1955-09-26 — Page 9

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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