Evening star., 1939-08-29
Commodity Changes
Al Start Of World
War Recalled
Troders Review Trends
-
For Clue to Present
Possibilities
~ the Associated Press,

~ the Associated Press.
NEW YORK, Aug. 2e.-What
course will commodity prices take If
war breaks out in Europe?
Traders today looked back to
World War experiences for clues.
On July as, three days before the
first declaration OF war in 1914, cash
wheat (No. red was selling at
84iz to 851a cents a bushel. BY
August 7, 1914, when most European
powers were involved In the con-
flict, wheat was 88 to 90 cents. BY
December 81, 1914. = little less than
five months after the war started,
wheat had skyrocketed to $1.26h
to $128A.
Other commodities reacted aS fol-
lows leash pricex):
Corn 'Gls Isis. T. Alsi isi4. !. pts fsiS. e.
sush.l .7s*-.u .s1n-.ss .ss-.ssm
s.:s T.. ou. q Gao. '1'is; ys5; i5}is i5}:issSs
Cottonseed
oos.. n OoSRd ,R,a s.'s-s4s s.So.si. s.ss 0oe
,y::. 8 :! ssaas y, s'sss "a: 4ssss 4'sass ~:
Cocoa ,accra)
Rubber at New York in July, 1914.
averaged 5sIs cents 4 pound, in Au-
gust OF that year, 68 cents, and In
December, 81 cents.
Hides at Chicago averaged 1910
cents . pound in July, 1914; 1875
cents in August, and 218s cents in
December.
Affected Three Ways.
Wars affect commodity prices
chiefly in three ways" the Com
modify Research Bureau says.
First, they disrupt transportation,
stopping back the movement of GER
tain commodities and 30 depressing
the price; in nations which are
forced to import these commodities
the transportation difaculty becomes
. price-strengthening influence.
Second, war diverts man power
from production to destruction
causing shortages OF essentials and
consequent high prices.
Third, war leads to currency and
credit abuses, as the warning DOW
ers. putting self Representation above
orthodox money policies, try to keep
armies in the field and to meet the
shortages Of commodities and labor
the reluctance of taxpayers and the
hscal needs Of the government. by
supposedly temporary fiscal expe-
dents
There were three distinct stages
In the influence OF the World War
on commodity prices, and commod-
ity prices responded with three diff
ferent patterns. the bureau noted,
adding:
The hrst stage was In 1914, when
the initial shock of war sent some
commodities up and others down.
Second Stage In 1918.
THE second stage began at the
end of 1918 and was intensified when
the United States entered the war
and q general upsurge of basic COM
modify prices was stopped by Gov
ernment interference in the COM
modify boom and the esta blishment
OF price control through the War
Industries Board and the food, sugar
and other administrations over all
military necessities Price control
OF an even more rigid. though not
everywhere as successful a nature.
was instituted by every leading con-
testant.
"The third stage came when the
warning governments, shortly after
the armistice, took off their price
controls. There was brief period
Of skyrocketing prices, lasting from
six months to year, as spectators
and previously 'non-essential' indus
tries reached for the commodities
they had been cut off from during
the war. And this turned into the
price debacle of 1920-l92l."
Prices in 1920-l92l, after zooming
steeply upward, tumbled perpendic-
ularly.