Assorted historical stuff:
Some interesting observations on concentration of wealth by L.M. Shaw, Treasury Sec. under Pres. T. Roosevelt: “Whether fortunes of a hundred millions or more are good or bad matters not. It is as idle to rage at them, as to rave over them. ... As I read history each civilization has been self-destroying, and he who does not discern the larvae of destruction in this fails to see the obvious. ... instead of Huns and Vandals, our destroyers will be those of our own people who have had no breakfast and do not expect dinner.”
16 years ago today (July 31, 1914) the New York Stock Exchange closed due to outbreak of World War. NYSE President Noble rang opening gong at 10 AM, rang it again immediately for closing. Reopened for bond trading on Nov. 28, for stock trading Dec. 12; trading restrictions completely removed April 1, 1915.
Editorial: Some have seen the sweeping upset Conservative victory in Canada as response to the US tariff. But in fact, both sides advocated tariffs, the difference being that the Conservatives campaigned for one protecting Canada, whereas Liberals favored Beaverbrook's proposal for a tariff wall around the British Empire and free trade within it. Conservatives probably won because they put Canada first; Canadian public wanted “a party more dependably Canadian than imperial.”
Chicago police official tells congressional committee investigating Communist activities that US has a total of 51,685 members of Communist organizations and 79,325 in sympathetic groups. On the other side are 1,089,107 in organizations actively opposed to Soviet system.
Persistent reports in Canadian wheat circles of heavy rains ruining Russian and Baltic states wheat crop, threatening starvation. Reports can't be confirmed due to Soviet censorship of weather reports. These reports have not as yet been reflected in local wheat markets.
Better Business Bureau distributes booklet "What An Investor Should Know," primer for inexperienced investors to help detect fraud before money is lost.
Primo Carnera [boxer, 6'6", 280 pounds] currently traveling in US, having difficulty finding suitably large beds. Several hotels have procured special beds for him.
US Steel Q2 earnings were about the $3 expected, but finance committee issued optimistic statement expecting increased business through rest of year. Some disappointment extra dividend wasn't declared, though this had been predicted last week; the extra is considered likely later in year if business picks up.
Market opened firm; US Steel advanced early but was unable to hold gains; this discouraged bulls and was followed by profit-taking and aggressive bear pressure on leading industrials. Large declines followed in major industrials and trading favorites. Selling picked up in early afternoon on an unconfirmed report Ford might extend shutdown by another week. Some large buying by bullish interests in final hour; finish irregular. Banks, trusts sharply lower. First time in recent weeks that volume increased on decline.
Studebaker President A.R. Esrkine on the depression: Notes general pessimism, but buying power is still there; spending has gone down much more than incomes; “there are individuals in your territory who can and should buy a new or used car but have not done so. They have been hold outs, hoarding instead of spending normally and sensibly.” Recommends redoubled marketing efforts by businesses; Studebaker has done this through depressions for past 78 years.
Conservative observers more cautious, note profit-taking on rallies, difficulty getting prices to move up. Once again advise buying on reactions and selling rallies.
Editor: "I saw your paragraphs about Mr. Grace's salary in this morning's issue. Perhaps the world would be safe for democracy if it could be shown that a 'bonus system' of salaries for big executives would mean little or no bonus in a year when little or no earnings accrued to the common or garden variety of stockholders."
Currently, good stocks have dividend yields double the call money rate, reverse of the situation last year when call money rate was double dividend rate. This year's situation is unlikely to last, just as last year's didn't.
Economic news and individual company reports:
US electric output for past week was 1.660 GWHr, down 2% from 1929, an improvement over previous week's 3.3% decline.
Safeway Stores expects first half earnings about $2/share vs. $4.31 in 1929; sales are up 8.6%, but profit margins are down; consumers buying in bulk instead of "the higher grade commodity sold under trade names". Decline in purchase of "so-called luxury foodstuffs."
Axton Fisher, manufacturer of mentholated cigarettes under "Spud" brand, reports first half sales up 25%, earnings up 60%; stock yielding over 7%.
"He (bragging about ancestry) - Yes, my father sprang from a line of peers.
Bored Listener - Did he drown?"
[Get it? Peers ... piers ... ahh, never mind ... ]
+ The Boring Stuff: