Commercial Review

Hawke's Bay Tribune, Volume XV, Issue 193, 20 July 1925, Page 5

Commercial Review

The Week’s Features RUBBER AND GILT-EDGE STOCKS ■WILD SCENES ON ’CHANGE. (By Cable—Press Association—Copyright.) Loudon, July 18. The features of the Stock Exchange during the past week have been the rubber share boom, and the niarkeu strength of gilt-edged stocks the latter, of course, being responsible fo. the decision to issue the Common wealth’s loans forthwith. The rubber boom on Monday produced the wildest Stock Exchange scenes witnessed since the war, feverish buying being carried out without regaid to tue price or the values of particular shares. This wild orgy received a check on Wednesday, when in consequence of a sligin. reaction in the price of raw rubber, tens of thousands of shares were rushed on the market. These, however, were soon absorbed, and the marae. rallied. No real slump in these share* need be expected till the price of raw rubber drops considerably. Hitherto the Government has refused to interfere in the Stevenson production coirtrol scheme. Regarding the present fancy raw rubber prices these are merely a temporary phase, which will soon right itself. COMMONWEALTH LOAN. The departure in going to New York for threequarters ot the present kau requirements has occupied a conspicuous place in all linancai commentators’ writings, both in the daily papers and in the more considered judgments or t.cciw/luianciai reviews. i lie London

portion ot the loan was well received, and will meet the gilt-edged marke., which has steadily improved in the ptuc time wocks, unuer the influence of the Bank ot England’s gold position, and strong bank returns. Now that the Commonwealth’s arrangements have taken definite shape, the reasons and influences which havv brought about the decision to partially forsake the London market form u basis of innumerable newspaper articles upon London’s general position as a lender to the dominions ana coionics. WRITERS 1 COMMENTS. The tone of financial writers ’ comments upon this subject seems everywhere to vary in accordance with then views upon the wisdom or otherwise of the recent returns to the goia standard. The “Nation” for instance says: “The financial press does noi seem quite clear as to its attitude wards the Commonwealth’s decision to go to New York. Ou one side it Is argued that we have dangerously overlent, bad trade and over-high, consumption having reduced our capacity to lend abroad.” The “Statist," on the other hand, says: “It is urge*, that only by lending abroad can trad? be improved. There are many factors tending to check overlending, but th - effect of the trustee acts has been to enable the Colonial Governments, whatever their financial records or capacity, to raise money on almost as good terms as Great Britain. For our part it seems more important to know whether Australia has been overborrowing, than whether we have been overlending.”

GOLD STANDARD WELCOMED. Other writers emphasise that the return to the gold standard was decided upon with the dominions’ concurrence and support, and it was, probably recognised at the tune that it would necessarily entail the limiting of London’s external lending. The “Statist” welcomes, as a virtue of the gold standard, the fact that it ha> given clear indication how far the country is capable of lending abroad To the argument that the embargo on foreign investments and the necessity for the Commonwealth to go to New York proved that tin go.d standard had been inimical to th* country, the “Statist” replies that th countrv cannot lend more than it saves : that Great Britain at present is barel. making ends meet, and that conse quently the gold standard’s automatic check to over-leading should he wei coined. BRADFORD TRADE PROSPECTS. The results of the London woo sales, both Merino and crossbred in fused a better spirit into the rav material section of the Bradford trade but the developments at the manufar turing end have been more disappoint ing than was anticipated a week ago New business, in partially and fid’ manufactured goods, has not increr. ed to the extent expected when th sales opened, owing largely to th* wages dispute caused by the emp'oyers’ intimation of their intention to er force the five per cent', reduction r wages, and as the workers are deter mined to resist, a strike appears in evitable. From present indications in view of this possibility, neithc spinners nor manufacturers are any ous to buy till the outlook is clearer with the result that neither Londot nor Australian sales had much offer •on Bradford where the prices for top (have* not followed the lead set bv tin raw material.

DAIRY PRODUCE PRICES. The continuance of dry weather ha? had an effect of increasing the butte? and ch*eo* prices. It is noticeahh that Australian and New Zealand bn 4 ter continued to harden, despite th* slight weakening of Danish. The for mcr has advanced even since Thurs tlay. The arrivals from Australia an* New Zealand during June w r ere heart and there are large Quantities in cob' stores, hut in view of the expanded consumption and demand, it will al he needed. Trade forecasts are for firm prices, both for I "butter and chcesr lor some time to come. DRIED FRUITS, ETC. Tile canned mid dried fruits trades both have been the quietest, the lattei suffering a lull, following on the heart sales prior to the removal of the duty It is too early to say whether seller will ho enabled to maintain the pre eent prices.