AMERICAN CONDITIONS.

New Zealand Herald, Volume LXVII, Issue 20474, 28 January 1930, Page 7

AMERICAN CONDITIONS.

CONTRACTION OF BUSINESS.

FORECAST OF EARLY RECOVERY.

Forecasting the trend of business conditions in the United Slates in 1930, the December issue of the Guaranty Survey says "a consensus qf opinion from authoritative sources seems to indicate a continued business recession during the early months of the year, some measure of recovery in the spring, and gradual improvement following, with fairly good results for the year as a whole. The closing year began well, but ended badly. The new year bids fair to reverse the process by beginning badly and ending well."

Tho survey states that out of the confusion which followed the reaction in the stock market, several important conclusions may be reached; first, that general business conditions have been less affected than was broadly feared; second, that the most important factor in the present business recession was over-production in important industries, from which a period of readjustment was inevitable. The movement of stocks registered an effect rather than a cause of this condition. Evidence of a varied character is quoted in the report to illustrate the decline in business activity "which has been under way for several-months, but has gained considerable momentum in tho last few weeks." It includes estimates that between 2,500,000 and 3,000,000 workers were unemployed in December.

"Vigorous measures have been taken by the Government to combat the downward tendency in business. Never before have public agencies interceded in such a direct and extensive way to alter the course of business, and the results are necessarily unpredictable. There is nn doubt, however, that the series of conferences with business executives emphasised tho strong position of tho country's leading industrial concerns and increased public confidence in their future. Out of these conferences has grown an organisation of business men which, it is hoped, will be able to exert a permanent stimulating and stabilising influence on business trends. "The decline in the total amount of credit employed in stock transactions has brought about a marked easing of money rates. This, in turn, has led to the withdrawal of more foreign funds and thus precipitated one of the most rapid outward gold movements ever experienced. Shipments for the last two months of the year reached a total of approximately £20,000,000. The movement, however, was fully expected and represents a natural consequence of the reduced demand for speculative credit. The opinion has been expressed that the movement will continue until an amount roughly equivalent to the previous accumulation —that is, between £40,000,000 and £6o,ooo,ooo—will have left this country; and it is believed by some authorities that as much as £80,000,000 could be spared without the slightest detriment to the domestic credit situation. If the redistribution of the metal continues at the rate that is generally expected, a period of perhaps six months should suffice to make its influence fully manifest.

VICTORIAN WHEAT CROP. ABOUT 18,000,000 BUSHELS. THE EXPORTABLE SURPLUS. Now that wheat crops generally have been harvested, and are being carted in, the Victorian Department of Agriculture has been able to obtain figures which have convinced the superintendent of agriculture, Mr. H. A. Mullett, that the department's earlier estimate ;of the State's yield—lß,ooo,ooo bushels—will be reached. If yields in the later districts prove reasonably good that figure may be exceeded. As the State's lequirements for seed, human consumption, and stock feed are normally about 12,000,000 bushels, there should be a surplus for export of at least 6,000,000 bushels. Earlier in the season it was thought, in some quarters, that there would be no exportable surplus this year. In most years between 20,000,000 and 30,000,000 bushels of wheat are exported. According to the Government Statist, however, the carry over from last year is about 5,000,000 bushels-, and the sale of these stocks during the present year will' increase materially the money which will be brought into the State from overseas. Mr. Mullett said recently that yields were in most cases exceeding earlier expectations. The enhanced yield could be attributed to the cool conditions under which the wheat had matured, although those conditions had exitended the ripening period. The recent rains, too, had delayed harvesting. Large numbers of samples were being received. These showed that almost all wheat harvested befQre the rains was of unusually good quality—surprisingly good, in fact, in view of the nature of the season —and tho milling quality should be very satisfactory. . A few samples contained green grains, a result of secondary growth caused by the late rains, and some, which had been harvested since the rains, were somewhat bleached. Estimates of the total crop at present must be regarded as tentative, as much depended upon the later districts, supplies in which the department's officers had had no opportunity of gauging with any degree of accuracy. Mr. Mullett said ho was satisfied, however, that the department's earlier estimate would be reached, and that there would be a surplus for export in the form of grain and flour.

THE A.M.P. SOCIETY. VOLUME OF YEAR'S BUSINESS. Mr. F. F. Mcßryde, manager for New Zealand of the Australian Mutual 110vidont Society, advises that the total now business completed for the year 1929 was £19,491.831, comprising £15,107,915 for the ordinary department, and £4,383,916 for the industrial department. Although the amount for the ordinary department shows a reduction, this is mainlv due to a very large local bodies' scheme of assurance completed in New South Wales in 1328, and the total is better than the average for the past five years. The industrial department shows a further record. The contribution of the New Zealand branch to tho above total was over £5,000,000, both departments in the Dominion creating fresh records.