Friday, December 19, 1930: Dow 166.71 +1.11 (0.7%)

Assorted historical stuff:

[That'll never get off the ground dept.] J. Thomas, Committee on Petroleum Economics chair., impressed by “cartel” system applied to various European industries, regrets that similar international undertaking hasn't been attempted by the oil industry to stabilize prices; calls for economic survey of worldwide petroleum supply and demand.

[Two days = trend dept.] Editorial: Without growing too confident over the sharp stock market upturn in the past two days, the market action seems to indicate stocks had been “sold to a standstill,” likely more than reflecting the admittedly bad business news since Nov. Market action for the rest of the month will be highly significant; even moderate but sustained strength would likely indicate that the banking situations causing pressure on stocks and bonds for past months have “now been completely adjusted,” and that stock prices now fully reflect reduced corporate profits and dividends.

Washington report: House quickly passes $150M Farm Board appropriation for asked by Pres. Hoover to enable Board to carry on operations. Congress near agreement on emergency drought relief and unemployment bills and Muscle Shoals. Action on World Court postponed to next Congressional session. Increasing need seen for complete overhaul of rail regulation, but this won't be started until next session at earliest. Census Bureau unemployment figures questioned; new count to be started Jan. 15 in 20 cities.

Farm Board chair. Legge says believes cotton, unlike wheat, will return as export crop due to similar production cost worldwide.

[Strangely familiar.] Dept. of Justice conducting bankruptcy inquiry; Solicitor General Thatcher says losses in bankruptcy cases have skyrocketed in past 10 years; liabilities increased from $200M in 1920 to $806M in 1926 and almost $1B in 1929.

[I believe heated debate was the second-largest French export at the time.] Newly formed French govt. of Premier T. Steeg wins vote of confidence 291-284 after heated debate.

[Tragically misguided tax policy dept.] Two State Commissioners take charge of Berlin finances as a result of large deficits and refusal of municipal govt. to raise taxes on anything but beer.

Mexican Congress reportedly confers special powers on President to take necessary steps to improve position of Mexican silver currency; effort will be made to increase use of silver coins.

Editorial: Decline in farm income in 1930 isn't as bad as the reported crop value of $6.275B vs. $8.675B; when including meat and dairy, it's $9.950B vs. $11.850B. Cause of decline isn't entirely overproduction; for example, corn value declined to $1.379B from $2.043B although crop was 30% below average.

America's first speed limit law was enacted in Boston in 1757; restricted traffic to walking pace on Sundays.

Market commentary:

Market wrap: Stocks continued very strong through the noon hour; overextended shorts “subjected to additional embarrassment” and “given severe punishment” in some specialties. Market turned in the afternoon; specialties and copper retreated sharply but majors were well supported on moderate recessions. Bond market very strong, with sharp rallies all over the list; US govts. firm; foreign mixed, with many sharply higher; corp. very strong. Commodities firm early but ended lower.

Bank, trust, and insurance co. stocks enjoyed good gains on the day. Investment trusts were weak, remaining new yearly lows. Reports that some banks are preparing to buy more bonds.

Conservative observers caution against following rally up, see another test of recent bottom, advise waiting for it then buying gradually and protecting holdings with stop-loss orders.

Market observers sharply divided on how much of Wednesday's violent rally was due to short covering vs. investment buying.

[Downside was about another 75%.] Broad Street Gossip: From Sept. 10 to Tuesday's close was “about the most severe break in such a short period of time in the history of the Stock Exchange.” The Dow industrial average lost 87.58, the rail average 41.08, and utilities 33.63; even the Dow 40-bond average declined 4.82 from Oct. 1. “More startling still” is the decline from last year's peak; industrials dropped from 381.17 to 157.51; rails from 189.11 to 91.65; utilities from 144.61 to 55.14.

Many managed investment trusts (similar to mutual funds) holding “bluest of the blue chip stocks” are now available at 60 - 70 cents on the dollar. Sponsors feel this discount will eventually be closed and a management premium reestablished. Meanwhile, managed trusts must “go through the agony of preparing annual reports to the public” while the fixed trusts (similar to ETF's) currently in fashion “face no such painful problem.” Prominent firms are now said weakening in their opposition to sponsoring fixed trusts.

Broad Street Gossip: “Plenty of cash is available for stock and bond purchases, but it will not be used freely until definite proof is given of a turn for the better in either business or the stock market. Either would help to bolster the other.”

Many bears are now predicting steel production will decline to 20%-25%.

Rumors of banks pressuring borrowers to reduce loans on securities are contradicted by recent figures showing only modest decline from two months ago.

Silver price hits new low of 31 1/4 cents/ounce. Zinc plunges to record low below 3 cents/pound.

Trading favorites experiencing wild fluctuations included Auburn Automobile, J.I. Case, and Coca-Cola.

Many investors have been buying automotive shares in the belief they will lead on the upside as they did on the down (auto shares turned down in spring 1929).

Economic news and individual company reports:

BLS reports Nov. wholesale price index 80.4 vs. 82.6 in Oct. and 94.4 in Nov. 1929; retail food prices were down about 2% in month ended Nov. 15 and about 11.5% vs. 1929.

28 leading rails as a group are selling 11.1 times estimated 1930 earnings and yielding 7.5%. All but one should fulfill legal requirement for savings banks to buy their bonds (earned 1 1/2 times interest charges), but 10 appear unlikely to earn their common stock dividend.

Bank of U.S. deposits at closing Dec. 11 were $161M, or $42M below total on Sept. 24.

Fed. Reserve reports money in circulation Dec. 17 up $181M to $4.837B, total Reserve Bank credit outstanding up $163M to $1.297B. Member banks in NY City report brokers' loans down $91M to $2.008B vs. $3.386B in 1929; loans on securities to non-brokers up $23M to $2.064B .

Electric output by US light and power industry for week ended Dec. 13 was 1,748 GWHr vs. 1,729 in prev. week and down 5.3% from 1929.

Dow average of 8 iron and steel products remained at 1930 low of $44.42/ton. Scrap prices held but with little buying.

Some nervousness over continued drain of British gold to France; Bank of England's holdings are 151.316M pounds, down 1.132M in week and approaching “Cunliffe minimum” of 150M. British bankers confident “embarrassment” temporary, free working of gold standard will automatically end the movement.

French exports in first 11 months were $1.560B vs. $1.800B in 1929; imports $1.920B vs. $2.120B.

Leading Canadian banks and financial houses reportedly make semi-official announcement of formation of pool for supporting Canadian stocks.

Worldwide Nov. copper production was 139,914 short tons vs. 152,544 in Oct. and 170,585 in Nov. 1929.

Leather industry, like textiles, has been suffering difficulties for several years; some long-standing firms are liquidating, including Pfister & Vogel, formed in 1847.

Companies reporting decent earnings: American Can, Hudson & Manhattan RR.

GM cuts light duty truck prices $50-$150, to $645-$745.

Grand-Silver Stores stock about $16, dividend $1, earnings $3.97/share in 1929, 1930 earnings expected higher.

Movie:

[They should have hired James Cameron.] Danger Lights, an RKO film produced with “Natural Vision”; wide-film, wide-screen process “aims to produce third-dimensional effects”; does give illusion of greater depth in panoramic shots, but in closeups produces blurred picture and sound. Since most of film is closeup dialogue scenes, result is very unsatisfactory.

Poem by William T. White:

Humpty Dumpty sat on the wall, Humpty Dumpty got a great fall; All Morgan's money and Henry Ford's men Can't put Humpty Dumpty together again. What made Humpty Dumpty fall? Nobody knows for certain at all.
Some say the cause was the stock market crash, And the call which the brokers sent out for more cash. ...
Some think Humpty was filled up with gas, And thus it was that it came to pass, Inflated with credit, high prices and rent, And call loan interest at 20 percent. ...
Some say that Humpty had lived far too high On Good Times cake and Prosperity pie. Had too much to spend and to much to eat, Causing surplus production of cotton and wheat. ... Of things to see and hear and drive - Radios and motorcars, sakes alive!
'Twas little wonder he ... fell from the wall; But nobody knows for certain at all.
Can Humpty be put together again? So far all efforts have been in vain; ... they'll succeed without a doubt;
But when they'll get him back on the wall, Nobody knows for certain at all.

Thursday, December 18, 1930: Dow 165.60 +8.09 (5.1%)

Assorted historical stuff:

Jacob Ruppert [former brewer, reasonably successful Yankees owner 1915-39] says return of “real beer” inevitable, would provide work to 1M men, aid commodity prices, provide $300M in tax revenues.

Editorial: The Dept. of Justice is already investigating bread prices [why they haven't declined along with wheat prices]; now “the Senate has been asked to seize its investigation spade and begin mining operations on the other side of the loaf. The probable benefits to the public are exactly nothing.” Flour is only 20%-25% of bread cost, and other costs are mostly fixed except wages, which it would be undesirable to cut.

Commerce Sec. Lamont, speaking at aeronautics regulatory conference, says govt. policy is to interfere as little as possible with industry; hopes industry will conduct itself so that little regulation is necessary. [Without fear of governmental authorities people would swallow each other alive - Rabbi Chanina, Ethics of the Fathers]

US District Judge W. Clark finds Prohibition void due to invalid ratification method; US to appeal immediately to Supreme Court.

Washington report: Sen. Watson (R, Ind.), Republican leader, assures Pres. Hoover Congress won't adjourn for Christmas holidays until emergency drought relief and unemployment bills passed. E. Meyer nomination for Fed. Reserve governor seen likely to pass in Senate; Rep. McFadden's fears of foreign entanglements seen unrealistic by Fed observers. Pres. Hoover to withhold Wickersham Commission report (investigating Prohibition) until Dec. 1931 to avoid controversy at this session of Congress. Senate requests Col. Woods' report on unemployment due to reports his suggestions were rejected because of cost; Pres. Hoover says Col. Woods made no formal report.

[Strangely unfamiliar.] Agriculture Sec. Hyde says only $25M needed for drought relief; expansion of loans dangerous; seed loans had started during war but are now “annual recurring propositions”; these loans are step toward the dole; if food is included this time, next time it will be clothing; if loaning to farmers, why not to laborers?

G. Swope, GE pres., gives radio address on N.B.C. outlining plans GE provides to its workers for life insurance, help in buying homes, pensions, and now a proposed unemployment insurance supported by combined worker and company contributions.

Editorial: Anger in Congress over rail opposition to waterways begs question of what rail's attitude should be. Advocates of waterway transport seem to believe it inherently cheap as an article of faith. Owners of railroads have a right to ask that economic soundness of each waterway project be established by “competent and disinterested” authority before public funds are spent; engineering opinion isn't enough since “engineers are notoriously unreliable in their commercial judgements.”

Rep. Luce (R, Mass.) denounces Rep. McFadden's statements attacking the banking system and Gov. Meyer of the Fed. Reserve. [see yesterday]

Guatemalan govt. overthrown; revolutionary leader Gen. M. Orellan named provisional pres.

A. Hitler, German Fascist leader, sues Werner Abel, former Hitlerite, for perjury in claiming Hitler received funds from Mussolini in exchange for understanding that when Fascists attain power in Germany they would relinquish claims to the Southern Tyrol.

Customs war between Czechoslovakia and Hungary seen inevitable after delegates unable to reach trade agreement to replace one that expired Monday.

Australia seen having reached financial crossroads after successfully dealing with $500M of maturing loans in 1930 by redemption and new loan subscriptions (recently completed with new $140M loan); govt. successfully resisted attempts by “extremists” to force postponement of maturing loan repayments.

Wall Street's panic of 1884 seen as unique for having been caused by fraud in high places (two bank presidents misdirected millions into “the market maw”).

NY Emergency Employment fund has final meeting at Hotel Astor; total of $8.269M raised. Owen D. Young, committee member, spoke: Fund is not charity but means of relieving impact of a disaster, like a flood or earthquake, that affects some more than others. Confident “disease of unemployment” will ultimately be mastered; the process is slow because US doesn't want economic dictatorship any more than a political one.

Manhattan on Dec. 16 is first area to adopt new system of telephone exchanges involving name+number (“Murray Hill-2”) instead of just name.

Market commentary:

Market wrap: Heavy selling continued in the morning, with many leaders hitting new lows, but a violent rally began shortly after noon, with sweeping comebacks in the leaders and rallying throughout the list. Bond market suffered heavy early liquidation followed by sharp late rally, with most issues ending lower; US govts. slightly lower; foreign mixed with many record lows; corp. mostly lower. Commodities strong; cotton and grains up sharply in the afternoon.

Sharp rally was met with cheering on the Exchange floor and in customers' rooms.

Rumors were widespread that the banking consortium that stabilized the market in Oct.-Nov. 1929 had decided to step in again, but these were baseless.

Recent rail weakness seen disturbing the market; many brokers had been recommending them.

Broad Street Gossip: Following several months of predicting a bottom, market observers are now almost all noncommittal. Those discouraged by current conditions should recall that in some past depressions you could buy govt. bonds in the 80's, and you were lucky if you could withdraw money you deposited in the bank yesterday.

Recent market action strongly suggests a temporary climax to the downtrend that “may represent the lowest levels for several months at least.” If the market continues to parallel 1920-21, stocks may move in a narrow range in early 1931, higher in mid-year, then hit final lows in the summer about 10% below the year-end bottom. In any case, market is seen in strong technical shape for near-term recovery, and banking circles are confident this will happen.

T. Gerlach, Illinois Mfrs. Assoc. pres., sees business ready to spring forward. “Even the most conservative must see signs of vast improvement over 1930's industrial doldrums. ... People have been making the old things do, but the desire to spend is inherent in American life and accounts largely for our high standard of living that is the admiration of the world”; over $2B will be distributed this month in interest, dividends, bonuses and Christmas clubs; this is slightly below last year's total but will buy more. The one cloud on the business horizon is the possibility of unsettling legislation; it's to be hoped Congress will adhere to the constructive statements made after the election by both parties, and restrain the more radical elements there.

Henry Ford says believes business recovery will start soon although improvement will be slow.

Sharp increase in GM sales attributed to dealer restocking of new models rather than pickup in purchasing demand.

Economic news and individual company reports:

[Pretty amazing drop.] US Agriculture Dept. estimates value of all 1930 crops at $6.275B vs. $8.675B in 1929. Canadian Agriculture Dept. estimates value of all 1930 crops at $629.1M vs. $949.0M in 1929 and $1.125B in 1928.

[Green shoots dept.]
Steel trade reviews report better forward buying; seasonal upturn expected in Jan. US Steel ingot production for week ended last Monday was at 44% vs. 43% prev. week and 64% in 1929; independents were at 33%, vs. 34% and 63%; industry total was 37%, vs. 37% and 63.5%. This was better than expected; a year-end decline had been seen as likely.
Survey of 500 diversified plants in Cleveland finds 40% definitely expect employment increase in Jan., 50% no change, and 10% decrease.

Auto finance company earnings have unexpectedly held up better than other auto-related cos. in spite of lower volume, due to lower rates and small loan losses.

Freight traffic handled by class 1 rails in Oct. was 39.292B net ton miles, down 17.9% from 1929 and 18.5% from 1928 [somewhat worse than the car loadings drop.]

Call money rate eased back to 2%.

Twelve Arkansas banks closed, taken over by state banking dept.

Calif. allowable oil production quota reduced 40,000 barrels/day to 500,000; actual Nov. production was 604,573.

New York and London banks returning more capital to Germany following decree making Breuning financial program effective and adjournment of Reichstag.

World sugar producers hopeful compromise can be reached with Germany to restrict production.

Christmas card sales are reported running ahead of 1929.

Companies reporting decent earnings: F. & W. Grand-Silver Stores, Telautograph (machines transmitting diagrams by wire), Citroen (French, cars).

Newmont stock (copper) price is about equal to total earnings per share for 1928 and 1929 ($36.28).

Dance:

Sophia Delza made her dance debut; chief virtues are great personal charm, costumes, and “a temperamental understanding of the Russian mood of pathos.” Highlights included Lament, to music by Bartok, Eastern Beggar's Prayer, to music by Daf, and the particularly striking Dance of Frenzy, unaccompanied by music. [Died in 1996, later became instrumental in popularizing tai chi in the US.]

Joke:

“'I am sorry,' said the dentist, 'but you can not have an appointment with me this afternoon. I have eighteen cavities to fill.' And he picked up his golf bag and went out.”

Wednesday, December 17, 1930: Dow 157.51 -5.83 (3.6%)

Assorted historical stuff:

[Strangely familiar.] Editorial: The Senate's fight with the President continues, unfortunately for the country; “many members of the Senate consider it the foremost duty ... of that body to put Mr. Hoover in his place.” Current dispute is on whether the administration will control the $116M emergency public works appropriation. Mr. Hoover has the weakness of “excessive sensitiveness, amounting at times to an intolerance of criticism.” He therefore made his unfortunate “playing politics” remark, leading to Senate retaliation. It's clear the public works spending should be under executive control; hopefully the Senate will “some day” return to its duty of public affairs.

[The Fed as Antichrist dept.] Rep. McFadden (R, Pa.), House Banking and Currency Committee chair., opposes nomination of E. Meyer as Fed Reserve chair. on grounds he has “international financial connections” and so putting him in charge of the Fed. would turn it over completely to this “international financial group.” McFadden also wants committee to investigate cause of 1,100 US bank failures this year.

Bank of U.S. branches opened Tuesday to allow depositors to request loans of up to 50% of balances; loans will be made next Monday. Thirteen small to medium banks in Carolinas closed, along with one in Iowa.

Washington report: Increasing sentiment in House against railways for opposing waterway development; “anti-railroad bloc” seen possible. Fate of $60M Senate drought relief uncertain. Federal employee wage raise likely. Extra session of Congress still seen unlikely.

Editorial by T. Woodlock: Solution for “wheat problem” must lie in combination of tariff, strictly controlled production, and more efficient “industrial” farming using fertilizer.

Dept. of Justice investigation of bread prices [why they haven't gone down as much as wheat] seen unlikely to seriously affect business of large baking cos.

US manufacture of toys this year will be about $100M.

The renowned old Mason and Dixon line between Pennsylvania and Maryland was run by the two famous British mathematicians in 1763-67. The original stones used as five-mile marks on the line were carved in England from limestone, and are still there, with the Penn arms on Pennsylvania side and Lord Baltimore's coat of arms on the Maryland side. [Some are still visible.]

Columbia Broadcasting system subsidiary obtains permit from Federal Radio Commission for experimental television station.

Chicago making plans to entertain at least 75M visitors at its “Century of Progress” exposition in 1933.

At the galleries: Museum of Modern Art presents works by US painters and sculptors; most distinguished pieces are “huge burnished aluminum 'Wrestler' done by Dudley Vail Talcott and an even more monumental plaster by Gaston Lachaise entitled 'Man, 1930'.” Roerich Museum exhibits 100 old master drawings from private collection of Prof. Frank Jewett, including drawings by Raphael, Tintoretto, Titian, and Correggio. Exceptionally fine jade collection of E. Kukutani of Shanghai to be sold Dec. 17. ['Wrestler' was shown at this exhibit in 2001. And, a week ago, Christie's sold a single Raphael chalk drawing for $48M.]

Market commentary:

Market wrap: Stock liquidation broadens, with bad breaks throughout the list. “Brave attempt” at early rally wiped out by fresh flood of liquidation in late morning. Bond market generally weak; US govts. firm and highest grade corp. issues steadier. Commodities mixed; Farm Board hard pressed to maintain wheat support.

Particular weakness in banks and trusts, oils, rails, utilities.

[Profound analysis dept.]
No news seen to account for the decline, which was “generally attributed to the desire of additional holders to get out of the market entirely at least for the time being.”
Baar, Cohen & Co.: There's currently so much bad news and uncertainty that “the big moneyed interests ... are husbanding their resources to be ready to take care of any possibilities or eventualities that may arise. If new uncomfortable situations develop, therefore, the 'powers that be' are in position to handle them. ... On the other hand, if most of the fears at this time are groundless, those reserves which are being held in readiness will be free to enter the market. That is why we think we are very close to the bottom, and would rather buy than sell stocks here.”
Broad Street Gossip: Stocks have been declining for 15 months, in the most severe downtrend in Street history. The fourth quarter has been particularly bad; there have been few rallies, and the Dow has lost 81.75 points since Sept. 10, while even the Dow 40-bond average is down 4.68 points since Oct. 1. “With hundreds of stocks selling far below their respective book values and giving very high yields, this is no time to sell.”
Precedent indicates we're in “culminating phase of the prolonged depression”; conditions are similar to those in 1907 and 1921 that “marked the climax of the dislocation in business and securities.”

Market observers again are looking for “selling climax” of sharp declines on high volume.

Foreign liquidation of securities said heavy in recent sessions; attributed to European political unsettlement and unwarranted rumors concerning banking conditions.

Brokers reported increased investment buying on a scale (gradually) down. This is expected to increase due to year-end dividend and interest payments.

Bond weakness attributed to bank liquidation, tax selling, selling to protect stock accounts, fear, and lack of usual buying from life insurance cos.

[Another interesting data point on banks.] In past two weeks, Fed. Reserve member banks have increased holdings of govt. securities by $51M and reduced other securities by $89M, probably to “fortify their liquid positions.” However, banks don't appear to be pressuring customers to reduce loans on securities.

Agriculture Dept. notes business has declined from peak as much or more as in other major depressions of past 50 years. Sees seasonal improvement in many lines of business following holiday season possibly developing into general upward swing, but expects slow and irregular recovery.

Short interest has reportedly increased over the past week or two, but many of the big professional bears are cautious or have moved to the sidelines.

[I would have lost big on that one ...] Canada Dry cut annual dividend rate to $3 from $5 due to sales and profit drop in current quarter; stock sold off sharply, other soft drink producers also weak including Coca-Cola and White Rock.

[Pretty sobering ...] Highest-rated stocks on the Berlin market now have dividend yields of 10%-12%; “lack of confidence” blamed.

Dow made new post-panic low. There were no new yearly highs and 403 new lows. All three Dow Jones stock averages, as well as the Dow 40-bond average, made new 1930 lows. Many majors hit multiyear lows, including US Steel, New York Central, Texas Corp.

Economic news and individual company reports:

[The percentage decline vs. 1929 is actually improving here, mostly because at this point in 1929 the economy was already down substantially.] Rail freight loadings for week ended Dec. 6 were 787,173 cars, up 86,088 from prev. week and down 146,136 or 15.6% from 1929 week.

Commerce Dept. reports Nov. merchandise exports $289M vs. $442.3M in 1929, imports $204.7M vs. $338.6M; first 11 months exports $3.568B vs. $4.815B, imports $2.853B vs. $4.090B.

[Green shoots dept.]
GM reports sharply higher Nov. sales to dealers; 57,257 cars and trucks, vs. 28, 253 in Oct. and 60,977 in Nov. 1929; attributed to resumption of Chevrolet manufacturing following model changeover.
Recent advance in steel prices reported holding well; price “shading” (discounting) has almost disappeared.
Large department store sales have apparently been holding up well, although profits are likely to be down due to constant inventory write-downs.

Farm Board gives no indication of resuming cotton stabilization in spite of decline to new lows; attributed to belief prices are near bottom.

Spain declares martial law; latest revolutionary movement apparently fails.

Silver down to new record low of 31 5/8 cents; Chinese currency down sharply.

Bank of France continues support of sterling.

“Ivar Krueger, Swedish match king,” to lend Poland $30M at 7% in return for extension of Polish match monopoly to 1965. Price of matches to be raised 25% and all lighters subject to special tax to service the loan.

World sugar producers conference ends with “gentleman's agreement” to restrict production and exports, excluding Germany.

Crude rubber consumption by US mfrs. in Nov. was 23,479 tons vs. 27,659 in 1929; stocks of crude rubber in mfrs. hands ending Nov. 189,925 tons vs. 92,219.

Companies reporting decent earnings: National Power & Light.

Universal Pictures increases 1931 production budget to $18M from $15M in 1930.

Joke:

“Caller - When is the best time to see Mr. Smith? Stenographer - That's hard to say. He's grouchy before he has his lunch, and afterward he has indigestion.”

Tuesday, December 16, 1930: Dow 163.34 +0.0 (0.0%)

Assorted historical stuff:

Washington report: Pres. Hoover and Senate remain at odds. Senate has modified some Hoover proposals; particularly objected to is expansion of $25M drought relief to $60M and making it usable for buying human food, which administration considers a virtual dole. Rhetoric has become heated, with Hoover's accusation of playing politics at expense of human misery met by strong counterattacks, including Sen. Lafollette's resolution to “put human suffering in this emergency over consideration of wealthy taxpayers.” Prominent Republicans reportedly have been discussing drafting Coolidge to run again in 1932; this appears unlikely to go ahead.

[Reassuring commentary dept.]
Editorial: The NY Clearing House [assoc. of banks] is housed in a small building on a downtown side street that few know about. At times it has seemed antiquated and no longer useful. But every now and then, when a crisis erupts, this independent association of bankers plays a very important part in correcting the situation. Its recent measures [after Bank of US failure] are an outstanding example of how the Clearing House, aside from its everyday functions, acts to protect its members and to maintain banking on a sound economic basis.
NY Mayor Walker urges public not to withdraw funds needlessly from banks; “financial structure of the country and the city ... is organized to safeguard the deposits and savings of the public.”

Children's Bureau reports steady increase in child labor in 3 years before current depression.

National Economic League (organization of business leaders) reverses position on Prohibition, with 55% voting in favor of repeal.

Hoover dam construction work advanced about 6 months to March 1931.

[Says it all ...] Reminiscence of the 1907 panic: A reporter asked one of the most prominent brokers what started the panic and received the terse reply: “Somebody asked for a dollar.”

[Kind of amazing if “bucket shop” had the same fraudulent connotation it does now.] Lehman Brothers presented one of the first amateur sound movies at its annual dinner; seven “actors” from the firm took the parts of 42 different characters in a film entitled The Old Oaken Bucket Shop that “burlesques the course of an issue through the various departments of a banking house.”

Market commentary:

Market wrap: Stocks under pressure early, with many leaders hitting new bear market lows; pressure lifted after accumulating sell orders had been absorbed in the first hour, with good rebounds in leaders; late action irregular but renewed bear drives resisted. Bond market active, prices irregular but generally improved; US govts. strong; foreign mixed; corp. mostly higher. Commodities mixed; cotton down again to new season low on little news; copper prices back to about 10 cents.

Conservative observers warn against adopting short side, advise waiting to buy until market shows ability to rally “more than a day or so.”

Considerable selling reported from uptown locations served by Bank of US; depositors with funds tied up may be liquidating to raise funds.

Local banking situation seen improved; uptown branches that underwent heavy withdrawals last week were reported practically normal.

Short interest considerably larger based on demand in loan market and greater loan activity between brokers.

Weakness seen in copper shares, oils, banks and trusts, insurance shares, and Krueger & Toll.

NY traction (mass transit) shares up on tentative unification agreement of IRT and BMT into public or semi-private corp.

[Profound analysis dept.]
Otis & Co. see reason to believe “market is entering its final phase of concentrated liquidation”; liquidation forced by financial developments may run ahead of the fundamentals and “result in discounting the worst that lies ahead in the business depression.” Experience varies as to whether bear market low is reached before or after business hits bottom.
Jackson Bros., Boesel & Co. see signs 15-month bear market has reached “culmination phase” characterized by “concentration of unfavorable news items with attendant liquidation. ... There is a wealth of evidence ... the great bulk of liquidation needed to square away the credit structure has been completed.”

[Conservative optimism dept.]
F. Sargent, Chicago & Northwestern Rwy. pres., says doesn't expect immediate business upturn, but confident recovery will be in full swing in second half of 1931.
Fourth quarter earnings are expected to be unfavorable, but a number of cos. are expected to show increases in Q1, and general improvement is expected in Q2.
Harvard Economic Society sees better farm outlook for coming year due to lower costs and likely moderation of drought. “By 1932 the depression influences on agriculture are likely to be in considerable part spent.”

C. Teague, Farm Board member, says Board acted to stabilize wheat due to prospect of fall to 50 cents/bushel or lower, which would have caused disaster not only for farmers but for banks and merchants throughout agricultural states. Sees much better chances for successful stabilization than earlier this year or in 1929.

Broad Street Gossip: Many “blue but not bearish” traders have been buying good stocks, though that requires courage in this market. They know “certain stocks are selling far below their respective intrinsic values”; while they don't know how much further down the stocks may go, they are confident of “handsome profits in time. ... They are bulls on the country and are backed ... by the fact that after every depression of the past good stocks have ascended to new high levels.”

100 shares each of United Corp. (utility), Pennsylvania RR., Standard Oil of NY, and Westinghouse would have cost $52,625 at the bull market high, but can now be bought for $18,450, and yield 6.1%.

Dow made remained at post-panic low. There were no new yearly highs and 342 new lows.

Economic news and individual company reports:

BLS report on 15 major industrial groups with 4.7M employees finds Nov. drop in employment of 2.5% and payroll of 5.1%; decrease said mostly seasonal.

[Pretty dramatic drops.] New stocks and bonds listed on the NYSE in Nov. were $141.7M vs. $346.3M in Oct. and $607.4M in Nov. 1929; first 11 months $7.6B vs. $14.5B.

Editorial: The National Foreign Trade Council report on world trade for 1930 makes better than expected reading; total world export trade in 1930 will be down about 8% from 1929, with worst declines in countries producing raw materials. Canada and Japan were down about 10%. [Not sure what this is based on - these figures seem very out of line with the official ones reported previously.]

Fed. Reserve member banks weekly report for Dec. 10: loans on securities unchanged at $7.769B, “all other” loans down $91M to $8.656B. Time deposits were down $17M in the week, to $7.355B.

Savings banks in NY [I think these mostly served smaller accounts.] reported Nov. gain in deposits of $6.8M to $4.607B, reversing Oct. decline of $4.4M and vs. $4.247B in 1929.

Canadian report: Ordinary revenues for 8 months to Nov. 30 were $261.7M, down $57.5M from 1929; expenditures were $252.5M, up $12.6M. Largest decline was in customs revenues at $95.9M, down $34.7M. Wheat problem considered serious; in 1929, wheat and flour exports totalled $493.6M, or 36.2% of all exports; dramatic decline in wheat threatens farm earning power and export surplus.

Japan reportedly suffering increasing number of strikes as companies break precedent and lay off workers due to deep business slump.

General strike reported in main centers of Spain; report in London that King Alfonso had been deposed and a republic declared.

Argentina exports for first 11 months $567.2M vs. $886.8M in 1929.

Sugar down sharply to 1.30-1.40 cents/pound after Germany withdraws from worldwide producer's stabilization conference.

Armour & Co. notes lower demand and prices for most leading meat lines; “even smoked meats eased off.”

Call money remained at 2 1/2%, up from 2% previously, but observers expected the rate to ease shortly.

Movie:

[This is probably the most famous case of an actor failing to make the transition to talkies - Gilbert was a rival to Valentino as romantic lead in silent movies, then was a bust in talkies. It was rumored that he was deliberately sabotaged by Louis B. Mayer. This supposedly happened because, at Gilbert's wedding to Greta Garbo for which Garbo failed to show up, Mayer made a snide remark and Gilbert knocked him down.] Way for a Sailor - John Gilbert “still entirely unconvincing” in talkies; “his voice is rasping and he exaggerates both his pantomime and his reading of lines.” He is also miscast as a tough sailor battling with his companions, including Wallace Beery.

Joke:

“Applicant (to magistrate) - I want some advice about my husband, sir. He left me 25 years ago and I ain't seen him since.” Magistrate - Well? Applicant - what about me 'aving a separation?”

Monday, December 15, 1930: Dow 163.34 -5.34 (3.2%)

Special Florida section:

Interesting facts: State is in same isothermal zone as Southern Spain, Egypt, and Southern China. Has 35,000 lakes and over 3,300 miles of coastline. Population increased 51% in past 10 years, second-largest increase to California. Tampa pop. about 100,000; greater Miami 150,000. Miami pop. doubles in wintertime.

Florida looks forward to active winter season; hotel bookings reported strong; Miami mayor Reeder: “Miami is ready to act as host to the greatest hegira of winter visitors in 34 years.”

[Stuff definitely worth driving five hours with three screaming kids in the back to see dept.] Must-see attractions: Silver Springs - largest spring in the world; Lake Wales - largest carillon in the world (musical instrument made of bells); Tarpon Springs - largest sponge market in the world; St. Johns River - only large US river flowing North.

Miami Beach and West Palm Beach report continued building of luxurious winter homes. C. Fisher, Miami Beach developer: “Even in times of obvious business depression, men of means continue to build their homes in the sun.” West Palm Beach home to stately villas of Harold S. Vanderbilt and Otto Kahn.

Boosters: John Benson [advertising executive]: “A huge wilderness of potential wealth ... The wide-flung network of excellent roads promises the building of more oases until all Florida becomes one great oasis, and then it will be an earthly paradise.” Peter O. Knight [prominent attorney]: “Any state that can successfully weather the catastrophes of the past 5 years as Florida has done is a state to bet on.” Alfred I. du Pont: Real estate boom thoroughly liquidated, banking situation very strong; sees prosperity ahead for state. D. Sholtz calls for putting Florida on year-round basis by attracting industry.

Assorted historical stuff:

[Productivity miracle dept.] Commerce Dept. annual report: fundamental cause of increasing US living standards is higher productivity; this uptrend in productivity proves recent economic advance was not driven mainly by business cycle but was a permanent achievement, uptrend to be continued when present recession ends. 1930 notable for continued demand for consumer goods despite recession. Making progress on reducing marketing waste, estimated to cost about $10B annually.

Washington report: Pres. Hoover offended Republican Senate leaders not defending him more vigorously against intemperate personal attacks in the Senate. Glass finance inquiry to start. Muscle Shoals controversy at the point “where each side seems to be trying to sell the other a gold brick.” Senate and House agree on $116M emergency construction bill. Officials keeping eye on developing agitation to pay off soldier bonus certificates at cost of $3B.

[Seems ridiculously low.] Census Bureau survey finds 567,540 unemployed (out of work, able to work, and seeking work) in 25 Southern and Western states, or 1.3% of population.

[Two out of three ain't bad.] R. Millikan, physicist, urges Assoc. of Life Insurance Presidents to develop insurance for unemployment, sickness, and old age, or these functions would be taken away from them by the government.

J. Pelley, NY New Haven & Hartford Rwy. pres., says rail, highway, waterway, and air transport should be coordinated, with rails as the backbone.

Editorial: Congress is apparently reaching a compromise on public power generation at Muscle Shoals. However, neither side is taking care of the one issue that could ensure the public got more from the project than “continual drafts upon the Treasury” - strict and public cost accounting. If, and only if, this is required, Muscle Shoals could be worth the cost; in fact, it would “become one of the foremost of American educational institutions, whatever its output of power ... ”

Editorial: Mexico is considering a new law guaranteeing the rights of property in lands. However, they're only doing this following “economic ruin brought about by the confiscation of property and expulsion of foreign capital and enterprise.” Foreign capital can only have confidence in the new law as far as they have faith in the government; this faith is currently low as reflected in Mexican bonds selling at 8-12 cents on the dollar. “Mexico is telling foreign capital that she has repented. But is her repentance of the pocketbook or of the heart?”

Spanish military uprising said quelled, rebels fleeing in disorder. Market less optimistic on stabilization of Spanish peseta in near future.

Fisher Bros. of Detroit to provide shelter for 2,500 destitute men at Fisher Body plant.

[They'll get to that one of these days dept.] NY Board of Estimate approves contract with Bell Labs subsidiary for elimination of noise in construction and operation of the new city subway. G. Harvey, Queens borough pres., hopeful suspended monorail will be great factor in solving borough transit problems; “I fully expect to ride in a monorail car across the entire borough in the not very distant future.”

Westinghouse Lamp Co. has built a lighting exhibit open to the public in Grand Central Palace containing a mini-city with 180-foot main street, 80-foot cross street, theater, school, 6-room house, stores, bank, art gallery, and factory; demonstrates “good lighting in all its forms.”

[Great torque but rides a little bumpy.] Christian Huygens credited with experimenting on world's first internal combustion engine in 1680; fuel was gunpowder.

Archeological excavations at Treves, Prussia find large number of molds and tools for producing Roman silver denarii. Problem is, there was no official Roman mint there, leading to conclusion this was a thriving forgery center.

Market commentary:

Market wrap: Stocks came under renewed liquidation in the short weekend session, led by US Steel but with sharp drops throughout the list. Selling pressure continued through the session; tone heavy at the close. Bond trading active; US govts. firm; foreign mixed; corp. irregular with weak tone. Commodities weak; cotton again declined to new season low. Hogs, butter, and eggs decline.

Week in review: Stock and bond markets suffered heavy selling; Dow stock and 40-bond averages hit 1930 lows. Bankers see conditions ripe for sharp technical recovery, following market pattern in 1920. German situation seen favorable on Breuning financial reforms. China currency suffers from record low in silver. Disturbances in Spain. Steel production and scrap prices continued down, but better outlook seek for early 1931. Cotton hit new season lows in spite of lower than expected crop estimate. Wheat market stable on Farm Board support; corn weak. Money markets slightly firmer on Bank of U.S. failure.

Most Exchange brokers now advise waiting to buy until the current declining movement ends, believe it's likely to “run into a climax” in the next few days. A few bolder commentators said the time has come to begin buying for the long term; with stocks, bonds, and commodities breaking simultaneously, “it was asserted that the bear market bore every indication of being in its final stages.”

Brokers report an increasing number of odd-lot (small) and full-lot investment buy orders accumulating at prices under the market.

“The good stocks, that is stocks of companies that will show better earnings this year ... have gone down with the bad.”

[Ay Chihuahua! dept.] Broad Street Gossip: “One prominent banker who has attended recent consultations called by bankers to find proper remedies for existing sore spots says that in his opinion the worst is over. The skies, the banker said, are clearer now than in six months.”

Loans by NY banks to non-brokers have been declining slightly for the past three weeks, reaching $2.041B on Dec. 10, vs. $2.060B on Nov. 19. This is against the usual tendency of these loans to increase when stocks are falling sharply; nervousness over Bank of US may have kept buyers out of the market. The fact that both brokers and non-brokers loans have only declined moderately for the past three weeks indicates liquidation has not been caused by impaired margin accounts.

Liquidation in the bond market has occurred on relatively low volume; average daily trading in domestic corp. bonds has only been about $7M.

Bond market observers point to similar decline in 1920, which was then followed by substantial upturn.

W. Storey, Atchison Rwy. pres., sees slow recovery but improved business in the coming year.

L. Randall, George A. Fuller Co. pres., believes construction costs “scraping bottom”; close to lowest levels in the last decade, and 10%-14% off the peak.

Dow made new post-panic low. There were no new yearly highs and 221 new lows. Many majors and specialties made new bear market or multiyear lows, including US Steel, GE, New York Central, Anaconda, Worthington Pump.

Economic news and individual company reports:

Net foreign borrowing in US from 1914 - 1929 was $11.834B; Europe accounted for $5.752B, Canada $2.566B, South America $2.491B, Far East $811M.

Total oil co. earnings in 1930 will be about 40% below 1929. Little prospect of improvements seen before next spring.

Irving Fisher's index of 200 commodities for week ended Dec. 12 was 79.8 vs. 80.7 previous week and vs. 92.6 a year ago.

Ford Motor world production in 1930 to be under 1.5M cars and trucks vs. 2M in 1929; this will be over 42% of industry total vs. 35% in 1929. Sales have run slightly ahead of production for the first 11 months.

Caterpillar 1930 net about $4.50/share vs. $6.16 in 1929; Int'l Harvester also expected to net about $4.50/share, vs. $7.10 in 1929; both cos. report encouraging fourth quarter business so far.

NYSE seat sold for $210,000, up $5,000 from previous sale.

Companies reporting decent earnings: Sweets Co. of America.

Movies:

Warner Bros. films about to start production include A Husband's Privileges, Red Hot Sinners, Beauty and the Boss, Bad Women, The Idol, God's Gift to Women, and Father Means Well.

Joke:

“Wiseacre - Haven't I always given you my salary check the first of every month? Mrs. Wiseacre - Yes, but you never told me you got paid on the first and fifteenth ...”

Weekly Blather Dec. 14, 1930

No Journal was published Sunday, Dec. 14, 1930. Since I'm now doing the snarky commentary day by day, I'm going to try some more free format commentary. First, my personal favorite item of the week, from Dec. 11:

Death of Rep. Stedman, last Civil War veteran in Congress, has started speculation on how long the last veteran of the World War would survive. Last soldier in the Revolutionary War died 86 years after its end; last one in the War of 1812 died 91 years later. Based on this pattern, last soldier in the Civil War would die between 1951 - 1956, and last soldier in the World War would die between 2004 - 2009.

This was a pretty good guess - as I mentioned, there are currently just three verified surviving WWI veterans, aged 108-109, all from the Allied side.

A couple of other things that struck me as interesting this week:

The constant talk about the “big interests” as a protective force for the markets - strangely unfamiliar, and I'd really like to know if it was based on anything solid - there seem to be so many mentions of their actions that the whole thing couldn't have been totally imaginary - or could it?

Bank of US failure - as I said before, I think the bank exposure to markets at this point might be a factor in the crash becoming really extreme, so it's interesting to see the market action this past week. Also, the reassuring commentary, as is familiar from last year when subprime began to collapse.

Educational dept: a great website for those interested in investing, particularly value investing - contains lots of hard to find material from Benjamin Graham (godfather of value investing, at this point in 1930 was coming close to losing his shirt), Buffett, Schloss, Klarman, etc.

A couple of quotes I thought of for some reason this week - these are, of course, completely off-topic and unrelated to current or 1930 events. From Ben Hecht:

“That is a fine thing about the Press - in a showdown, news and not authority is its idol. It will hurl its headlines spears at High Priests and Oracles and set up a clamor for their scalps. And 'truth must be served' becomes its battle cry. But it is an easily winded champion of truth. All High Priests and Oracles in distress know this. They have only to keep their alibis and denials clacking away until the derogatory noises subside. And then their alibis and denials will become news again, the preferred news, the news from the highest sources - authority's spokesmen. After which the editorial writers will take over and work their magic of turning black to white again and rodent-gray to royal purple.”

And from Joseph Heller:

“This administration has decided to fight inflation by raising prices to lower demand to reduce prices to increase demand and bring back the inflationary high prices we want to lower by reducing demand to increase demand and raise prices. Isn't that pretty much all your present economic policy amounts to?”

And finally, a completely off-topic plea for sanity in gadget-land: If there are any hardware designers reading this, please consider this request. I looked at a couple of E-book readers and did find them easier on the eyes. However, I really don't want to carry another big device and most of what I read is on my computer anyway. How about making a laptop or netbook computer with an E-paper screen on the top surface (readable when the laptop lid is closed). I mean, that couldn't cost more than $100 to add, and I think you could charge a pretty good premium for it.

Saturday, December 13, 1930: Dow 168.68 -1.63 (1.0%)

Assorted historical stuff:

Agriculture Dept. says 1930 to be remembered by farmers as year when weather, crops, and markets all went against them. Production of main crops was only 6% below 1929 in spite of severe drought year, but prices were lowest for years.

[Strangely unfamiliar.] Rep. Tilson, Republican floor leader, comes out against Senate's proposed use of drought relief loans to supply food, clothing, and other necessities; says this amounts to dole; if faced with starvation, farmers need relief not additional debt; relief should be supplied by Red Cross and local communities.

[Strangely familiar.] President's Emergency Committee on Employment reports at least 200,000 more employees working on public building projects than this time in 1929.

Clearing House banks considering raising loan offer from 50% to up to 75% of Bank of U.S. depositors' net balances if audit reveals enough liquid assets.

Germany has shifted from large trade deficit in prosperous 1927 to large surplus now; surplus should cover over 2/3 of reparations payments; bankers and economists believe German business may revive before other countries due to lower raw material costs and wages.

Reichstag adjourns to Feb. 3, assuring Breuning govt. of modified financial dictatorship without parliamentary interference until then.

F. Noyes, Assoc. Press pres., says public ignored newspaper warnings, both of 1929 inflation and overoptimism and of 1930 over pessimism. Says newspapers gave far better and more unbiased information then at any previous period.

Census Director Stuart says unemployment census will be undertaken in representative US cities.

[I guess Buffett isn't worried about this ... ] Editorial: So far the only congressional response to railway pleas for help has been indication that no important rail legislation can be expected in the current session. A weakness of our utility regulatory system, particularly for rails, is that even clearly deserved industry relief can only be obtained in an emergency. Rails will have to deal with poor business by cutting expenses; if this leads to unemployment it will be the consequence of the remorseless pressure for lower rates and excessive transport facilities. One bright spot is that the ICC for the first time seems to realize the severity of the problem and may be more sympathetic.

[Strangely unfamiliar.] So few citizens of the new Turkish Republic heeded the call to Mecca this year that no pilgrimage boat was chartered from Istanbul, as has long been the custom. Many Muslims from Iraq who had come to Istanbul to take the boat were forced to reach Mecca by other routes, along with a handful of Turkish faithful .

First direct commercial radio communication between Berlin and Shanghai.

NY-Washington air express package service to be started today by Western Union; will take 3 hours from sender to addressee.

Walking tests conducted by a rubber co. find average pair of galoshes good for about 100 miles of walking before being retired to the junk heap.

[They'll stop that one of these days.] S. Rothafel (Roxy theaters) says over-fast production and imitation of successful movies have harmed “talkies” popularity.

Market commentary:

Market wrap: Special groups including coppers, oil, and amusements were weak, but leading stocks showed good resistance, mostly holding steady around Thursday's closing levels. Some late irregularity on various rumors, particularly concerning Bethlehem Steel. Bond market liquidation eased; on lower volume, US govts. firm, foreign govts. and corp. mixed. Commodities weak; cotton hit another yearly low, and low since Aug. 1915; copper weakened to about 10 1/2 cents; silver hit record low at 32 1/4 cents.

“Large professional operators” reported doing extensive short covering yesterday, including “Bernard E. Smith, ... recognized leader of the bear crowd for some time.” Good support was seen some of the leading shares, including US Steel and American Can.

Brokers report few margin calls in spite of continued stock declines. Also report more bears in customers' rooms than at any time in months past.

Broad Street Gossip: Lower-priced stocks have suffered much greater percentage declines than “old-line” stocks. Some examples of 1930 high-low ranges: Glidden 38 to 8 1/2; Marmon Motor 30 7/8 to 5 5/8; Maytag 23 to 5; Warner Pictures 80 1/4 to 15 3/8; Zenith 16 3/4 to 2 5/8.

Dr. G. Frank, Univ. of Wisconsin pres., charges lack of leadership in US business; “our panicky present is the result of our planless past.”

[Strangely familiar.] A number of retailers report sales are lower than last year, though the number of customers has been about the same; “consumers have been giving more attention to lower priced articles this year.”

[Wait 'til next year dept.] L. Miller, Willys-Overland pres., says auto industry should be first to recover, inventory situation good, general belief business will return to normal in early 1931. A. Reynolds, Continental Ill. Bank chair., sees general outlook for business “conservatively brighter”; forces at work for the past year, though “not easily detected by the general public,” will help return to normal conditions; businesses more efficient; 1931 “unquestionably” year of recovery; depression less severe than in 1921.

E. Beatty, Canadian Pacific Rwy. pres., speaking in Chicago: “Things look better to me. They certainly are in Canada, and I think they are here.”

Nation Electric Power (part of Middle West Utilities system) sees upturn in business conditions on East coast based on increase in Nov. electric output of 4.1% over Nov. 1929; output has trended higher each week since start of Nov.

Once again, all three Dow Jones stock averages, as well as the Dow 40-bond average, made new 1930 lows.

Dow made new post-panic low. There were no new yearly highs and 142 new lows.

Economic news and individual company reports:

Some explanation for recent bond market weakness may lie in New York banks increasing their liquid position in the past week to prepare for “substantial withdrawals of deposits which might develop.” In the week, they sold $46M of securities other than govts., reducing this category to $1.114B vs. $1.219B on Nov. 26; at the same time, govts. have gone from $1.204B to $1.271B. Further evidence of nervous conditions seen in increase of $41M in currency circulation, and increase in call money rate to 2 1/2%, first time above 2% since Sept. 16. Fed. Reserve acted to keep money easy through open-market buying of $25M in banker's acceptances and $15M in govt. bonds, bringing govt. bond holdings to a record high of $617M.

Stocks of refined copper Dec. 1 were 369,832 tons, vs. 364,930 Nov. 1 and 126,919 on Dec. 1, 1929; total stocks Dec. 1 were 594,363 vs. 605,075 Nov 1.

California oil situation seen critical, with further curtailment necessary to maintain price structure. Current output is about 600,000 barrels/day, with market demand for the next few months estimated at 450,000 - 475,000. Gasoline price situation unsettled, with some retailers selling at 14 1/2 cents/gallon, 1 cent below official wholesale price of major companies.

Dun's and Bradstreet's weekly reviews report continued seasonal uptrend in retail, though still below 1929; future course of general trade and industry unclear.

British banking authorities not overly worried about continued gold exports; while money rates are up slightly, credit remains easy and it's believed that eventually the “machinery of the free gold standard will bring about an automatic stoppage of the flow.”

US and Canadian newsprint shipments in Nov. were 307,304 tons vs. 324,556 in Oct. and 369,944 in Nov. 1929.

Oct. tire shipments were 3.499M vs 4.405M in Sept. and 4.650M in Oct. 1929.

Canadian experts say reduction in Western Canada wheat acreage would be economically unsound if not disastrous to agrarian interests.

Guaranty Building & Loan of Calif. suffers losses estimated as high as $8M due to “defalcation of an official.”

Companies reporting decent earnings: Liggett & Myers (cigarettes), American Home Products (medicines).

Company reports since Oct. 1: 250 companies reported higher earnings vs. 1929 and 424 lower; 795 dividends unchanged, 78 increased, 132 cut.

Joke:

[They also removed the additional dialogue by Samuel L. Goldwyn.] Chicago Civic Shakespeare Society to present Fritz Leiber in eight Shakespearean plays at the Ambassador Theatre, starting with King Lear on Christmas night. “ Many of Shakespeare's original scenes and speeches, which have been missing from the play as hitherto presented in America, have been reinstated, in the hope that the story will move with greater continuity and directness as a result.”

Joke:

A bootlegger refused a customer's request to deliver Liberty Bell brand whiskey. “The customer bridled at this, and insisted that a vice president of his company had patronized the Liberty Bell liquor sellers, found the quality excellent, delivery prompt, and prices reasonable. 'That ain't the point,' said the bootlegger. 'Lookit - usin' the flag in advertising. Why, man, that's a federal offense.”