TRADE
THE CHINA MAIL, MONDAY, SEPTEMBER 26, 1955.
COMMERCE
SECTION
STERLING STILL IMPROVING
Continental Speculators Take Chancellor's Word ECONOMIC CRISIS OVER?
-
London, Sept. 25.
The improvement in Sterling which began after Mr Butler's Istanbul denial that the British government were planning any early move on the monetary front continued last week at an encouraging rute. Sterling is stronger against the dollar but the biggest improvement has taken place in the exchange rate between the Pound and principal European currencies an indication that Continental speculators who gambled on a sterling devaluation are scuttling for cover.
Now that the British authorities are no longer having to spend dollars to keep the Sterling exchange rate above the lower limit of $2.78 the strain on gold reserves has been substantially eased. And this, together with improvement in the United Kingdom's overseas trade position in August, has given rise to hopes that Britain's much publicised economic "crisis" is already over.
to
"A dominant feature of both Fears that still tougher dis- well known adage goes. And so,j.
were our ancestors resigned them there sources of demand." Tho indationary measures
"trade Economist writes, everlasting being planned by the Govern selves
belleving that It cycles"
cochare ment have begun to recede, is now felt that the situation period of prosperity is followed "lumpy';
as surely can be kept under control by by a "alump"
fairly painless night follows' day. moderate and cuts in public spending which are, in any case, long overdue.
ถ
u
$0
un-
4
that they be naturally Hable to
that increases ur declines in them tune not as **directly tied to movements in current incomes as those who plan to control incomes through the budgol and Bank Rate would like.
There la still much of this autmoded thinking in evidence today, as witness the constant Now that the British economy
that the United States is out of immediate danger, feur some attempts have been made economy, which doininates the to discover what went wrong world, is riding for a fall. But Jittle How do cach "crisis" leaves us a with the boorn.
wiser, little nearer under- happen that Britain came
that the nature of real standing close to crisis in a
germ that infects each boom Ume of sense-at
constantly threatens to Like all seekers after truth, are often led by red herrings. An has economic malaise always many symptoms but generally only one cause; the difficulty is to isolate the former from the latter
Pista
BOOM FATALISM
them.
After
We
on
OWN CORRECTIVE
in- "A boom in hire purchase, deed, la so lumpy that it should bring its own corrective in time, small deposit at first it allows to chase a much bigger volume But thereafter, a part of current incomes is absor- payment of instalment do not chase new
of resources.
economy during
over
in bed."
QIL STRIKE HONGKONG Bullish Outlook
SENDS SHARES UP
New York. Sept. 25. New or 4 posible mafor all strike in Irael triggered demand for stocks af oil companies operating in and around the
young Middle" East country.
Pantepeq Qll Co., Pan Israel Co.. and Israel- American Olf Co. all rose sharply in heavy trading the American Stock Exchange.
་
Pan Kernel opened at $254 up $11% on a 30,500- share block. Israel- American opened on 15,460 shares at $2%, up $14.
Pantered rose $134 to 854 with 11,000 changing handa. - United Press
shares
NEW YORK
STOCK MARKET
STOCK EXCHANGE
(From Our Correspondent) :
Business on the Stock Ex- change this morning amounted to $1.000.000. Noon quotations and the morning's transactions: SHARES BUYERE DELLERS PALES DANKS
1739 15 1729
FIK Bazk INSURANCES
Lis
RDE
210 4 53
Lombard
SHIPPING
Waterbost
ROCICI, ETC.
Hock
20.10
Provident (0) 15.30 19.10 Wheelock .. 8.00 5.90 1000
RAS
9.00
LAND, ETC.
... 18.00 16.80 1500
18.70,
ific Land
Humphry
day 1515 1100
2015
.. 10.40 20
230 2.33 25000
2.325
RUBBER
Realty
Am. Rubber 230 2.335 000 2.326
5000 61 2.325
.. 10000 2.30 13000 230 20000 & 130 Trust .......... 3.30 3.39 11,000 # 3.319 UTILITIES
24.40 24.70 Trom Yaumall Ferry 115 117 600 118 C: Light (0)23.43 23.80 100
200
C. Ught (N) 18.30 18.60 1000 Electric
43% 200
Maceo Elec
New York, Sept. 25. Industrial stocks closed | at a new record high last INDUSTRIALS week 2 per cent below the Cement 500-mark in the industrial
by
3415 39 2000
30 3814
17.10
For US Business
Washington, Sept. 25.
The 'F.8. Chamber of Commerce predicted" that hualnem this year · would hit an all-time hirk,
on the
In the quarterly report the Boarious outlook, Chamber said almost all busines, with the ex- ception of agriculture, wan bitting new highs and the economy 'was. operating
it said, was
close to
Construct expreted to so still higher rbe even Fear and more in 1956. Construc tion bas 'been climbing overy year since World War II.
However,
the report
said, farmers were gilli in » period of adjustment.
United Press.
NZ Credit Squeeze Is Having Effect
Wellington, Sept. 25.
All sections of the com- munity are beginning to feel the effects of the credit 21.00 2220 300 @ 230 squeeze in New Zealand. The main reason for
the squeeze is the sustained pressure on the country's balance of pay ments.
Hope
Daly
Watson .... 1440 14.00 COTTONS
Textile Corp. 5.74 5:00 MISCELLANEOUS
Yangtze
average.
Rallroad issues were within sSTORES, ETC. one-cent of their highest level since October 26, 1920.
Sales contracted slightly, but the turnover was well above two mililon shares a day.
It was
a week marked sharp gains in individual issues. The moving force which kept the market going was a series of glowing reports from industry- reports of a record production. estimates for records for 1955 and predictions that the boom would carry over into 1956.
HIGHER DIVIDENDS
Allied
100 m 22
a 1.20 159 OB
1000 0.10 5.95
Warning On New U.S. Oil Policy
1
In the 1953/54 financial year consumer expenditures rose by £65 "millions compared with 1952/53 and substantial stocks acted as a buffer between" in- Cernal demand and a balince of payments defleit.
There
was
30
Butler's Credit Squeeze Showing Results
London, Sept. 25.
The behaviour of the London Stock Market strongly suggests that Mr Butler's credit squeeze is beginning to work. Companies which were pre- viously able to obtain finance for development by borrowing from the banks are now being forced to go to the market for their requirements of new capital.
effect.
And this is having a distinct
The market is no longer in a condition to fale now issues in
The present stagnancy of tho market has led many, observers to believe that the fall of prices may have further to go. strengthened
ite stride as it was during the This mal proximity of
share boom. Shareholders wish-
pay
the
g to exercise their Hghts issues cannot now
money from their bank,
by the
on industrials and gilt edged stock which, It is felt, calls
This by may come about automatically cuts in the public spending
they must raiso the cash by calls for readjustment, selling other holdings.
Government' securities and lead to 息 further fall Industrial shares both fellt industrial
shares-due
Industry's products.
on the
to
đ
lower levels
first two days of the week due, mainly, declining home demand for the 10 the
of new
Issues weight" overhanging
the market. The former were also affected by sales
from official holdings by Government broker-pres sumably to clear the way for successor to the serial funding stock which is approaching "ita redemption date.
Slight Rally
There was a slight rully Wednesday though the num
account
Peso Rate Rises In
Free Market
New York, Sept. 25.
The free market rate for
ber at bargains was unusually the Argentine peso has low for the first day of afirmed since the overthrow
but gilts which ad- vanced modestly on improve of the Peron regime. mint in Sterling held their Foreign exchange experts gains
botter than Industrials termed the rise "significant"." which were showing weakness again before the close.
Thereafter, the market saak back into its previous lethargie mood and for the remainder of the
week, price movements were mostly small and confined affected by special
to issue circumstances.
They said it indicated a belief in some quarters that Peron's fall heralds the return of some sort of political and economic liberty in Argentina.”
Mr Franz Pick a leading in- ternational monetary buthority, said the higher rate for the pest
black market
to
Financial Times Indices oforeign
Government
Peron's
market rate
puficials
or black
precedented prosperity over
Our experience over the destroy it. few months has taught us
bed in debts which anything, I is that the slightest economists evidence of trouble at home is astray
resources at all
In 1054/55 Consumer demand "It is worth pondering these
security and In- Immediately reflected abroad in
surged upward by another £81 exchange of the Pound When
millions and this time the coun
dustrial share prices, both lost noted "that the lanes 1
for the peso this happens, the trouble is apt
points (it continues): they
try's
overseas balances took the further ground during the week.
Among industrials,
motors fröm. of an "autonomous' downturn in
3.08 cents on Friday to become very real. Such is
Rest that there is some possiblilty
shook. the price of having a currency Economist" which has Britain, as it grows richer, may high
spending next year and that
meant to Wall Street,
were affected by news that car 3.13 cents on Monday. This
For the twelve months ended and
Wall Street exponta insist the record
id earnings
prices are to be increased with
a dominant position in
March 31, 1955, there was 0 contributed much to the under- be having to pay the price of dividend payments. One agency world trade,
balance of payments also by fears that the expected black market rate is a trus standing of economie problems the innate instability of demand said the market was discounting
record New York, Sept. 25.
Australian Import auta will | picture of what the, peso` of £39 million against a delicit has attempted to do this in tmt has hitherto been regarded dividends for 1988 * as well as The Chairman of Philips surplus of £28 millions a year Building shares declined on merely act illusion."
hurt Britain's car exports. warth, while the official rate is what it ferms an interim ro as a principal characteristic of for 1955. A
surge of Snoreased We are still a long way, how-port
the two
the Govern leading the wealthy American com pay-outs is expected in the Petroleum Co. Mr K. S. previous
June this year the agures fears of cuts in
"A FARGE" CVET, from knowing how to economic questions this We may now have two internal anat months of the year, and Adams said today oil im-
of
ament's investment prograjames, A top banker sold: 4 you worse. correct these periodic distur-ummer: the nature of the giants Limit can cause sudden this le expected to produce the ports are excessive" but he were
deficit in the balance of pay-
whole economic life of Argentina bances, still less how to prevent strains that have borne down temporary, chaos by turning usial year-end stock market urged a flexible and equitments of £42.3 million for the Change for better i want to be blunt about it, bho
all,
cannot upon British
But Argentine issues improv-runs on the black market, The rally.
June always count on getting out of the last few months of deficit This leads The Economist to There were periods of mod-able solution to the probe twelve months to
on the overthrow of the official rate is a farce, Why, the against a surplus of £25.2 mil ed the ability of the Bank three "reflections," The first is derate profit-talking but each lem. the simple expedient and
the preceding twelve Peron regime. The view here
black "the principal lesson of this alp brought in new buying.
market rate is what the upon of telling foreign speculators Rate to act as a brake
that
.. Mr. Adams made this state-ons in
Is that whatever administration
Argentines tticruelves
think then.
summer seems to be that that they are barking up tho
At the end of the week, the ment in response to the recent months,
There is not a cold financial succeeds to power in Argentina their money is worthi that strains oconomy is kept wrong tree. Búl if
3.78 points.
ger, Mr Arthur Flemmings to wind blowing in New Zealand, it could hardly treat British up 3. from strikes, the pro-point of maximum production,dustrial average stood at 487.43 letter from the Defence Mobill-
is starting up. then the
Investors worse
the cycle, budget,
foreign all through the
had been 18 oil importers warning them but a breeze Railroads, which demand
the coming previous one.
change it vertibility plan and the sharper
umpy elements in about the nervousness
(which are probably growing in depressed almost two points, to cut back voluntarily or Lace Developments in
in these markets last year alone almost made up the loss and government import restrictions, months will be followed with fat, must be for the business." Heald the turnover
Interest China
Oils were
lower, was cetimated at mostly
,500,000,000 rise in British than in foreign importance thanks to the new
finished at 184.28, off 0.01 from pinyed by
Philipa was one of the 18 considerable tole
notable exceptions being Anglo pesos, Mául Special.
14,000,000 or about which advanced on Ecuadorian, which
dollars. wage rates, were less important durables) are bound to jerk the last Friday which set the year's companies. components than the upsurges economy tito deficit from time high. Utilities dipped 0.29 to Mr Adams suid he had no
take-over rumours, and Trinidad That's a fantastic amount real investment and in
complaint" with the President's to time, however carefully P
Petroleum Development which for a country like Argentina,” Improved on higher divident. mendation that Imports should
Coppers, with the exception He said the black market peap noe ogorod their 1964, ratio to
the Illegal trading totat
of Tanganyika concessione were resulted in production
ini the
of 1 of quot However, ho
hard surrency bankpoles in Continental support," "and" South Argentina as well as private freezing the 1854 import ratios
African, gold shares remained transters to Uruguay, the United of individual companies would "grant to only a few
dull. Rubbers and tens werg | Stales and Switzerlang United helped by dividend news. sive right to
trouble by
we
aro
to find u
solution we must first discover election
cause of the sudden uptig
the
of home demand that start a chain reaction of waning con ndences in the Round,
In the past, we have tended
to be fatalistic about a boom. in "Each
believes
con-
of its own destruction," as the goods on the instalment plan.
U.S. INVESTORS NOT WANTED
close
the
consumer
05.30.
warned that
boom' carries the seed consumer purchases of durable carelessly budgets ore drawer was a feature of the fuel policy. committed's recom-
It almost reached the Pit the Government decide to 10f mock. It closed on Friday points on the continue with the present policy at 99%, up 94
week.
General Motors of flat out employment, it says, we
netted then they must realise that 3% points. Motor care produc- Shigro will inevitably be drains ton is rising again and a big on gold reserves from time to fourth quarter is anticipated." time, and be very careful not
mect these "risked" crises by really harm ful or delayed mellon methods of restraint.
JAPAN PUTS UP THE BARRIERS
New York, Sept. 25..
United States investors were finding increas ing difficulties in entering the Japanese chemical industry, Chemical Week, a trade journal published
by the McGraw-Hill Company, said today.
to
The steel pharts met good.
deliborat demand too and several reached 18 Adams do hardship on
SIX PER CENT?
The Economist's second re- flection is that experience has not shown the Bank Rate to be one of these harmful methods." I criticism there The criticism,
pri
AMERICAN
COTTON MARKETS
said this Youngstown 1060 new highs.
companies Who have 94 on further talk that its pro- those posed merger into Bethlehem made foreign investments, but Steel would be brought up soon, who are as yet crot in a position raw, dropped to sersonal laws
United Press.
to recover on them.
In the first seven months of with 1965, he revealed." Philips im- barrels dally, or less than one per Un- cant of U.S. petroleum ports-Unlied Press.
ports averaged 8.474 Japan Ready
be, is that, as per cent Banks To Cut Trade
Rate is not doing all the thingga in a brlurtul peonomy that it
would do in the sort of economy
Only once in the past eight, which temporarily at least that Britain had before the war: months had tho Japanese would throw thousands at one to achieve the old impact in the
With Goa
Sept. 26.
New Delhi. Japan prepared to
Singapore
the
New York, Sept. 25. Colton futures, under pres- turp for the third week in a deliveries nearby taking the brunt of the selling. The price-upselling factors included: (1) liquidation in before the October delivery firit notice day; (2) the Goy- ernment's decision to offer a million bales of low-grade cotton overseas at bargain prices: after January 1; (8) the porsistent export demand for raw cotton; (4) favourable prop the future status of Govern- of Traw capital investment favoured a system of cartels, a six per cchi Bank Rate India supplies the manganisa
ment prico and production Involving a chemical firm, less Chemical Weck said.
and Iran Shore that Japan now The third and pal reflection guis
the Portuguese Brokerp today quoted the controls. trom than a handful of reinvestment
by. cotton Raw
exports of India following stock price! Only in specific fields was is that it would be wise to actave, the Times projects had passed) eritiny,
Opening destination, as reported in bales and only
technical there much chance of foreign roly upon the Bank Réle to bid today.
by the New York Cotton Ex- arringements
been participallon that only then if secure necessary restraint, rather
The leading Indian newspaper Batu Lintang Rubber
British Bameo Petroleum
1985-36 scason change for the the same
investment Atted into than upot income tax which said QVET
Japanese cpland WBS Ma Japan's epopomie reconstruction can only be altered at certain bash on
Consolidated Tin baab en both political and period, the magazine” said, "
Der Nuove Lic Thie record contrasted prograinme, it said,
tim of the year at takes economic considerations. It salā
Tror Neay Ltd.: 1364 shárbly With
Possibly
the most enticing months to come into force, or under the boycott of clon-bound
dockworkers 籍 lure beckoning foreign chemical cuts in Government investment vessels on the port of Indian Hongkong & Shanghai
has become un-HongKong em Investors to Japan was the programmes, ***
"The Bank Rnte may not be codnomic for Japanese ship- Lunaa Rubber Estates perfect controllor," The owners and importers of Cloa Malayan Breweries & Economist concludes, But manganese
Government approved a case ployees out of work, and new conditions might need a trade linke with Gue provided Stock Market uncertainty about
eight
had
the
previous years when virt any agreement that promiscul
ic build up Japancés industry deemed Acceptable, was Chemical Week suid.
Twin Problems
the
potentially vast Chinese market that could open up at any time, the magazine said, the fre
Instit
G
Kerpar
Singapore, Sept. 20.
New Serandish Rubber
nobody has, suggested a better Endlari"displeasure? I oro to Putaling Tin
Also, the newspaper gold, sinapore Cold for
alimator of the South Brlik” Iosureno Jopen
conferon
and The Bank Of England Be conte
Statement
Pressure in Washington to one yet." lower the wall had been build- The magazine
said" : behind | Ind up for many monthe restrictions "ad": "future incours now "prival Javestiment "Wan a rapidly charging spirit of alloplin. At the The Japanisa' ́egnacib #the degree to which fórul
ment
dation,, Chapi
The Bank 62 mont
Rates
to Sept. 20 were as follows
Contibert
12.315 50X387
Orient
Canada
Total for seagont
Same period last year*
-United
The Bank Of France Statement)
than
Mr Pick sald black market.
activities in Argentina are big
he said.
Pres
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