IS IT THE REVIVAL?

Evening Post, Volume CXIV, Issue 63, 12 September 1932, Page 7

IS IT THE REVIVAL?

AWAITED FOR THREE YEARS

"BEAR" AND "BTLL" VIEWS

■United Press Association—By Electric Tele-

graph—Copyright.

LONDON, 10th September.

The questions uppermost in investors' minds are: Can the boom last? Is it the revival we have awaited for three long years? •* The Stock Exchange seems determined to emulate Wall Street acrobatics. Investors have ignored adverse factors like the continuance of the cotton dispute and the increase of unemployment. Even railroads have improved, while some issues have moved in accordance with best 1929 traditions like America Celanese, which had already spurted.over 100 per celit., and rose a. further 100 per cent: last week. Conservative city circles declare that the improvement is based on nothing more substantial than psychology. They consider that the impressive rise in the world prices of commodities like wheat, copper, tin, and rubber has been fostered by speculative interests. Traders were caught with attenuated supplies, for which reason a restocking movement again started which may reduce visible market stocks without involving increased absorption by ultimate consumers.

The reaction in New Xork under pressure of 500,000 bales of cotton indicates that the rise has already exceeded reasonable recovery, and "tends to reflect speculative possibilities in the remote future. ' .

SOLVENT OF CHEAP MONEY.

Bulls on the; contrary contend thaf cheap money, the historical solvent of a. depression, has only just begun to permeate trade. The Bank of England's statistical summary indicates that equilibrium of supply and demand has only recently been, reattainied. Filially the bulls argue that stock exchange se.ntiment should precede and not accompany trade fluctuations. The importance of restoration of investors ' morale cannot be overrated. | The removal of panic psychology is an essential precedent to recovery., The newspaper ">Economist" takes the cautious view that the bulls correctly diagonise the facts, while-others .rightly emphasise the dangers if international barriers are maintained, internal discrepancies and industrial costs are uncorrected, and long-term interest rates prove too low to restore a healthy demand for capital and goods. What is now required is a perceptible autumnal quickening of the tempo of industry, first ill the United States and subsequently in Europe.