily in Period After
Election.
INDUSTRIES CONTINUE
TO REGISTER ADVANCES
Additional Expansion in Activities
Reducing Jobless, but Cities
Face Financial Problem.
Special Dispatch to The Star.


NEW YORK, November 19-Cables
and wireless dispatches to the Business
Week give the following survey of busi-
ness abroad for the week ending today:
BerIin.-Whatever the attitude of the
rest of the world to the latest impasse
in German politics. Germans refuse to
let it interfere with business. Security
prices, most sensitive barometer of pub
lie reaction, have advanced steadily in
the post-election period. Industrial
activity continues to register gains, with
a resultant decline in the number of
jobless.
Financially, number of problems
were prominently in the news during
the week. Most encouraging was the
continued reports of the improved posi-
tion Of the Reichsbank. Quite dis
couraging was the news that the
Landesbank der Rheinprovinz, at Dus-
seldorf, had appealed to creditors in
Berlin for four-year postptonement
of its short-term debts (already over
due) and reduction of interest on these
obligations to per cent. The State OF
Prussia promises to guarantee interest
payments. so it is likely that creditors
Will agree to the proposal.
Emphasizes Problem.
The real significance of the whole
affair Is that 1t emphasizes the acute
financial problems facing German cities,
and the repercussions on the country
The Landesbank Is forced into the
present default because it loaned ex-
tensively to municipalities on long
term basis while many of its own debts
were short-term obligations. Last year,
the cash reserves were exhausted and
the bank has been unable to convert
them into long-term loans. Meanwhile,
cities have failed to meet obligations
to the bank and the present situation
has resulted. 1t Is recalled in financial
circles that Cologne. Frankfort and
Dortmund have defaulted on their out
standing obligations and that no amount
Of negotiating with creditors during the
Fail has brought any solution to the
problem.
More of the country's debt problems
came into the limelght when the Presi-
dent issued his most recent decree ex-
tending to all liens on real property
the mortgage moratorium largely con-
fined to farm mortgages. The new de-
cree includes mortgages to foreign
creditors-and extends the general
Commercially, signs of recovery con-
tinue to trickle into the Capital De-
partment stores in most cities report
that turnover is speeding up. The con-
tinuouS increase in carloading suggests
that foreign trade is holding up and
that recent industrial recovery is
spreading. Exports for October, as a
matter of fact, were up per cent and
the increase was spread fairly evenly
over all countries. Germans are inclined
to look on this as sign that trade re-
vival is developing in other countries
as well as in Germany.
Textiles Show Gain.
Textiles continue to be the brightest
spot in the industrial picture, with food
stuffs and other Immediately consumable
products moving faster and forcing high
er rates Of production. Iron and steel are
considerably more active in recent
weeks and further orders are in sight.
Paris.-With the exception of the
textile districts, where more and more
looms are going into activity, busi-
ness in France is in the doldrums this
week. Uncertainty is due to the pre-
carious position of the government dur
ing the debates on the budget, to the
doubt over Washington reaction to the
debt delay plea, tc government economy
measures which are anticipated, but,
naturally, not wanted when they mean
salary cuts for civil servants and to
worries over the declining price of
wheat.
There has been speculation over the
business prospect for Societe Europeene.
This organization has been formed by
French, German and British industries
backed by their respective banks to
undertake public works in their own
and other countries. Paris credits the
formation of the group to the Franco
German Economic Commission which set
out more than year ago to work out
a scheme whereby French finance and
German industry would cooperate for
their mutual benefit. In the present
set-up, participation is generally
thought to be 40 per cent French, 40
per cent British and 20 per cent Ger
man. The French are inclined to
expect big things from the group work.
ing together against powerful outside
groups.
London Prices Drop.
LONDON, November 10 opal
The chief feature of the week in Lon
don has been the recession in prices
in the list of gilt-edged securities,
which contrasts with the recovery
shown by this group at the end of the
previous week This market is a ma
tural barometer for recording the
changing phases of war debt senti-
ment, which began the week hopefully
and closed 1t extremely pessimistic.
In view of the unanimity OF cables
from the United States prophesying
that SO per cent of the membership OF
Congress would be against modification
of the debt agreements, opinion here,
though still clinging to the hope OF
bold initiative by Mr.. Roosevelt, tends
to accept resignedly the impossibtlity
of securing an early settlement in the
immediate future; hence interest now
is focused on the specific problem as to
whether it would be polite for Great
Britain to pay or default December 10.
This uncertainty, combined with the
political crisis in, Germany and the
questionable outlook for disarmament
and the immediate re-emergence OF the
Manchurian problem, have seriously
undermined confidence on the part OF
investors in the gilt-edge section. The
further course OF prices in the gilt
edge section depends more upon ex-
ternal events than upon internal tech
nical factors. which are not likely to be