Evening star., 1935-07-14
EQUITIES REFLECT
GROWING FAITH IN
BUSINESS OUTLOOK
Prices Hit New 1885 Peaks,
With Industrial Issues
Highest Since 1881.
WAGES ARE MAINTAINED,
BUT JOBS TOTAL LAGS
Between 5000, 900 and 10, 900 900
Still Idle-Lower Food Prices
Are Predicted.
BY CHARLES F. SPEARE.

Special Dispatch to The Star.
NEW YORK, July 13 (N.A.N.A)..
A Wall Street commentator remarked
this week that the gain in confidence
was due to the absence of new moves
to bring about imitation.
If this is a correct analysis, the fact
that the stock market touched a new
high average for the year, with in
dustrial shares at the best values since
the autumn Of 1881. gives point to the
argument that securities are today,
and have been for the last two years,
conforming more to business condi-
tions than to prospective currency ex-
pansion.
Wall Street woos the theory Of in
nation for a while; then drops it for
some more substantial reason for in
creasing its commitments in equities "
This may be found at present in the
current record of industrial activity
and in the increasing belief that busi-
ness will expand considerably in the
Fall.
In several lines that had been af-
fected by seasonal slump the come
back has been significant. Thus, iron
and steel production this week is at
$751; per cent Of capacity-still too
low for profitable operations, but
comparing with 81 per cent a year
ago. Fundamentally. the industry is
in better shape than last year, for
stocks are low, whereas they were high
in July. 1884.
Railroad equipment purchases are
the largest in several years. Electric
power output is 64 per cent over last
year, the highest since the eve of
the panic in October, 1929 This DEM
onstrates the degree to which the
industry has expanded during a six
year period when railroad traffic has
fallen 40 per cent and the average of
industrial activity is only about 70
per cent of normal
Automobile production during the
first week Of the month was nearly
double that Of the corresponding week
In 1894, though less than the last
week in June.
Gain in Bank Clearings.
Bank clearings for one week are Of
little use in charting business ac-
tivity. so the gain Of 30 per cent re-
ported in July may be dismissed in
favor Of the figures for the full month
of June. These show increases over
last year of from 8 to 49, per cent
in the IL Federal reserves districts
Of the country and the largest in
those sections whose trade expands
or contracts as the fortunes of the
producer of farm products are rising
or falling
Retail business has been above ex-
pectations In the Atlantic States, in
the Northwest and Southwest and in
portions of the Midwest, as well as on
the Pacific Coast. There is apparently
a stability in prices that satisfies the
consumer and an absence of the
threatened cutting and slashing that
followed the downfall of the N. r. A..
Wages are being maintained. There
are few labor disputes requiring i'm
mediate Federal attention. Unfortu-
nately, the absorption of labor into
employment is slow. In New York
State, factory employment dropped
IA per cent In June. There are still
between 5000, 900 and 10000, 900 seek
ing work in the country as a whole.
Figures of unemployment in Great
Britain, released this week, showed
the smallest total since July, $780,
The problem of the wheat crop this
year is what to do with it. The
forecast of the 1885 yield just made
by the Department of Agriculture IN
dicateS 731 ZOO, 900 bushels, compared
with less than 500,0OO,0OO bushels
last year. This is likely to be re-
duced before harvests, as rust and
floods are already cutting down the
prospects, but the surplus over re-
quirements will be heavy and in
competition with liberal harvests in
Canada and in Europe. The corn
crop is estimated at nearly 100000, 900
bushels more than in 1884, though 20
per cent under five-year average
Both of these conditions should bring
about more moderate prices of food
stuffs, which have advanced slightly
again this week.
Money Continues Abundant.
It is, then, this general condition
of improvement and of anticipated
business expansion that explains the
confidence expressed in the midweek
higher prices for securities. However,
the abundance of money and the con-
tinual quest for placement of it to
advantage is also an important fac
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