COST OF LIVING.

Lyttelton Times, Volume CXVIII, Issue 18415, 22 May 1920, Page 7

COST OF LIVING.

FALLING PRICES IN AMERICA. MANUFACTURERS ALARMED. Bv Telegrach —Press Association-Copyright. " Australian and N.Z. Cable Association. NEW YORK, May 20. American manufacturers, realising the seriousness of retail price slamming, are now expressing their willingness to 00-operato with bankers to reduce the cost of living by 15 to 2o per cent. They anticipate that the pro-war standard" will never’return; that the cost of living will bo from a half to threequarters moro than before. . Tim newspapers, to-day, are crammed full of advertisements announcing a reduction varying from 20 to / 5 per cent in clothing, etc. LONDON ECONOMISING. PERIOD OF EXTRAVAGANCE ENDING. . United Service. (Received May 21. 7.35 p.m..) LONDON, May 20. London’s post-war period of extravagant luxury buying and enormous profits shows signs of ending. The vergo of the busiest season finds West End business men anxious to unload their heavy stocks, fearing the possibilities of the economy craze and consequent slump in buying The increasing dearness of money contributes to t:ho downward pressure. Managers of hotels, restaurants and shops indicate that high Bpending soon will bo confined to t he rich. Modistes declare that women in the highest social positions are cutting down their dress expenditure twothirds. AMERICAN PRICE SLUMP. OVER-SPECULATION THE CAUSE. fFIiOM Ouit CoiiRESPONUENT.I WELLINGTON, May 21. Opinions collected here from leading traders and a lady Recently re turnon from America suggest that tho. prico slump throughout the United States is the result of a panic due to over-spcc-ulation. As an instance of speculative buying in the United States drapery trade a lady who was interviewed stated that goods usually available for trade in November and December wero all absorbed by’ speculators in October last. When bona Hide traders went to buy they found almost everything they wanted taken by speculators, from whom they would have to buy, of course, at a high premium. It was undiluted gambling, not fair trading. Supply and demand wore a factor that could not be ignored, but manipulation, of markets by speculators had a great influence upon the prices of goods. It seemed anomalous, but .it was true, that manufacturers wero sometimes only too pleased to buy back their own goods from speculators at a high premium They had to buy goods made in America and shipped to London to meet American demands. Mr S. Kirkcaldie, principal of one of tho leading drapery and clothing establishments, corroborated this statement, declaring that goods often passed through the hands of half a dozen speculators. who nover saw them, and intruded their operations upon tho legitimate .circle of manufacturers, selling agent,(• jobber (or warehouseman) to retailer. • The textile and clothing trades had their speculators. It was evident from the cable messages that they were frantic to sell. They had been caught. It did not follow at all that there had been, a genuine fall in prices or that tho present collapse of the speculator heralded a general- reduction, on the contrary everything was against it. “We are advised from Manchester,” added Mr Kirkcaldie, “that raw cotton, which on March 7 was 16d per pound, advanced on March 16 to 29Jd per pound. Scottish wool-r lon manufacturers intimate that tlioy are already so booked up with orders that they cannot look at new business for 1921. Advices from Nottingham hosiery manufacturers are to the same effect. Tho whole world is short of clothing, and until that shortage is relieved there will be no moderation of prices. They may go higher. The British domestic demand itself is enormous and at present insatiable. There is a great insistent demand from the Continent, and during tho past few months from tho United -States also”