Assorted historical stuff:
A. Smith, Union Trust of Cleveland Exec. VP, addresses Nat'l. Battery Mfr. Assoc. convention; says present price levels and improving business outlook justify public buying for normal needs; predicts national efforts to relieve unemployment would put at least 300,000 to work in final quarter; “as to the immediate outlook for business, we have passed the worst of the depression ... The element of unreasonable fear and caution in business today is going quite beyond the realities ... we are working our way out of business depression because price declines are effective, like wage increases, in encouraging public buying ... I expect 1931 to be a period of unmistakable recovery, leading to a return of prosperity.”
Chicago Assoc. of Commerce launches “steady buying” campaign urging all those not affected by unemployment to buy “all normal wants.”
Johns Hopkins researchers establish fact that common cold is infection transmitted by “non-filterable viruses, minute disease producing agents so small as to defy most powerful microscope; if virus can be made to grow in laboratory tube, vaccine may be developed.”
French Nat'l Economic Council adopts resolution for calendar reform, with majority preferring the 13 month plan.
Mr. and Mrs. James A. Smith of Deposit, NY, have indulged their wanderlust spirit by traveling in 42 states over the past eight years. They live in “a regular cottage on wheels” measuring 11 3/4 feet long by 8 feet wide by 6 feet high. “It is equipped with electric lamps, running water, refrigerator, cooking equipment, wardrobe space, a six tube radio, comfortable chairs and a double bed.”
Port Norris Oyster Co. formed in Bivalve, New Jersey.
Market wrap: Heavy liquidation resumed, “some of it appearing to be necessitous in character.” Selling began in rails, including leaders such as New York Central, Union Pacific, Pennsylvania, and others; many sold at lowest prices in several years. Liquidation then spread in all directions; industrials were weak with US Steel hitting a new low since 1928 and other majors down sharply; utilities also severely pressured, including AT&T and Consolidated Gas. Liquidation continued heavy into the last hour, and market closed at the day's lows. Bond market more active, with liquidation in many parts of the list and many bonds hitting new lows for the year; corp. generally down, particularly convertibles; foreign irregular; US govts. active, firm.
Heard in the customers' rooms of brokerage houses: “The way stocks decline without any substantial support is beyond belief.” “Is there something we know nothing about overhanging the market?” “Why don't the 'big interests' do something to end the decline?” “Stocks are cheap, many selling far below respective book values. Why don't people buy?” “Will they ever stop going down?”
D. Haddock, Arkansas Chamber of Commerce: “The economic situation is 'buyological' rather than psychological. A new 'buyology' will solve it - buy something.”
Consumer finance companies are reportedly reducing their bank credit lines due to materially lower business this year, attributed to drop in radio and auto sales. Delinquencies said to be “far below expectations” and customers have paid down much of their debt, but renewed buying is not yet evident.
Dow made new post-panic low, closing at lowest price since July 1927. The Dow utility average broke below the fall panic low for the first time. There was one new yearly high and 270 new lows.
Economic news and individual company reports:
Bradstreet's and Dun's weekly reviews report trade and industry somewhat quieter, possibly due to Election Day holiday and end of peak fall wholesale season. some isolated bright spots due to holiday buying and cooler weather stimulating retail sales, but no broad trade revival seen.
Total loans on securities at end of Oct. were $8.814B, down $721M in Oct. and $4.391B off the Sept. 30, 1929 peak. The decline in loans has been entirely in loans by non-banks (corps. and individuals) - loans by Fed. Reserve member banks were $8.057B, up slightly from Sept. 30, 1929; these are now 91% of the total vs. 59% at the peak. Security loans to non-brokers have been gradually increasing since May; seen as indicating stronger or “better quality” buying.
The stronger 5-and-10-cent stores have generally had earnings only slightly below 1929; the two largest chains are Woolworth and S.S. Kresge.
Amer. Iron & Steel Inst. reports steel ingot production in Oct. averaged 50.32% vs. 55.10% in Sept. and 85.64% in 1929; first 10 months 68.01% vs. 93.92%.
French market calmer after Oustric Bank requests “judicial liquidation.” However, French banks still appears to be withdrawing gold from London, causing Bank of England to advance short term rates slightly. The French banking troubles also apparently caused some nervousness in German bank stocks.
Company reports since Oct. 1: 155 companies reported higher earnings vs. 1929 and 337 lower; 355 dividends unchanged, 35 increased, 53 cut.
Stock market joke:
“Applications for membership in the Half Century Club are coming in so thick and fast that enlarged quarters are being talked of. Practically the entire floor space of the Double Century Club is for rent and a great part of the space of the Century Club.” [Note: I believe this is a reference to stock prices.]
“'Are you going abroad next summer?' 'No,' answered Senator Sorghum. 'What's the use of traveling around among people who don't speak my language, and who couldn't vote for me even if they did.'”
+ The Boring Stuff: