SPECTACULAR FALL

Evening Post, Volume CXVI, Issue 19, 22 July 1933, Page 13

SPECTACULAR FALL

FINANCIAL PYRAMID

AUTHORITIES ANXIOUS

NEW YOBK, July 20,

Administration officials are watching with considerable apprehension developments in the commodity and securities markets, both of which suffered sharp reversals today, which are attributed partly to the top-heavy speculative situation, and partly to the somewhat irregular development of-the. industrial control programme and tho position of the dollar in international exchange. It is feared that the speculative fever may result in a debacle similar to tho 1929 crash.

The financial pyramid again tumbled in a spectacular fashion, commodities and stocks suffering price losses coinparablo only to the October, 1929, collapse. Stockß lost two to 18 points on a turnovor of 8,115,000 shares, the largest volume since May 5, 1930. Fifty of the principal stocks declined 6.49 points, comparable to the greatest single day's decline' in 1929. Tho 11.5 points decline in commodities is even more striking. Wheat lost up to 15$ cents, maize 12$ cents, oats 10 cents, rye 26 J cents, and cotton four dollars a bale.

The exception on the decline was the dollar, which recovered 18 cents to 4.64 against sterling. This is- due to the announcement of the plan in Britain to convert her 5J per cent, dollar loan of 1937 into sterling obligations at the rate of £260 for each 1000-dollar bond.

At tho direction of PresiiJbnt Roosevelt, the Secretary of Agriculture (Sir. Henry Wallace) moved to halve grain speculation by restoring tho regulation requiring that all long and short accounts of 500,000 bushels or more by the Chicago Board of Trado and other exchanges must be reported daily to the Grain-futures Administration.

Senator Thomas, commenting on the Administration's intent to curb speculation, indicated that a price-fluctuation limit and fair-practice- code for the stock exchange might bo demanded, as it concerns the industrial recovery scheme. i For- some time past it has been evident that the American people have not overcome their desire for speculation, and that, even though tho trading was at lower prices than occurred in 1929, some sort of reaction was likely. Trading figures give clear indication of this. At the beginning qt October, 1929, just before the historic1 crash, the moment when speculation was at its height, produced a week in which 19,140,280 shares were sold in a single week". Last month there was one week in which the number ,of shares traded totalled 19,925,090. In 1928 the same week had a total of 17,686,715. In 1927 the week's total was 8,972,491, or somewhat more than tho equivalent of what the above message announces to have been the total for one day's trading.