SLUMP IN STOCK PRICES

Taranaki Daily News, 22 September 1931, Page 9

SLUMP IN STOCK PRICES

HEAVY FOREIGN SELLING GLOOMIEST DAY IN BRITAIN IMPROVEMENT AT CLOSE PLAN TO PROHIBIT LUXURY By Telegraph—Press Assn.—Copyright. London, Sept. 19. September 19 is likely to be known among members of the Stock Exchange as Black Saturday, for the first Saturday opening since March 21, 1917, witnessed the gloomiest conditions for many years. For the last few days the markets have been steadily falling and yesterday slumped badly, mainly as the result of selling from Amsterdam, Berlin, Paris, Brussels and New York, owing to financial troubles in those centres. The last straw came when the Brazilian Government announced that it was unable to purchase sufficient exchange to provide all the interest due on October 1 on its external debt. To-day there was further heavy selling from the Continent, with declines ranging from one to two points in war loan 5 per cents., conversion 3 J per cents., and the funding loan, but the markets became steadier and later closed above the worst. Australian stocks participated in the general collapse and, though there were only a few sales, prices wCfte lowered all round. A contributory factor to the weakness was the rumour of a proposed conversion of Commonwealth stocks here. Although most food and other commodities are selling cheaply, there has been one which has been steadily improving lately. The average prices recorded at the auctions at Mincing Lane for the last two months for all teas for the week ended July 16 were 9.46 d per pound, and on September 11, 14.19 d. The rise is apparently not unconnected with fears that duties would be imposed. Therefore the most cheering point in the situation is that they have hardened further since the Budget. Mr. Runciman’s proposal to prohibit the importation of luxuries is causing perturbation among wine traders, but the traders view the idea as ridiculous, for it is the duty upon wines which makes them appear to be luxuries. A well-known statistician, Sir Leo Chiozza Money, says that the suggestion ignores the fact that in August, 1931, Britain imported roundly as many manufactured articles as it exported. The imports included great groups of articles which Britain is particularly able to make, such as iron, bricks, artificial silk. Mr. Runciman would prohibit champagne. "I suggest it would be better to flood the streets of Sheffield with champagne than to flood our markets with imported pig iron,” he added.