Most important development in next Congressional session as far as financial community is concerned will be Glass Senate inquiry. “The inquisitorial committee has broad powers to go into almost any conceivable angle of the country's financial machinery.” Exactly what the committee will do will be decided when its membership reaches Washington after Dec. 1, but Sen. Glass and other committee members resent statements it will be a “Senatorial fishing expedition.” Investigation will probably concentrate on banking and Fed. Reserve, but subject of short selling might come up as Sen. Glass is an outspoken critic of the practice.
Conference of British coal mine owners and workers ends unsuccesfully; possible major strike seen. Over 20,000 coal miners in Spain go on strike.
Chile contemplating 35% tariff on all goods manufactured locally to provide work for unemployed and defend against dumping of foreign goods.
French Chamber of Deputies supports A. Briand foreign policy following 10-day debate involving “surprising shifts of support.”
Warden Thomas of Ohio state prison recently told paroled prisoners they could come back as trustees if they couldn't find honest work outside. A large number have apparently taken him at his word, coming back to where they are at least assured of a warm place to sleep, plenty to eat, and 2 cents an hour for their labor.
Pan American and Imperial Airways to collaborate on transatlantic service from New York via Bermuda and the Azores, possibly using “seadrome” floating landing fields being developed by du Pont to shorten “hops”; service will begin by carrying airmail only, flight time of three days hoped for.
Berlin is soon to have another zoo, “much larger and more pretentious” than the present world-famous Tiergarten. The new zoo is being set up to attract tourists; it will contain “the most extensive and most modernly maintained collection of wild animals in the world,” including 120 polar bears.
Sears catalog to contain advertising section with space sold to national advertisers; Sears distributes two catalogs a year, with circulation of over 7M copies.
Market wrap: Recovery continued yesterday, with “general list enjoying the most prolonged respite from pressure since early Sept.” Bulls encouraged by better technical position seen in greatly deflated brokers' loans, and by good copper news. Moderate but persistent advances in majors including US Steel, American Can, Consolidated Gas, AT&T, and New York Central; coppers strong; active short covering; upward trend sustained to end of day, with day's highs near the close. Bond market moderately active, generally higher; US govts. continue firm; foreign mostly steady; corp. irregular but mostly higher.
“Speculative sentiment” decidedly cheered by recent string of positive days without “encountering a fresh flood of liquidation”; seen as indicating main body of stocks “has absorbed most of the impaired holdings that appear likely to be thrown at it,” suggesting a more sustained recovery may be at hand.
Shearson, Hammill & Co. bullish: “not in sympathy with the extreme wave of pessimism which now prevails ... We believe a gradual improvement in business is under way.” Consumption has exceeded production for some time. Corporations have ample resources and have become more efficient. “The recuperative power of our country is great. The banking situation generally is strong.”. Credit is easy. Increased savings by individuals means latent buying power. Considering all this, “and that security prices generally are much below their real value, we unhesitatingly strongly recommend the purchase of” sound and well-managed stocks.
Insurance companies reportedly have increased buying of common stocks in past two weeks; seen as reflecting belief they offer good long-pull prospects.
G. Charls, Nat'l. Assoc. of Flat Rolled Steel Mfrs. pres.: “Once it was considered necessary to reduce wages in periods of depression. Today the entire steel industry accepts the principle that such reductions only reduce purchasing power and delay the return of prosperity. Industrial buyers pushing for lower prices on steel should be mindful of their joint responsibility in helping the steel industry maintain the purchasing power of its employees.”
Economic news and individual company reports:
A recent indication of stocks passing into strong hands on a large scale: brokers' loans extended by NY City banks were down $987M in past 7 weeks, to $2.235B, while loans to non-brokers were up $150M, to $2.042B. “In the past, increases in loans to non-brokers, especially when accompanied by decreasing brokers' loans in a declining market, invariably have indicated buying to have been of better quality than selling, with an early upward turn in stock prices.”
Bradstreet's and Dun's weekly business reviews note continued uneven and difficult to characterize situation; while recession remains prominent and only slow recovery is expected, some bright spots are noted particularly in chain store and holiday sales.
W. Franklin, Independent Petroleum Assoc. of Amer. pres., says crude oil price has dropped below cost of production due to imports, calls for oil tariff.
Company reports since Oct. 1: 175 companies reported higher earnings vs. 1929 and 285 lower; 418 dividends unchanged, 40 increased, 61 cut.
Companies reporting decent earnings: R.J. Reynolds (expects 10th consecutive year of increased earnings), Vortex Cup.
Morocco, a Paramount film - “Brings a new Greta Garbo to the screen in the person of Marlene Dietrich, a German musical comedy actress who is an almost perfect double for the Swedish star in appearance, manner, and voice.” Also appearing are Gary Cooper, playing a French Foreign Legionnaire in “his usual simple, affecting manner,” and Adolphe Menjou in his first English talking role as a wealthy European.
Grocer - Here's your fly paper. Anything else? Customer - Yes, I want about six raisins. Grocer - You mean six pounds? Customer - No, about six raisins - just enough for decoys.
+ The Boring Stuff: