Assorted historical stuff:
Sears-Roebuck fall/winter catalog to be mailed; over 1,100 pages, 46,000 items, more pages in color; will have average price cuts about 10%.
E.W. Beatty, pres. Canadian Pacific Rwy., advises curbing immigration from US and Europe to relieve unemployment.
Editorial: Farmers are complaining about tobacco taxes. However, acreage and prices paid have both been steadily increasing the past few years, suggesting the industry isn't exactly hurting. Also, the tax collected $450M [over 10% of total taxes] last year, which would have to be replaced. Sales taxes are fair because they tax proportional to use; “there can be no 'injustice' if the tax is reasonable in proportion to the value of the article.”
About $200M annually spent on industrial research by companies listed on the NYSE.
Front page of a San Francisco newspaper transmitted to Schenectady, NY by “telephoto.”
Daniel Guggenheim to support work of R.H. Goddard on designing rockets able to reach upper atmosphere.
New York City metropolitan area population 11.005M, up 2.395M from 1920.
Stocks advanced for a third day in a row for the first time since end of May. Bears attempted attack on major stocks in first hour, but volume immediately dried up after small declines. A powerful rally then started in major industrials, rails, and utilities. US Steel rallied in spite of lower unfilled orders; rails possibly helped by rise in freight rates. Banks, trusts, and insurance companies also higher. Active short covering came in to help fuel the rally; many highs hit in the last hour.
Investment trusts [similar to mutual funds] faced with some hard questions after being heavily invested before the market breaks both in October and June. Now developing “more thorough appreciation of the task of handling the large amounts of money entrusted to them” and realizing “the essentiality of constant study of conditions, general as well as particular.”
A subscriber suggests one cause of the current downturn may be a bubble in construction; level is 100%-150% above prewar vs. 50%-60% for general business.
Rumors of big bankers and industrial heads getting together to “relieve the people of the pessimism which now engulfs them.”
Rumors of “bull pools” being formed by “prominent operators” to bid up particular stocks including Standard Oil of New Jersey, and Vanadium.
During the depression, industrialists have been cutting costs and increasing efficiency. This will increase profit margins when the recovery comes.
F.H. Medart points out that depression years of 1921 and 1930 both added up to unlucky 13; therefore, after 1930 there should be clear sailing until 2029.
Economic news and individual company reports:
German economy suffering; unemployment up, exports expected to decline due to world depression. Continued deflation blamed on “the fact that international income and the investment of capital have lagged behind the increase in production.”
Japan discussing ways to build a domestic auto industry - may help lighten impact of London Naval Treaty on shipyards. Current Japanese auto market is almost insignificant; domestic production is about 400 cars/year.
Combined earnings for 20 major aviation companies in 1929 were $7.5M, but all of it was by United Aircraft [later became Boeing, United Technologies, and United Airlines]; remaining 19 companies had $800,000 loss. Earnings considerably worse so far in 1930.
Montgomery-Ward says that in spite of just announced price reductions profit margins are being maintained thanks to lower inventory prices paid. Also defends easy payment installment plan, says experience over many years has been “thoroughly satisfactory and our bad debt losses negligible.”
IBM reports June sales highest of any month in 1930; sales in May were record. Q1 earnings were 13% over 1929 Q1.
Ford of Germany sales for first half up 55% over 1929. Ford also building new plants in Milan, Italy and near Mexico City.
Who Cares, a revue by the Satirists, Inc. Numbers include “The Hunting Ballet,” in which a troupe of 12 “grinning and prancing” men impersonate ballet girls; “While good-naturedly funny, it [acknowledges] the excellence of the original.” Also “Thisishota,” a parody of Lysistrata, and “So This Is Television.”
+ The Boring Stuff: