President Hoover issues statement on the tariff bill; intends to sign it. Criticizes congressional control of tariffs, saying it is “always tainted with lobbying and logrolling.” Says tariffs should be set by an impartial panel of experts under presidential control. States that he intends to use the tariff commission to correct the problems with the bill. Says that foreign protests against the bill can be remedied by application to the commission.
Federal, state, and city construction work shows a steady increase under the current expansion program.
Miami's population grows from 29,571 in 1920 to 110,025 in 1930.
Argentina and Germany begin new radio service capable of transmitting photographs and documents.
Canadian government announces a program to develop the Alberta tar sands. Applicants must have the rights to a promising process for mining the oil sands. After receiving a permit experimental work must begin within 60 days and at least $15,000 must be spent within the first year.
Group of leading businessmen and sugar plantations in Hawaii form a $2.25 million company to recycle sugarcane waste (bagasse) into insulating wallboard.
April Canadian power output totaled 1645 GWH, compared to 1400 in 1929. Almost all of it was hydroelectric.
Rear Admiral Richard E. Byrd is returning this week from his Antarctic expedition; will address the Bond Club of New York at a special luncheon June 26.
Sharp decline in the market with active stocks hitting new lows. Blamed on severe declines in commodity prices(wheat, cotton), followed by aggressive drives by bearish professionals. Many stop loss orders triggered. Severe declines in major industrials including US Steel, American Can, GE, Westinghouse, also in major utilities. Brief rally around two o'clock, but renewed pressure in the last hour. Two stocks made new yearly highs; 306 made new yearly lows.
Many leading companies have given back most of their gains off the 1929 panic low. Of 13 major companies only IT&T is below the 1929 low at 41 3/8, although US Steel, Union Carbide, and AT&T were close.
Many dividend paying stocks have declined to the point where their yields are quite high (over 5%) - the dividends seem to be considered unsafe due to falling earnings, even where the company has built up a substantial cash surplus on the balance sheet.
Assorted rumors going around concerning the level of short interest, what investment trusts are doing, and that “something is hanging over the market.” Rumors are generally unconfirmed, but Wall Street “is always willing to explain a sharp break, and at such times rumors fly thick and fast, being magnified as they are passed around the financial district.”
Economists predict it's unlikely that commodity prices will recover soon, but also say further declines are unlikely because prices are already at “abnormally low levels.”
Hoover's announcement on tariff favorably received due to removal of business uncertainty, and his announced intention to use his authority via the tariff commission to fix problems with the law.
Bearish professionals singled out high Price/Earnings stocks for attack, but were unsuccessful with National Biscuit. Supporters pointed out the stock has historically sold for 25 to 30 times earnings, and is benefiting from reduced commodity prices.
Harvard Economics Society says the recent market weakness reflects pessimism and uncertainty, but sees no change in the fundamentals, forecasts “an early improvement in business.”
Economic news and individual company reports:
Merchandise imports and exports in May hit a new low level for the year, reaching the lowest level since 1924. Surplus in May was $37 million compared to $24 million in April.
American Can (containers for canned foods) reports sales so far this year have been as good as 1929; earnings are slightly behind 1929 but for the full year may be a little better.
Elgin Watch reports profit for the four months April 30 down 50% from 1929.
American Airways announces an increase in air passenger rates to 7 cents a mile. Previously had reduced fares from 10 and 11 cents a mile to 5 1/2 cents in January. This resulted in increases of 300-400% in passengers carried, but even at full capacity this level of fares caused the company to operate at a severe loss.
US tobacco (snuff and smoking tobacco) reports business this year up to the record level of last year; net profit for the full-year is likely to exceed last year. Company has shown a gain in earnings every year since 1914.
Phillips Petroleum reports earnings for the first five months of 1930 up 16% over 1929, earnings for May up 44%.
Recent crude oil production numbers: California 603 thousand barrels a day, Venezuela 352,000 barrels a day.
Adam Opel (German auto) has dismissed 30% of its employees, leaving 5500 at the end of June.
“He – Do you smoke? She – No, I don't smoke. He – Do you drink? She – No, I don't drink. He – Do you neck? She – No, I don't neck. He – Well, what do you do? She – I tell lies.”