Assorted historical stuff:
Japan is suffering a severe economic slump. “Early in May leading shares of the Tokyo Stock exchange ... hit the lowest level since May 1908.” Five small banks were forced to close in April, which may have worsened the panic. Exports in the first 4 months of 1930 dropped 24% from 1929. The government is being asked to help the unemployed with a program of public works.
The German Minister of labor forces more than 200,000 iron and steel workers to accept sharp wage cuts.
Unrest continues in India. The Simon commission counsels patience and gradualism. However, “it appears unlikely that the turbulent native elements” will be convinced.
Interesting interview with the later disgraced Richard Whitney about the stock market crash last fall. He praises the stock exchange machinery for bending but not breaking, particularly the Stock Clearing Corp. and the New York banks. Dismisses the effects of short selling on the crash. Counsels against intervention in markets even during panic conditions. “We must never fall into the fallacy of thinking that it is possible by closing the exchange or by taking other measures artificially limiting its operation to manipulate or juggle prices ... When liquidation in the stock markets becomes inevitable, the best course is to let it take its way and burn itself out as quickly as possible.”
New York city and state officials confer about unification of the Brooklyn Manhattan Transit Co. with the city's new subway system. More than 85% of the passengers on the 6th Ave El favor retaining it until it's replaced by a subway on 6th Ave.
Yet another editorial against the Smoot-Hawley Tariff hoping that Hoover and Mellon still have an open mind and arguing that the tariff will damage foreign trade, which we're dependent on since “we cannot hope to consume all we can produce.”
A more optimistic story on the tariff predicts that it will pass but says it's a much better bill than generally thought and the talk of foreign reprisals is exaggerated. Also predicts ending uncertainty about the tariff should benefit business.
Stocks continue down in morning but a strong rally develops in the afternoon. Rally is attributed to good news from steel, and the predicted passage of the tariff.
James C. Willson & Co. notes that for the first time since 1921, the dollar is fully backed by gold. Experience shows that when this happens a long and broad upswing in stock and commodity prices soon begins.
Shortselling has spread to some extent from professionals to “outsiders.”
Economic news and individual company reports:
US steel reported a decrease of 294,000 tons in unfilled orders for May. This was considered good news because it was below the average decrease for May in the previous seven years.
Value of automotive exports from the US during April was 44% below 1929.
Scott paper reports net income of 390,000 for the first five months of 1930 compared to 296,000 for 1929.
W.T. Grant (retail) reports an increase of 2% in sales at old stores compared to 1929.
Norfolk Southern railroad reports net income in the first four months of 1930, down 50% from 1929.
General Foods has acquired the Birdseye quick freezing process, which is predicted to lead to future growth.
Gillette safety razor company is marketing a new line of deluxe razors priced from $5 to $75 each. Blades made of “patented Kro-Man steel” to sell at 10 for $2.
“Her Father: Can you give my daughter the luxuries to which she has become accustomed?
Youth: Not much longer. That's why I want to get married.”
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