Assorted historical stuff:
A.M. Creighton, manufacturer and banker, returns from a 32,000 mile tour of the Pacific begun from San Francisco in January. Stops included Bali, Java, Australia, Singapore, Bangkok, Indochina, China, Japan, and Hawaii. Found conditions everywhere depressed, particularly in commodity producing countries due to price declines, overcapacity, and fall in silver. Tariff is causing uneasiness. Found American cars, music, and movies everywhere. Many places had live interpreters of sound movies into the native tongue.
Experimental showing of sound movie on a moving train by the Chicago, St. Paul Railway. Experiment successful but some refinements are needed before movies become a regular part of railroad travel.
Contracts awarded for brick to be used for the new Waldorf Astoria Hotel on Park Avenue. Approximately 3 million face bricks custom designed to match Indiana limestone, and 8 million ordinary bricks.
Col. Ayres, VP Cleveland Trust, predicts an abrupt recovery in stock and commodity prices by Labor Day due to current consumption exceeding production. Distinguishes between two types of depression, “V”-shaped and “U”-shaped.
Reduction of the rediscount rate to 2 1/2 percent is considered beneficial in several ways. It indicates credit will be easy for some time; should benefit many industries including farming, building, and construction, and make bond issues easier for corporations resulting in lower unemployment.
Stocks continued down, with big declines in the large trading stocks. Bears encouraged by the failure to hold Thursday's rally after good news, and further breaks in the commodity market (wheat, corn, cotton). US Steel hit a new yearly low, followed shortly by Bethlehem Steel, Union Carbide, and American Can. Some rallying on the close on short covering. Volume not very heavy.
Commerce Secretary Lamont denies tariff will hurt trade. Notes that 80% of imports are duty-free or will have duty reduced or unchanged under the new tariff. Says flexible clause of tariff can be used to address remaining complaints of foreign countries. Notes that trade has increased for many years in spite of previous tariff increases. Treasury Secretary Mellon also has defended the tariff, and being the third richest man in the world he would certainly be opposed to it if he thought it was damaging to business.
Economic news and individual company reports:
US merchandise exports in May fell to $322 million, lowest for any month since July 1924. Imports fell to $285M, lowest since August 1924. Attributed to general decline in business and commodity deflation.
Metro-Goldwyn-Mayer production plans for upcoming year include 50 feature films, 60 comedy/novelty shorts, and 104 Hearst Metrotone newsreels.
Ford Motor Company has found it's practical to salvage materials from antiquated cars; currently has 120 men dismantling the old cars at a rate of 375 every 16 hours, plans to expand the operation.
Goldman Sachs continues to hit new record lows, now selling at less than one sixth its 1929 high.
Growers and packers are uniting to try and cope with a large oversupply of cling peaches. Number of cases has increased from 1.5 million in 1910 to almost 15 million in 1928. Similar glut conditions in the raisin grape industry.
Heard on the Street:
“'Things are getting back to normal,' remarked the head of a Broadway house. 'Again the main topic of discussion among our customers is the 18th amendment.'” [Prohibition]
+ The Boring Stuff