GERMAN SPECULATION

Greymouth Evening Star, 16 May 1927, Page 7

GERMAN SPECULATION

“BLACK FRIDAY” LOSSES

(Australian & N.Z. Cable Assn.)

BERLIN, May 13.

The Stock Exchange to-day experienced one of its most disastrous days. An enormous slump in share values resulted in the loss of many huge private fortunes, while the shares of the Banks and the industries have suffered severely. Towards the close of the Bourse the big Banks intervened, thereby causing a slight rally, but this rally did not compensate for the day’s deficit. Glanzstoff (artificial silk) stocks dropped 150 points, and the Schultheiss Brewery shares 74 points. Thousands of foreigners have lost heavily. The Dyestuffs Trust has benefited, because it foresaw the slump. Thus it sold short, and it is now re-buying its own shares cheaply. The slump is attributed, among other causes, to the Bank of England’s action in maintaining its rate.

FALSE PROSPERITY

BERLIN, May 14.

One hundred millions sterling is the estimated loss to German wealth as the result of the Bourse collapse of "Black Friday” with its repercussion throughout the country. The Cabinet discussed the situation, when the opinion prevailed that the recent. Stock Market boom conveyed an impression of industrial prosperity which was non-existent. Criticism is levelled against the extravagant, spendthrift habits of a section of the community, as compared with the struggle for a livelihood on the part of the masses. The Cabinet has confirmed the fact that the Reichsbanks. foreign currency reserves are low, and has endorsed Herr Schacht's restriction of carryover credits.

In spite of official warnings, the public have been indulging in orgies of share-buying. When the news of Herr Schacht’s action leaked out, the public began throwing their shares on to the market in heaps. The tragic awakening was reflected last night in the form of empty theatres, cabarets, and restaurants.