Assorted historical stuff:
Editorial by T. Woodlock: in a recent speech, Gov. Roosevelt asked public support in a “war” between those against special regulation of utilities and those who recognize their necessity and seek to prevent them from giving “unreasonable profit” to the few. “Here is a summons to a 'Jehad' - a 'Holy War' issued by a man whose election ... as Gov. ... attracted the attention of the nation as perhaps” the next Democratic Presidential candidate. Stripped of the rhetoric, Roosevelt's stand is unfair; it means all the benefit of innovation and skills applied by the utility owner to provide more efficiency and lower costs must go directly to the users.
Rail executives ask for “new spirit and attitude” from regulators; point to difficult trends for rails since 1920, not even taking depression into account; claim that in spite of vastly improved efficiency, rails have never produced the 5 3/4% return on property investment contemplated in current law. However, in spite of lower earnings executives pledged to as far as practical “carry on ... work which may provide employment for the greatest possible number of men during the winter.”
Bulls arguing for wheat based on “increase in the demand for bread which always accompanies a period of depression. ... As a result of relief measures, millions of loaves of bread daily are being purchased from the various bakeries throughout the country with money raised to satisfy the hungry.”
New Jersey Legislature convened in special session to act on needed budgetary reforms after thorough investigation of state affairs by Abell committee aroused public sentiment. “New Jersey is still in a chaotic state of irresponsible officialism even worse than that from which Alfred E. Smith rescued New York.”
M. Tremaine, NY State Comptroller, points to soundness of NY State finances; net debt is under 1% of total assessed value of $28B; “The state does not issue bonds except for projects that last at least a life time.”
Over 1/3 of the 165,000 tons of sauerkraut packed in the US last year came from area of Geneva, NY. One plant has 77 vats, each of which has a capacity of 80 tons of kraut. Recent discovery of vitamins in sauerkraut has given a big boost to the industry.
Market wrap: Leading stocks made further progress on the rally. Bulls encouraged by optimism from steel industry and Farm Board, by more foreign buying, and by market ability to resist bad news. Major industrials including US Steel, American Can, and GE, staged good gains in first 4 hours. Reactionary tendencies developed in late afternoon on profit taking, but sales were well absorbed on moderate price recessions, with the setback appearing technical. Bond market more active; US govts. and high grade corp. strong; speculative corp. irregular; foreign govts. mixed.
Broad Street Gossip: The head of one prominent Exchange firm has been seeking opinions among his 1,200 customers; finds that experienced traders are now optimistic, having “been through numerous panics” in the past only to see the country recover and become “more prosperous than ever before”. On the other hand, the young trader with less than 10 years experience “can see nothing but black clouds ahead ... and just cannot see how industry can get back on its feet again.”
In past few weeks, fire insurance company funds have been increasingly invested in common stocks of leading companies with safe dividends; viewed as significant since these investments “are directed by shrewd and conservative observers.”
S. Strawn, Montgomery Ward chair., says recovery depends on business men not politicians; warns against “drift toward Bolshevism”; says great problem now is gearing production down so that it will “synchronize with consumption”; implies some wage cuts may be needed.
Market ability to resist bad news is in contrast with a short time ago, when it “ignored any favorable development.” In past week, market has dealt with failure of an Exchange house, wheat irregularity, decline in rail car loadings, bank failures, etc., with little more than a hesitation in the upward trend.
Economic news and individual company reports:
US internal revenue collections in Oct. were $80.041M vs. $86.774M in 1929; collections Jul. 1 - Oct. 31 were $788.4M vs. $857.6M; corporate income tax collections in that period were $324.1M vs. $338.1M; individual income tax collections were $259.2M vs. $302.0M.
Series of small banks in Ga., Ky., Mo., and N.C. closes; two sizeable Cincinnati banks taken over by Cinn. Clearing House Assoc. (acting for 8 member banks).
Some congressmen discussing reducing payments to “sinking fund” (for reducing national debt) in order to continue last fall's 1% tax reduction without deficit.
Commerce Dept. reports total US retail credit business of $20B/year; avg. loss on open credit sales 0.6%, on installment sales 1.2%.
Nat'l Industrial Conf. Board monthly survey reports Oct. business activities at low point for the present recession, Nov. so far at same level, but see signs “industry has reached a point where replenishment should begin.”
Companies reporting decent earnings: F. & W. Grand-Silver Stores, City Ice & Fuel, Mahoning Coal Railroad, Gibson Art (greeting cards).
“'Thankful! What have I got to be thankful for? I can't pay my bills.' 'Then, man alive, be thankful you are not one of your creditors.'”
An old and practical New England lady was on her deathbed. She called her favorite niece Grace and said “'I want to be laid out in my black silk dress; but take out the back panel and make yourself a dress from it.' Grace said: 'Oh, Aunt Mary, I don't want to do that. When you and Uncle Charlie walk up the golden stairs, I don't want people to see you without any back in your dress' 'They won't look at me,' the old lady replied. ' I buried your Uncle Charlie without his pants.'”
+ The Boring Stuff: