“CRASH” ON NEW YORK EXCHANGE.

Wanganui Herald, Volume LIII, Issue 16033, 26 January 1920, Page 6

“CRASH” ON NEW YORK EXCHANGE.

“SLUMP" FOLLOWS ERA OP WILD GAMBLING. SPECULATORS FACE BUHL Daily Chronicle’s Special Correspondent, NEW YORK, November 13. Vast fortunes—fortunes “on paper," which at on© time seemed to have all the glitter of solid wealth —fortunes which wer© built up in past months of reckless booming—were wiped out on the Stock Exchange in a few hours yesterday afternoon. Prom minute to minute, up to 200 minutes, amid scenes, of frenzy and anguish, the rates on call money were raised, and raised up to 30 per cent., while on time money rates rose and rose up to 14 per oent.—the highest since the panic of th© autumn of 1907. And there was little of either kind available.

Stocks fell several points between sales as the panic seized the “bulls," and they threw their holdings overboard.

Quotations in some of the “Industrials,” with which the market had been playing shuttlecock, crashed down 10, 20, 30, and—in the' case of General Motors— points.

SWIFTER THAN THE WIRES,

The “ticker” could not keep pace with the changes, but continued to record sales for 41 minutes after the gong had put an end to trading. Transactions for the day totalled 2,587,400 shares—the largest turnover since December 16, 1916, the time of the culmination of the German “peaoe kites,” designed to “dish” the Allies and keep America out of the war. General Motors, which led the decline, and which were quoted last week at 406’, opened at 3481, and sold down to 280.

American Tobacco dropped Association Oil dropped 35; Baldwin Locomotive dropped 21); Mexican Petroleum fell 33); and these were only preludes to or concomitants or other startling declines.

ON LABOUR,

The raising of money rates was the measure which was adopted by the Federal Eeserve Bank authorities to check the wild speculation that has been going on in stocks and commodities, and which is held largely responsible (as the New York World puts it) “for the popular discontent and the upsetting of all reason in Labour’s demands of hours and wages.” A conference of bankers was held here last evening, however, and considered ways and means for meeting the situation should it get out of hand.

COTTON. All this crash on the Stock Exchange was reflected on the Cotton Exchange, where the forced closing of speculative accounts resulted in prices falling so sharply that the “two hundred point,” or 10 dollars a bale limit—allowed under the rules—was reached some time before the closing hour, and trading virtually ceased. Foreign exchange rates also suffered. Demand sterling broke to a new low record of 4 dollars 10| cents to the pound; French francs sold at 9.50, and the Italian lire reached the unprecedented figure of 12.85.