August 16, 2009

Favorites of the week August 11-August 16, 1930

No Journal was published Sunday, August 17, 1930. Once again, a collection of my favorite items of the week. These aren't a representative selection but just the ones that made me smile or take notice.

August 16:

[Note: Insull was a pretty amazing compilation of the highs and lows of US capitalism. Among other things, he was: Thomas Edison's personal secretary; one of the founders of the company that became GE; reputedly one of the models for Citizen Kane; and, at this time, controller of a large number of utilities through a highly leveraged holding company that eventually collapsed, wiping out many people's savings.] S. Insull, Pres. Chicago Civic Opera Co., reports 1929 loss of $558,528 due to “constantly increasing cost of producing grand opera.”

[Note: Huh???] Leading economists say improvement in business will come through cuts in output eventually reducing inventories. However, output cuts do in turn cause further cut in consumption due to reduced purchasing power, and “the vicious circle continues until the point of minimum consumption is reached.” This then causes recovery as production is increased. Low production this year has been “working toward an ultimate cure of the overproduction situation.”

“It reminds us of the old wheeze about the American who was explaining to a British visitor the construction of an electric sign his concern was about to place on Broadway, New York. 'It will contain,' he said, '20,000 red lights, 17,000 blue lights, 10,000 white lights, and a central sunburst of orange and purple.' The Englishman was impressed. 'Most extraordinary,' he said. 'But don't you think, old chap, that it will be just a bit conspicuous?'

August 15:

[Note: What happened to the frickin' sharks with frickin' laser beams strapped to their heads? - Dr. Evil] Exterior of 50-story Irving Trust building at 1 Wall Street completed; required 288 rail cars of Indiana limestone. Vault extends 70 feet below building, protected by 6-foot building walls, outer layer of steel, thick layer of infusite (copper-iron alloy with “high torch-resisting qualities”), and layer of solid chemical “which, under the heat of a cracksman's torch, would give off paralyzing fumes.”

[Note: Strangely familiar dept.] Col. L. Ayres of Cleveland Trust sees almost certain economic improvement from July to August and September; based on historical patterns and comparisons to earlier depressions (1907-08, 1920-21). However, recovery does “not promise to be emphatic,” and some possibility of “attack of gloom” in business sentiment before the improvement becomes apparent.

[Note: Strangely familiar in reverse dept.] Detroit population April 1 was 1,573,985, increase of 580,307 since 1920.

[Note: Being a businessman was more civilized then dept.] Curtiss-Wright air shuttle to Saratoga races a great success. Flight leaves NY City at noon, returning after the last race in time for dinner. Business men “state this is the most ideal way to take in the races without losing an entire day's work.”

August 14:

[Note: Strangely familiar dept.] Editorial: J. Lonsdale, Pres. of bankers' association, says banking system held “firm, sound, and unmoved” during the market crash. The system did hold up well to the crisis, helping in many ways. Now, it may have a different duty. Bankers are naturally cautious and prefer “no” to “yes” - this was more than justified last year, but now some “yes”es may be called for; “If they feel that conditions are fundamentally sound, as they say they are, they have a duty to perform ... By constructive advice and concrete assistance they can do more to start wheels in motion and end unemployment than any arbitrary measures can do.”

[Note: That just might work dept.] Chile President approves prohibition law under which 6-time violaters will have pay docked 50% by employer and turned over to wife or family.

August 13:

[Note: This one is significant IMO. I had thought of the US dominance of world production and consumption as a consequence of WW2 destruction, but this would indicate it came much earlier. I also believe one of the more hopeful things now vs. 1930 is that there's more potential demand from the rest of the world.] US has 7% of world population, but consumes 69% of crude oil, 47% of copper, 56% of rubber, 48% of coffee [!], 21% of sugar, 35% of electric power. Produces 70% of oil, 60% of wheat and cotton, 50% of copper, 40% of coal. Holds about 50% of world's monetary gold, 2/3 of “total banking resources.”

Movement is growing to ban animal acts in France on grounds of cruelty; Jack London Club has already succeeded in banning then from British stage. French trainers reply that “animal training in France is achieved by kindness, and not, as in certain other continental countries, by brutalizing methods.” Regardless, animal acts have already declined in popularity from golden age 50 years ago, when they headlined many circus and vaudeville seasons. Great acts included Van Amburg, who literally made lion lie down with lamb; G.K. Bailey's hippopotamus in wheeled tank, advertised as “the blood-sweating Behemoth of holy writ”; two rival fake white elephants shown by Barnum and Forepaugh; and Bill the vaudeville bicycle-riding chimpanzee, who died last year just before his circus debut.

[Note: T'was ever thus dept.]Markets may come and go, up and down, but the crop of market letters remains as large as ever.”

[Note: Always keep your eye on the freight car loadings dept.] Rail car loadings for week ended Aug. 2 were 918,335 cars, down 1,014 from previous week, down 16.9% from 1929, and 12.4% from 1928.

August 12:

US oil production has been fortunate for whales; since a mature whale produces about 50 barrels of oil, 1929 US production of about 1B barrels would have consumed 20M whales. Whales should now be more secure barring return to fashion of the corset, with consequent demand for whalebone.

August 11:

Most sought after entertainers in Europe are black American musicians, particularly jazz. Fashion started during World War, after which many musicians stayed abroad, particularly in France and Germany. “The tourist may sigh for the stringed orchestras which once seemed an integral part of the gayety of Paris; but the proprietors of night clubs, restaurants, and music halls have heard the clink of coin that, like the ticking of a metronome, keeps time to the nimble feet of jazz.” German musicians have been so affected by the competition that the conservatory in Frankfort is now teaching jazz, though Berlin and Munich are still opposed. Paul Robeson appeared last winter in “staidest concert hall in Paris.” Theatre de la Porte Saint Martin, former home to Sarah Bernhardt, now playing black musical.

[Note: Strangely familiar dept.] E.B. Reeser, Pres. American Petroleum Inst., “adduces statistics to show that profits to oil companies have not been exorbitant.” Points to high level of investment required, says return on net worth for 1913-1925 only averaged 11.5%.

[Note: New economic index dept.] Production of women's stockings to decline about 4M dozen pairs from record output of 24M dozen in 1929; first decline since 1923. Production of knitted outerwear estimated down 15% in first half.

[Note: Buy some stocks that go up ... if they don't go up don't buy 'em dept.] Conservative observers continue to advise remaining on sidelines “until there is something definite to indicate that a decided change for the better has come.”

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