Assorted historical stuff:
Editorial by T. Woodlock: Farm problem is not one of traditional farms that work year-round and raise most of their own food, but of the modern “money-croppers” who put all their land into single crops they must sell in markets they have no control over.
AFL Pres. Green predicts serious winter, economic distress in all big cities; calls on city authorities, business and labor groups to prepare to relieve distress.
Dr. M. Winkler of Bertron, Griscom, & Co. calls for US to use its “still enormous reservoir of credit” to help South America recover, pointing to “fountain of credit” that was extended for 8 years, only to “suddenly and without warning” dry up due to the depression.
White House is maintained by staff of 77, at cost of about $135,000 last year; cost of furniture was $5,000, coal $3,575, electricity $215.
Pres. Hoover reported in excellent heath by his doctor; weight stable at 188 pounds, contrary to rumors of recent 15 pound loss.
Dr. Y. Henderson, Prof. of Applied Physiology at Yale, says beer and ale with 4% alcohol content not intoxicating from scientific standpoint.
Device for muffling airplane engine noise invented by Miss Eldorado Jones successfully tested at Roosevelt Field.
Telephone operators in Paris start using new innovation: callers are switched to “phonograph-like disc” repeating appropriate messages such as “that line is busy.”
Market wrap: Stocks opened strong; bulls encouraged by large short position and increases in imports and rail freight loadings. Rally paused at the end of first hour on bad steel news, but was resumed in “vigorous style” about noon. Short covering grew more urgent as rally progressed; recently oversold stocks including Westinghouse and rails were up sharply. Bears made some afternoon efforts, but volume slackened on declines and market maintained good tone. Bond market higher; sharp rally in foreign govts., led by Brazil; US govt. very quiet, steady; corp. bonds rallied, including convertibles and second grade.
Broad Street Gossip: “A real bullish development is the ability of people to forget. The hardest thing to forget was the 1929 smash. More talk about the recent drop is now heard than about the November, 1929 decline.”
T. Callaway, Invest. Bankers Assoc. Pres. gives keynote address at convention: business doesn't need artificial respiration; wealth producing power of country hasn't been essentially hurt; industrial management and equipment have never been more efficient; credit structure is sound and savings increasing. Sees end to “orgy of speculation,” return to old fashioned value standards.
Some observers talking of return of old-time value standard of 10 times earnings and 5% yield.
F. Purnell, Youngstown Sheet & Tube Pres.: “There are plenty of evidences that the steel industry is looking up. We have passed through many months of depression but that is all behind us. ... Industries consuming steel are increasing activities.”
Commerce Dept. foreign news report assembled from its foreign representatives: trend to economic improvement in many European and Far East countries.
Concerns that recent stock declines have weakened banks with high levels of loans on securities called absurd by “responsible New York banking circles”; most country banks reportedly more concerned with employing surplus funds than with their liquidity. While it's true security loans are close to record level, liquid assets are so enormous that freezing even a large number of security loans wouldn't imperil banks positions; banks also have large capacity to borrow from Fed.
Economic news and individual company reports:
BLS reports Sept. employment in 13 industrial groups was up 1% over Aug., with payrolls up 1.4%; first increase this year.
Commerce Dept. reports Sept. merchandise exports were $318M vs. $300M in Aug. and $437.7M in 1929; imports were $227M vs. $217M and $351.4M; second consecutive monthly gain for exports, and first increase in imports from Aug. to Sept. since 1926.
S.W. Straus reports Sept. building permits in 577 cities were $168.3M, up 4% from Aug. but down 23% from 1929; reverse of usual seasonal decline.
Steel ingot production for week ended last Monday was at 55% vs.56.5% prev.week and 60% two weeks ago; US Steel was at 60% vs. 61% and 62%. Iron Age reports iron and steel buyers again very cautious, reducing inventories and doing less forward buying.
US cotton mills consumed 394,321 bales in Sept. vs. 352,335 in Aug. and 545,634 in Sept. 1929.
Supreme Court to consider whether West Palm Beach should be forced to levy taxes sufficient to meet its bond obligations; bondholders are calling for this, while city officials say they are doing everything in their power to meet obligations and collecting new tax would be “physically impossible.”
Companies reporting decent earnings: International Shoe (expense cuts produce better earnings on lower sales), Wm. Wrigley, Federal Water Service.
“' I want to get my advertisement into the hands of every farmer in the county,' a patent medicine spieler in a small town told the crowd around his stand preparatory to selling them his medicine at 'a special advertising price.' 'I'll tell ye a good way to do that,' announced a farmer in the crowd. 'Jest have it printed on the backs of mortgage blanks.'”
Appearing at the Palace (vaudeville):
The Marx Brothers present “bits of nonsense” from their recent picture Animal Crackers; also featured are Cab Calloway's orchestra and magic by Cardini.
+ The Boring Stuff: