PRICES FAILING

Otago Daily Times, Issue 17944, 25 May 1920, Page 5

PRICES FAILING

GENERAL DECLINE PREDICTED. LANCASHIRE COTTON BOOM WItEA'fENED. Prese Asuocktion —By Telegraph—Copyright. LONDON, May 22. There is a wholesale fall in prices, beginning with foodstuffs and extending to clotlung, concurring with tho American slump. Many lines aro already cheaper. The newspapers tyro giving prominences to the fall in tho prices pf commodities following tiro slump in America. Some predict a further general decline and suggest that it is largely due to the action of the banks in restricting credits, but so far tho decline in most commodities Jias been very m6derate and the bankers' only effort has been to conserve resources for the use of traders, as distinct from speculators. The chief decline is in Egyptian cotton, which has fallen 9d per lb in a week, chiefly because the Egyptian banks have pressed their customers to reduce their loans, thus compelling numerous operators in Alexandria to sell. Another reason for tho fall is the favourable news regarding the prospect of the next cotton crop. As the cables havo already indicated, there has been a considerable fall in industrial metals. The fall in wool is less than in other commodities, and it is not considered likely that it will make a very appreciable change hi the cost of living at present, owing to forward orders having been booked at the highest rates. Food prices are showing only the usual declines, while there is a small chance of a cheapening of bread, sugar, and rice. Addressing the shareholders of the Fine Cotton Spinners' Association at Manchester, Sir Herbert Dixon (the chairman) likened the recent speculative activity in the recapitalisation of the spinning trade in Lancashire to t]je South Sea Bubble. He declared that the day of reckoning would come as surely a,s it did then. He held the view that a reduction of values was inevitable, leading to the enforced writing down of capital, with consequent serious loss to present buyers.—A. and N.Z. Cablo.

MOVEMENT TO ECONOMISE, RECORD SLUMP IN BOOTS. NO SIGN OF PERMANENT FALL. LONDON, May 24. (Received May 24, at 8.50 p.m.) , Whitsuntide holidays revealed a strong movement to economise. There were many fewer visits to the seaside than were expected, despite tho beautiful weather. The newspapers are eagerly dis-' cussing the fall in the prices of the necessaries of life, but there are no signs of a permanent fall. Indeed, bread and sugar aro likely to go higher, and rents are increasing. Nevertheless there is a record slump in boots in Northamptonshire, where the warehouses are so choked with supplies that a three days' working week js likely to come into operation. The clothing trade in Leeds is also depressed, and factories are no longer working at high pressure owing to the orders stopping suddenly. It is evidenk*hat many people are unable to buy at the present prices. The slump may mean the'discharge of many workers.—A. and N.Z. Cable.