Indianapolis Times, Indianapolis, Marion County, 5 July 1937 — Page 11

MONDAY, JULY §, 1087

COMPLETE N. Y. EXCHANGE STOCKS

+ The Times F inancial and Market Page » =

COMPLETE LOCAL LIVESTOCK

RECOVERY LEVEL

Consumer Goods Top| '29 Record; Electric Output at Peak.

NEW YORK, July 5.—Major lines of business rose 3} new high levels for the re-| covery in the first half of 1937 | and despite strikes and a slump in markets were hold-' ing well with outlook bright

for the second half.

Consumer goods industries ran above the 1920 levels while the heavy goods industries were below the record levels. In the consumer lines the main difficulty at the half year was the heavy inventories that have been built up. These coupled with high prices that might induce buyer resistance led to belief a reaction might be in order. Steel operations made the best showing in the heavy lines, The industry got up to 92 per cent of theo. etical capacity late in the half and would have broken all records had it not been for shutdowns caused by strikes as the half ended. Production of ingots amounted to 28,849,050 tons, against 21,276,097 tons in the first half of 1936, and 29,036,274 in 1929, the record year. The first five months of 1937 broke all records for the industry.

New Gains Made

Electricity output which made a new all-time high in 15368 continued to gain. The first half of 1937 was about 13 per cent over the corresponding period of 1936 and itself a record. Automobile output was hampered from setting a record by strikes in practically all the plants save Ford. The output for the first half is estimated at around 2,800,000 cars and trucks, against 2,594 508 in 1936. It was the best since 1929. Retail and wholesale trade continued to move ahead of 1936. The gain in the former ranged from 10 to 20 per cent and in wholesale the rise was 15 to 30 per cent, Purchasing power was raised by wage increases in many industries. The rise was so large that strikes failed to offset it and trade continued to advance. Late in June there was some slowing down in strike centers but gains elsewhere offset these losses. Higher farm income is expected | to come despite reduced commodity prices because of sharp gains in crop output. The latter in turn is expected to have a highly favorable effect on railroad earnings. The car loadings total so far this year has been almost 100 per cent in showing gains over the previous year. In the first 24 weeks of the year the car loadings totaled 17,398,054, a gain of 14.6 per cent over 1936 and a gain of 24.5 per cent over 1935 for the corresponding period. Some slowing down came as a result of strikes,

By United Press

Poorer Showing Building made a poorer showing than other lines and the outlook was less favorable largely because of rising costs. Residential building for the first half of 1937 was estimated by F. W. Dodge at $510,000,000 in the 37 states east of the Rockies. That compared with $335,000,000 in the corresponding period of last year. S. Seth Schnitman, economist for Dodge, did not believe that the rate of gain would continue, but he estimated that building for the full year would be 20 per cent over the $802,000,000 for all of 1936. Nonresidential building is expected to end the year at the same figure as 1936, with private commercial construction making up for a decline in public works.

BUYING POWER REDUCED IN JUNE

By United Press MINNEAPOLIS, July 5—~The average American citizen was better off financially at the start of June than on June 1, 1936, Investors Syndicate reported. Living costs on June 1 were 9 cents on the dollar higher than on the same date last year, but cash income averaged 29 cents on the dollar greater than on June 1, 1936, the Syndicate said. The difference between what the average citizen earned and what he spent at the start of June was 18 cents on the dollar, which is his “real income.”

AVIATION ORDERS HIT ALL-TIME HIGH

By United Press LOS ANGELES, July 5—An all-

time peak of $135,000,000 in Ameri-| 10

can aviation orders was reported today by the magazine Western Flying. The publication estimated its survey of orders in the hands of airplane parts and instrument makers was 95 per cent correct. Southern California led with , Douglas, $38,000,000; Consolidated, $14,000,000; North American, $9,000,000; Lockheed, $3,000,000; Vultee, $4,000,000. Large backlogs of builders elsewhere included, Boeing at Seattle, $10,000,000; Martin at Baltimore, $12,500,000.

HUNDRED STOCKS DECLINE IN JUNE

By United Press NEW YORK, July 5—The declining trend of stock prices in June reduced the market value of 100 representative stocks by $1,287,262,000, or 53 per cent, according to a monthly compilation today by Frazier Jelke & Co. Total market valuation of these issues was $22713961.000 on June 30 compared with $24 001,223,000 (revised) at the end of May.

! New Business Books

Available at Library

The following new business books now are available at the busitiess branch of the Inaianapolis Public Library:

ERE PABiedc, by Phill 6

Wright. An analysis of the powerfu forces at are shaping politica development in the Pacific area. LIFETIME OF SAVING-—THEN WHAT? by A. W. Brubaker. Legitimate methods to reduce the losses to which your estate is exposed under the new order of taxation, PROFESSIONAL UCCES SURVEY, by George M. Dan oth. Sound ethical and specific methods of building, enlarging or improving a professional practice. GOVERNMENT FINANCE, by Jens P. Jensen. ''The getting and spending by the State of the means required for the performance of the public functions which are the reasons for its existence.

(ROR ARBRE, of air,

AMERICA MAY EXPORT WHEAT

Kenneth G. Templeton Says Normal Crop Yield Will Stop Imports.

By United Press CHICAGO, July 5.—An old-time export trade in wheat will be established in this country this year, inasmuch as agricultural prospects are “exceptionally bright,” Kenneth G. Templeton, Chicago Board of Trade president, said today. In his midyear review of agriculture, Templeton pointed out that “with the production of normal crops, indicated by current forecasts, a situation which witnessed the importation of 43,457,000 bushels of wheat and 55,541,000 bushels of corn in the 10 months ended May 1, will be changed.” Recognizing the fact that Argentine corn has been shipped into this country in rather heavy volume this season, Mr, Templeton said that an average corn crop here this year will end corn importation, The real guarantee of profitable prices to the farmer, Mr. ‘Templeton stated, was the low stocks of all grains which are being carried over into the new crop year. Depletion of Canadian and Southern Hemisphere stocks to supply the excessive demands of Italy, Germany and England and the forecasts for poor crops in most European countries emphasizes the need and the market for a better-than-normal crop in the United States this year, Mr. Templeton concluded.

STOCK VALUES DROP 2 BILLIONS IN JUNE

Average Market Value of Shares Decrease $2.

By United Press NEW YORK, July 5—The value of listed stocks on the New York Stock Exchange declined almost

two and one-half billion dollars in June, Exchange figures showed.

On July 1 there were 1236 stock issues aggregating 1,399,549%739 shares with a market value of $54, 882,327,205. This compared with 1230 issues on July 1 aggregating 1,380,161,194 shares with a total market value of $57,328,818,936. On July 1, 1936, there were 1194 stock issues aggregating 1,339,579,670 shares with a total market value of $50,912,398,322., The average market value of all shares listed on July 1 was $39.21 compared with $41.27 on June 1 and $38 on July 1, 1936. Total borrowings against collateral by members of the exchange on July 1 were 2.16 per cent of the market value of all shares listed compared with 201 per cent on June 1

MILEAGE REVENUE UP FOR AVIATION

NEW YORK, July 5.—The Indicator for revenue passenger miles in air transport for May, 1937, stands at 1038, or 38 per cent improved over the corresponding period in 1936, according to the July issue of Aviation. ror April the Indicator stood at

9. While the figure for May was slightly lower than the previous month, it still continued to show an increase over passenger revenue for last year.

Sifting Monetary Winds Send Up Cros

Revaluation Fears Quiet Boom Talk In U.S.

Having taken yesterday a swift glance at the whole business and ecenomic scene, John T. Flynn now looks more closely at the forces which are at work beneath the surface. This is the second of three exclusive articles in which the noted journalist-economist affords readers of The Times a midyear review of business.

By JOHN T. FLYNN (Copyright, 1837, NEA Service, Ine.) june back we can see very - clearly now that since 1034 there has been, with the usual cyclical lapses, a steady rise in businesss activity. That rise is still go-

ing forward and will doubtless continue to do so for the balance of

the year. Up to now the whole drift of things has been in the direction of a gradual loosening of the energies of the nation — the drive being forward and upward. But now 3 : ys 2 oni force for the ys first time begins to run into adverse energies. The important fact about this is that these adverse energies are being actually generated by the recovery itself. That is they are, for the most part, as already observed, the chickens of the New Deal coming home to roost. First it is necessary to repeat that the one big driving force has been Government borrowing and spending. The thing that makes business quicken is the increase in purchasing power. To get an increase in purchasing power there must be a flowing of fresh funds into industry. Ordinarily this comes from private credit — chiefly long-term credit. This means mortgages, bond jssues, stock issues, and certain forms of bank credit. There has been an increase in bank loans during the last year, larger than in any year since 1929, and there has been some increase in bank loans the last six months. But this factor has been only about onethird as large as the extent of Government borrowing and spending. Now while this has produced recovery it has also produced some other things. And it is these other things, together with certain forces directly connected with Government policy which are now beginning to create troublous effects.

” ” ”

O make the matter plainer a paragraph of review is necessary. In 1933 the whole business system sank down. At that time the course of wisdom seemed to be to devote two years to reformsing the badly crippled economic system and then the next two years or more to recovery. After all, this is the capitalist profit system under which we are operating. We must either get rid of it or make it work. To make it work it must have certain conditions—profits, stability and certain controls. Nothing kills it off like uncertainties. A period of reform is always attended with uncertainties. This is unavoidable. Therefore the wise administrator would survey the field of essential and attainable reforms, put them through as swiftly as possible and then announce that the time had come to consolidate them, make them work and generally make the system work. Unfortunately this was not done. The first two years were taken up largely with an immense reform activity, but more violent in utterance than in action. Badly conceived and administered, it bogged down at the end of two years. Since that time there has been an immense amount of talk about reform, changes, experiments. There has been more talk than action. But the talk has served to keep everyone excited and uncertain, while true reform itself has gained nothing. ” 2 ”

EANTIME the following forces

are in operation. The Presi-| dent staked his program at first on |

getting prices up to the 1926 level. One plan was trade agreements. Another plan was devaluation of the dollar. Both have led to trouble. Prices have risen steadily. They are not yet at the 1926 level, yet already industry and trade is terrified and the President is talking about invoking the antitrust act to undo much that was done. More serious is the rising effect of the devaluation policy. Holding ourselves out to buy gold at $35 an ounce anywhere in the world, about three and a half billion dollars in gold have flowed to our shores. This has produced a serious increase in excess bank reserves. To check this the Government has now resorted to buying gold with funds obtained by borrowing to prevent the gold from getting into the banks. To date—in seven months—the

Government has borrowed $900,-

Import Trade Jumps in 2 Years

TREND OF OUR FOREIGN TRADE IS UPWARD

6003

(U.S. DEPT. OF COMMERCE)

LTH

THE PARKER CORP, GENERAL DISTRIBUTORS YNCORPORATED INVESTORS

BOSTON, July 5.—The trend of our foreign trade has been decidedly upward the past two years. There is a marked difference, however, between our recent foreign trade and that of several years ago. The time was when we were much concerned if our imports were greater than exports. Today, however, this viewpoint is changed, During the first four months of this year the value of our imports was 13% per cent greater than our exports.

a o Se

In seven months the Government has borrowed

s-Currents in Business

SEE

$500,000,000

+ + + « to buy gold which it does not need.

000,000. If it keeps on it will increase the national debt by at least a billion and a half just to buy gold which it does not need. At the same time the policy has upset’ international exchange relationships and we are on the brink of some sort of readjustment of exchange. The incident adds to uncertainty as to the gold content of the dollar. ” ” ” IX months ago the weight of opinion in Wall Street was that we were on the eve of a great boom. That opinion has now

changed. The change is due, perhaps, to some pessismism because of strikes, but basically to a conviction that inflation is going to be checked, that dollar revaluation is inevitable, that the budget will have to be balanced and that new and higher taxes are inevitable. Also the rising price level, which in my judgment is the most unfavorable factor, has served to scare off merchants who are already feel ing the effect of buying resistance.

NEXT-The immediate business future,

Commodity Break Wipes Out Millions in Crop Valuation

CASH PRICES OF 30

BASIC COMMODITIES

Used in United Press Index Compiled by Dun & Bradstreet, Ine.

Wheat, No. 2 Red, (Chicago) bushel Corn, No. 2 Yellow (Chicago) bushel Rye, No. 2 (Chicago) bushe Oats, No. 2 White (Chicago) Flour, Spring Patent (New York) 196 Lard, Prime Steam spot (Chicago) 1b

>. PL Coffee, Rio 7s (New York) Ib

Bukar, Centrifugal, 96 test duty paid (N.Y.) 1b.

ter, Creamery, 92 score (New York) lb. Hogs, average most sales (Chicago) 1b, Steers, average most sales (Chicago) Ib, Lambs, average most sales (Chicago) Ib. Hides, native heavy steers {Chicago 1b. ( (New York)

Wool, fine unwashed combin Cotton, spot middling uplan Silk, 13-15 deniers, crack XX Japan ( Rubber, spot ribbed smoked sheets Copper, electrolytic (New York) Ib Lead, spot (New York) Ib

Zink, spot (Bast St. Louis) 1b, .e..eeeves

Tin, straits spot (New York) Ib

r : Silver, commercial bars (New York) ounce....

teel Serap, (Chicago) ton

Iron, Iron Age Composite, (N.Y.) ton ....

Coke, Connellsville net furnace ton Cement, domestic Yellow Pine, 6 in, bas Douglas Fir, rough 6x6 8-24 ft. | ‘ Gasoline, drm, (exel. Tk. Wag. (N. Crude Oil Kan.-Okla, 40 gravity (Tulsa

By M. L.

June 21 Dee, 31 1987

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United Press Financial Writer NEW YORK, July 5.—Commodities advanced on the average to

within 92 per cent of the 1036 “normal” base in a runaway, speculative first quarter boom this year and then lost all of the recovery in a

second quarter break which wiped in prospective crop valuations.

Late in June the United PressDun & Bradstreet daily weighted price index of 30 commodities hovered between the 141 and 142 point

level, compared with a seven-year high of 158.26 recorded on April 5, the year's low of 141.12 reached June 91 and a final of 142.656 on Decem=ber 31, 1936. Although the index was at the year's low as the first half drew to a close it was more than 100 per cent above the depression low of 67.86 made on Jan. 20, 1933. The 1926 index average on the present basis of calculation works out at 171.62, or only about 8 per cent above this year’s high. On the early upswing grains made new highs ranging back to 1920. talk abroad, recorded new peaks ranging back moré than a decade. Cotton recorded a new high since

1030 and all other staples, with the M rch

exception of silk, were at new poste depression tops.

Tight supply situations, especially in grains, cotton, rubber and both

ferrous and nonferrous metals, the | March

upward trend of business, inflation=ary developments, and war clouds in Burope all were factors in the first quarter boom. Speculative ac

tivity swelled to the best volume M

since the boom year 1920. Improvement in the foreign situation, widespread rumors that the New Deal might change its gold buying policy in deflationary manner and an assertion by President Roosevelt that durable goods prices

were too high burst the speculative bubble. Metals led the downswing, copper falling 3 cents a pound from its peak and tin more than 12 cents. Cocoa futures, not included in the index, following the spectacular 1936 advance in which prices boomed more than 100 per cent. Cot« ton broke $15 a bale. Wheat fell as much as 30 cents a bushel. Rub« ber broke from a top of almost 27 cents to below 19 cents.

Half of the staples in the index, however, showed small gains over the closing 1936 comparatives, es< ally durable goods. Corn, cof« ee, hogs, lambs, hides, copper, gine, tin, pig iron, coke, cement, yellow pine, douglas fir, gasoline and crude oil all maintained advances. Wheat, rye, oats, flour, lard, sue gar, butter, steers, wool, cotton, silk, rubber, silver and steel scrap declined. Lead prices were unchanged.

Metals, which boomed on war | May

out hundreds of millions of dollars

INDUSTRIAL AVERAGE LOWEST IN APRIL

By United Press NEW YORK, July b5-Stocks made their best gains in January and their sharpest declines in April while bonds declined every month save May in the Dow-Jones avers ages. The following table gives the month by month range of the aver= ages with net changes from previous month: 30 INDUSTRIALS

High Close January .....186.90 185.74 Rpbriary “ 187.30

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HIGHER COST OF LIVING PREDICTED

By United Press NEW BRUNSWICK, N. J, July 5—Rising commodity prices and a much higher cost of living were forecast by Dr. Edwin W. Kemmerer, professor of international finance at Princeton University. Domination of inflationary forces is now pushing prices upward, Mr. Kemmerer said, resulting in the taking up of cheap money slack already created and in some cases creating more slack to be taken up. Three of the most powerful of the inflationary moves, Mr. Kemmerer pointed out, are: The devaluated gold dollar and resulting inflow of gold from abroad; our silver policy which necessitated an enormous expansion in silver cere tificate circulation, and the Gove ernment’s low interest rates and cheap money ,policy which encour ages credit expansion.

| Barioa soning sessions

PARIS CURRENCY FACES ITS THIRD PARING SINCE "14

Slash to 3.92-Cent Rate Held Impending After Currency Dips to That Level.

Times Special NEW YORK, July 5.—Fresh devaluation of the French franc, as suggested by Finance Minister Georges Bonnet, as one of the methods of resuscitating the government,

will mark the third time that the currency’s value has been slashed since the World War, The first occurrence was June 26, 1028, the sec ond last September, Before the war the currency system of France was based upon the gold franc and had a value equiv alent to 1930 cents in American money. Actually, however, the country was on what is known as the “limping gold standard” as payments could be made in silver coin as well as gold.

Transfers Restricted

France at that time held tightly the reins of curreficy. Exporting of gold for the account of private individuals was not an easy mater, since the Bank of France would in-

sist upon a small premium for this accommodation, This operation had two important repercussions—re= tarding the outflow and preserving the internal credit situation by making it unnecessary for intermitent boosts in the discount rate. When the spark of war was ignit= ed, France, like other nations, broke away from the gold standard and yellow metal disappeared from circulation. An embargo on shipments was clamped down and the central bank drew in all the gold possible.

The monetary law of June, 1028, put France on the gold bullion standard. The franc was given a value of 3.02 cents and contained 58.95 milligrams of gold. This measure replaced the law of 1799, concerning minting and assaying, and repealed laws passed during the World War, prohibiting the exportation of gold, silver and other bullion and coin, and melting and demonetization of national coins, and trade in national currency and specie.

Followed by Inflow

With devaluation accomplished, gold flowed to France in a steady stream. From the end of 1929 until August, 1033, the central bank's holdings almost doubled. Following the suspension of the metallic standard by Great Britain i nSeptember, 1031, the inflow was accelerated. In August, 1033, the Bank of France gold stock amounted to $3,223,000,000, compared with the United States stake of $4,009,000,000. In 1033 America went off the gold standard and on Jan. 31, 1934, devalued the dollar to its present level. This had the effect of automatically shooting the franc’s value up to 6.63 cents, Shortly after, new problems piled up, cabinets arose and collapsed. Last September the franc was devalued to a top level of 49 milligrams of gold, or 4.96 cents, and a lower limit of 43 milligrams, or 435 cents. The devaluation impending by Finance Minister Bonnet, it is believed, will carry the franc down to 3.02 cents, the level ruling in 1928. It also is believed that a floating currency will be established, thereby precluding the necessity of stabilization.

STEEL OUTPUT IN 6 MONTHS NEARS TOP

Shutdowns Prevent Industry From Breaking Record.

By United Press NEW YORK, July 5-~Shutdowns caused by strikes prevented steel operations in the first half of 1037 from breaking all previoug records for the industry. The total of 23,840,050 tons for the period was only slightly under the all time high of 849 tons for the peripd was only half of 1020. The following is a table showing steel production by months for the first half of 1037 compared with 1036 and 19290, Figures are by American Iron and Steel Institute with the June total The 1037 operating rate advanced 1037

120s January ... ,039, br ,056,081 M oy , ,333,853 071,875 3,032,605 ,153,559 4,037,375 4,268,170* 3,075,560 28,840,050 21,276,007 20,036,274 *Bstimated. . The 1937 operating rate advanced

steadily into April. During that month it touched the year’s high of 02.3 per cent in the week beginning April 26. It held steadily at 90 to 91 per cent until May 31 when the strikes brought it down to 77.4 per cent of capaeity. It subsequently broke further, but demand cone tinued high.

WHEAT PROSPECT IS LOWEST SINCE ’31

By United Press PARIS, July 5~The 1937 French

wheat harvest may be the smallest | M

since 1031 and about 2,000,000 tons less than annual requirements, the French wheat office announced today. The indicated crop is 71,500,000 quintals equivalent to 7,150,000 me= tric tons. This compares with 76,000,000 quintals in 1035, 83,500,000 quintals in 1934, 98,500,000 quintals in 1932. The wheat office will fix the official market price for new wheat late in August. Meanwhile farmsers will be entitled to draw advance credits through the farm credit

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Canadian Crop

Reported Less ‘Than Last Year

Times Special CHICAGO, July 5~Fading crop prospects in Canada the past week have furnished an effectual antidote to bearish sentiment caused by the increasing movement of winter wheat, and the consequent heavy hedging pressure. Prices showed substantial advances for the week in all world markets.

Estimates of Canadian crop losses as the result of high tem peratures and drought indicate at the moment that the Canadian crop will be no larger than the small crop of last year, Estimates range all the way from 187,000,000 bu. to 236,000,000 bu. for the three western Canadian proyinces. This creates a more serious situation than existed last year, as the carry over will be extremely light whereas a year ago Canada had a large surplus. ‘ Rust damage reports affecting winter wheat in this country have been numerous, but on the other hand the production in many sec« tions has been larger than expect ed, which may balance the rust damage, and maintain June 1 forecast of about 850,000,000 bu. Spring wheat is infested with rust to some extent, and affords the basis for some concern over the north west yield, but at present there still appear to be prospects for a much better crop of spring wheat than last year.

FEDERAL BONDS LEAD RECESSION

Issues Decline Eight Points In More Than Month of Downturn.

By United Press NEW YOR.s, July 5A sharp re=cession in United States Government bonds, halted only by the intervention of the Federal Reserve System, was the outstanding development of listed bond trading in the first six months of this year. The decline started at the begin ning of March and continued un-

checked for more than a month, carrying prices down as much as 8 points from the highs established in January. The Federal Reserve System entered the market in April, for the first time in more than three years, and, before the downturn was halted two weeks later had added more than $56,000,000 to its holdings of governments,

Prices Too High

The most acceptable explanation advanced for the break was that prices had been pegged too high, and investors believed drastic readjustment had become necessary. Government liens were yielding 1.33 to 2.54 per cent to the earliest callable date when the decline began on March 1, and, by the beginning of April, when the downward movement had about spent itself, these issues showed yields of 1.75 to 299 per cent, with the majority close to the much-discussed “3 per cent basis.” From that point trading proceeded at a more normal pace and prices moved steadily higher until, by mid-June, almost half the early losses had been recovered. Strikes in the steel and automobile industries, in addition to uncertainty caused by the action of Government securities, were major factors affecting corporate bonds. Following the break in Government funds, corporate prices eased and then broke widely as a series of strikes tied up automobile and steel plants.

Steel Bonds Hit

Steel company bonds were hardest hit, particularly Republic Steel and Youngstown Sheet & Tube funds. Convertible loans of the former dropped from a high of 212 to 127, while Youngstown issues declined more than 33 points from the highs. Issues of railroads in receivership or in process of reorganization weakened. First-class carriers, however, moved in a narrow range, Utilities followed the genaral downward trend, but showed greater rallying power, holding well above the lows and were irregularly higher as compared with the 1936 closings. General improvement was noted in foreign dollar loans, reflecting action by the Securities and Exchange ommission to protect American investors. Several governments, notably Brazil and Uruguay, assured American bondholders that interest and sinking fund requirements would be met more faithfully in the future th anthey have been, and considerable support was attracted to their bond issues. German bonds were strong, showing wide improvement over 1938 prices, while French issues weakened, influenced by uncertainties in Honesty and governmental policies. BOND SALES 937 1036 ,000 581,000 00 ,000 ,000 545,000

January . February arch April BY sevesinnne

JUNG cieuice ‘Estimated,

200, 220,

PRICE DROP OF FARM PRODUCE MAY CONTINUE

Prospects of Larger Crops Will Tend to Cheapen Market.

By United Press WASHINGTON, July 5~The dee cline in farm commodity prices bee gun in mid-April probably will cone tinue for several months, Departe ment of Agriculture economists bee lieve.

Prospects of larger crops this year will tend to force prices lower, but no sharp break is expected, economists said. Despite expected declines prices probably will avers age higher than a year ago, it was said. Increased marketings at least will offset any price declines so that total farm income this year probably will be at least as great as last year, F. L. Thompson, mare keting economist, said. Tending to prevent any sharp break in prices is the fact that the carryover of principal crops this year will be considerably smaller than normal, it was said. Ine creased consumer purchasing power also will tend to bolster prices against a fall,

Month Decline Shown

Farm prices on May 15 were 128 per cent of the 1009-1914 average. That represented a two point decline from the April 15 high of

130, a peak reached after several months of steadily rising prices. Two factors contributed to this decline. One was the immediate supply and demand. The other was prospects of increased production this year. Unless adverse weather upsets calculations, prices will ease downward as the new harvest approaches. Spread of a threatened drought in the great plains ‘bread basket” would tend to reverse the price trend and might even send prices higher than for last year's crop, economists said. Wheat and cotton prices suffered the greatest price losses during the past month, Wheat more than 15 cents a bushel below the high point, and cotton is off approximately 2 cents a pound.

Calves and Sheep Off

Declines in prices of calves, sheep and lambs were more than offset by price advances on cattle and

hogs. The latter was affected by increased corn prices. Fruit and truck crop prices registered substan tial gains. Despite the price decline starte ing in mid-April farm income in that month was the highest in seven years, Department of Agriculture reports said. Total farm income was $659,000,000, of which $76,000,000 was AAA benefit payments, compared with a $530,000,000 total in April, 1936. The carryover of principal farm products will be the lowest since start of the depression, economists said. The carryover of wheat will be less than 100,000,000 bushels and the lowest since 1919, it was forecast. The corn carryover, as a result of the 1936 drought which cut the crop a 1,000,000,000 bushels short, will be the smallest in 20 years, it was said. The cotton carryover will be 1,000,000 bales below last year's carryover of 6,950,000 bales, the department forecast. “It is obvious,” Thompson come mented, “that the present supply situation is such as to absorb at least a normal crop in most com modities without greatly affecting the price situation.”

FRANCE MAY JOIN STERLING GROUP,

By United Press LONDON, July 5.—A possibility that France for the time being will Join the sterling bloc was mentioned in foreign exchange circles here after Thursday's sharp decline of the floating Franc. The development, experts believe, will come after accounts have been settled with bear speculators. The Bank of France is known to be fond of squeezing bears and would like to force the franc rate back to 110 to sterling. But the French Treasury is more concerned with bringing gold back into the country and has insisted, according to reports here, that the rate for the franc be forced down to a level where capitalists can make a handsome profit by repatriating their funds. ;

WOOL TRADE QUIET 1 By United Press BOSTON, July 5—~Trade in spol wools on the Boston market was quiet the past week, due partly to inability to make immediate de« liveries and that mills were not keenly interested in purchasing for future requirements, the U. S. Agrie culture Department reported.

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