Evening star., 1933-06-25
Stocks Not as Responsive to
Bul|iSh Trade News After
Long Rise.
INDUSTRY MAINTAINS
RAPID IMPROVEMENT
Imitation on Top of Natural Ad.
vance Expected to Place Wage
Garner in Difficult Position.
BY CHARLES F. SPEARE

Special Dispatch TO The Star
NEW YORK, June 24.-It has been
made clear this week that the major
purpose of the Roosevelt administration
IS to raise the price level in the United
states and defer consideration of other
economic policies until this has been
accomplished
Consequently the dollar is now at the
greatest discount since the country
went on gold and there is less evidence
tnat staoillZation of the currency is to
be attempted or seriously discussed by
the American delegates to the London
Economic Conference.
Ihe American delegation has been
spnt apart by the contradictory views
OF ITS members, the one internationally
inclined and the other strongly ccms
mltted to natioealist policy.
In thls atmosphere of doubt and dis
agreement the markets have pursued
an uneven course. Because they have
had such a substantial rise in the las.
three months they are not so responsive
70 oullish news as they were There
also is growing doubt as to the abil-
lty OF the administration successfullv
10 carry on recovery program that
involve so many new policies and must
De handled with such delicacy.
Await Imitation Moves.
Outwardly markets have been i'm
PEELED by the expectancy of imitation.
Actually there has been little done to
promote imitation. The Federal Re-
serve purchases of Government secrlri-
ties have been comparatively small.
Inc machinery of the various infia-
tlon acts has not been set in motion.
nor Will it be for some weeks. Securi-
ties. commodities and trade have been
taking care Of themselves, responding
to natural conditions
II Is not accurate to presume that
those who are buying securities are
impelled wholly by the imitation mo-
tive They believe that the natural
recovery in business conditions makes
many common stocks and Junior bonds
reasonably safe as invastments.~ uw'itffs
the promise of dividends resumed and
interest fully earned. Commodities that
nave declined in price below the cost
OF production are likewise regarded as
desirable, especially if measures are
adopted to maintain a more perfect
balance between output and consump-
ton. The logical sequel Of dehation
is a period of price advances that may
be too rapid and too extreme in rela-
tio.t to recovery. This always has oc-
IL.
Despite these facts there is every in.
dication that the legal forces of infla-
ton are to be set in motion and that
1t Is the Intention of this country to
promote rather violent rise in the
price level. The burden will be car
rled by wage earners and those de-
pendent on small incomes, for costs
will rise faster and further than COM
pensation for labor or for services.
Trade Picture Brightens,
Iron and steel production has reached
the so per cent level, being higher
than since April, 1881. Output of cleo
trio power is greater than it has been
since January, 1882, and within per
cent of the total of two years ago. Car
loadings in the third week of this
month were nearly IA per cent over
those year ago. Outside of New
York, where they are affected by the
huge turnover on the Stock Exchange,
bank clearings are in excess of June,
1882
Retail prices have advanced after a
four-year decline. The department
stores are making the best showing in
months. Even the long stagnant build
ing industry is beginning to show signs
OF life. The Department of Labor esti-
AAo1So eAioI A'oVo,ooU PCISOllS nave D6eIl
re-employed since the end of April.
With the years wheat crop likely
to be the smallest since the early COS,
the question of the existing supply is
not SO important. 1t will be difficult,
however, to control production if this
shortage and imitation methods force
the price above dollar busheI
Clearing up the debris after the bank
holiday is a SLOW and unsatisfactory
process. There still are about 5000
banks either closed or under restric-
tions.
No closed bank is so badly off that
it could not disburse at least 10 per
cent to its creditors. Yet there are
hundreds whose quick assets with a
good market represent so per cent Of
deposits, that have not paid out q
penny.
The controller of the currency and
every State banking superintendent has
the power to compel the conservators
or receivers of banks under their ju-
risdiction to declare prompt dividends
to deposltors. This they should do.
Copyright, 1880