Evening star., 1934-09-09
Trade Chiefs Disconnected,
but Not Very Worried
by Fluctuations.
EXPORT ADVANTAGE SEEN
IF $4.86 RATE RETURNS
Cheaper Sterling Expected to
Help Business in Case Ger
man Mark Collapses.
Special Dispatch to The Star.

NEW YORK, September 8.--Cables
and radio dispatches to Business
Week give the following survey OF
business abroad for the week end
ing today:
LONDON-"English executives have
been discommoded by the violent fluc-
tuationS of the pound during the last
week, but not seriously worried. For
some weeks business has known that
the Exchange Equalization Fund was
operating only in small way. and
that it was building up its reserves
ostensibly to meet any major crisis
which would follow any move by the
gold bloc toward devaluation. Coming
at time when Britain is normally
importing heavily and when there is
a larger than usual demand for
sterling exchange, new lows were reg
istered before the fund became opera
tive But at the first indication of
official support, spectators took their
cues and began to cover in sufficient
volume to push the pound back above
the SIS level in New York and near
the 77-franc level at which it has
stood for so long in Paris.
Afraid of Reich Crisis.
"In London, rumors from the Con-
tinent that Britain was deliberately
allowing the pound to drop to its old
parity are discounted only in part.
1t will be no surprise to the better
informed Englishman if the pound
gets back to the old $4.86 level soon
because of the advantage it would
give to Britain's export trade, which
has revived during the last year, but
which has not kept up with the prog
ress of most other business. England
still fears that even the determined
DR.. Schacht will not be able to keep
the German mark on the apparent"
gold standard, and that its collapse
will precipitate serious repercussions
in Europe. A pound, gradually cheap
ened, will be in better position to
meet a new crisis with the smallest
possible jolt to British business.
Although business remains quiet
owing to holiday influences, there are
still further signs recently of re-
awakening confidence. This conf
dence probably outleaps the actual
signs of improvement, although rail
traffic in a recent week were the best
since 1880 and the luxury and semi
luxury trades report bigger orders
than for some time past. It is still
difficult to survey with accuracy the
short-term trend of affairs at the
approach to the Autumn Winter sea-
son. Whether British home recovery
is off its recent plateau or not has
still to be proved. London expects a
squirt of activity in September and
October.
Industrial production in Britain
for the second quarter of 1884, ac-
cording to the weeks estimate of the
Board of Trade, shows that activity
has been or per cent gerater than in
preceding quarter and 14.1 per cent
greater than for the second quarter
of 1888. The index number is the
highest recorded since the March
quarter of 1880. In the manufacture
ing industries it is the highest since
1927"
Paris Outlook Clouded.
Business generally in
France is no better than it has been
for some months, and the outlook is
not bright. In the textile industry,
particularly the wooden section, there
is some improvement following the
easing of the restrictions on sales to
Germany. Counterbalancing this one
slightly favorable development is a
perceptible spreading of discomfort
among French farmers due to unsat-
iSfactory prices they are receiving for
wheat. Despite the fact the country
has smaller crop than a year ago,
1t is still large enough to meet do
mestic demand. Carryover from last
year, however, is sufficient to meet
nearly one-third of the country's
needs and is depressing the market.
Attempts by the government to main
tain wheat prices at artificial levels
have failed because discontented
farmers have underSold government
quotations. New efforts are going to
be made by the government to en-
courage feeding of grain to stock. to
expand exports and to enforce milling
regulations requiring large propor-
tlon of domestic grain.
Improvement on the bourSe, which
became evident more than a week ago
after prolonged period of inactivity,
has been short lived, due largely to
reactions to DR.. Schacht'S threatened
extension of the moratorium on Ger
man debts, to strike news from the
United States and to the further de-
preston of sterling. Paris interpre-
ted the weakness of sterling which
persisted until the British equali-
zation fund came actively to the res
cue as due not to speculation, but to
a loss of faith in the pound by GER
tain European countries and a few of
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