PRICES SLUMP

Southland Times, Issue 22074, 22 July 1933, Page 5

PRICES SLUMP

SHARP DECLINES MARKETS IN AMERICA OFFICIAL APPREHENSION GRAIN TRADING STOPPED (United Press Assn.—Telegraph Copyright.) (Rec. 7.10 p.m.) New York, July 20. Administration officials are watching with considerable apprehension developments in the commodity and security markets, both of which suffered sharp reversals to-day. These were attributed partly to the top-heavy speculative situation and partly to the somewhat irregular development of the industrial control programme and the position of the dollar in international exchange. It is feared that speculative fever might result in a debacle similar to the 1929 crash.

A later report states that the financial pyramid again tumbled in spectacular fashion, commodities and stocks suffering price losses comparable only with the October, 1929, collapse. Stocks lost two to eighteen points on a turnover of 8,118,000 shares, the largest volume since May 5, 1930. Fifty of the principal stocks declined 6.49 points compared with the greatest single day’s decline in 1929 of 11.5 points. The decline in commodities was even more striking. Wheat lost up to 151cents, maize 12J, oats 10, rye 261, and cotton 4 dollars a bale. An exception on the decline was the dollar, which recovered 18 cents to 4.64 against sterling. This was due to the announcement of Britain’s plan to convert her 51 per cent, dollar loan of 1937 into sterling obligations at the rate of £260 for each 1000-dollar bond. Grain Prices Crash. Following a frenzied session in which grain prices took the worst hammering in history, the Chicago exchange directors and the Board of Trade tonight decided to suspend trading in grain and provision futures on Friday. . i The wheat exchange directors said the action was taken to permit the employees and brokerage houses much needed rest and “for no other reason. Officials said there was no word from Washington bearing on the , situation, and emphasized that the action was taken voluntarily. A message from Kansas City states that the directors of the Board of Trade decided to suspend trading m grain futures on Friday as an aftermath to the plunge of prices during trading to-day. There will be an indefinite restriction on price fluctuations. No restriction was placed on trading or price fluctuations at the Winnipeg Grain ' Exchange, according to a decision by the executive of the exchange to-night. It is believed that it would be unwise to adopt measures that would interfere with the market there. Administration’s Plans. President ' Roosevelt to-night approved in its entirety of a general voluntary ode governing minimum wages and shorter working hours for United States industry. A message from Washington states that Senator Thomas, commenting on the Administration’s intention to curb speculation, indicated that a price fluctuation limit and fair practice code for the Stock Exchange might be demanded as it concerned the industrial recover., scheme. At the direction of Mr Roosevelt the Secretary of Agriculture, Mr Wallace, moved to halve grain speculation by requiring that all long and short accounts of 500,000 bushels or more on the Chicago Board of Trade and ether exchanges must be reported daily to the Grain Futures Administration.

DOLLAR RECOVERS

PROBABLE CAUSES.

(United Press Assn—Telegraph Copyright.) (Rec. 7.40 p.m.) London, July 21. The financial editor of the Daily Telegraph says that Thursday’s striking recovery of the dollar is attributable partly to profit-taking by speculators who regarded the old parity as a milestone beyond which they believed the dollar would not travel far. To some extent the recovery may be due to American purchases here of 54 per cent, gold bonds.