A great new blog, this: News from 1930 - a daily summary of events from the corresponding day in 1930 (taken – ahem – from clippings of the WSJ, but we’ll let that pass). H/T PK.A selection of market commentary from 22nd June, 1930:Col. Ayres, VP Cleveland Trust, predicts an abrupt recovery in stock and commodity prices by Labor Day due to current consumption exceeding production. Distinguishes between two types of depression, “V”-shaped and “U”-shaped.
Reduction of the rediscount rate to 2 1/2 percent is considered beneficial in several ways. It indicates credit will be easy for some time; should benefit many industries including farming, building, and construction, and make bond issues easier for corporations resulting in lower unemployment.
Stocks continued down, with big declines in the large trading stocks. Bears encouraged by the failure to hold Thursday’s rally after good news, and further breaks in the commodity market (wheat, corn, cotton). US Steel hit a new yearly low, followed shortly by Bethlehem Steel, Union Carbide, and American Can. Some rallying on the close on short covering. Volume not very heavy.
Commerce Secretary Lamont denies tariff will hurt trade. Notes that 80% of imports are duty-free or will have duty reduced or unchanged under the new tariff. Says flexible clause of tariff can be used to address remaining complaints of foreign countries. Notes that trade has increased for many years in spite of previous tariff increases. Treasury Secretary Mellon also has defended the tariff, and being the third richest man in the world he would certainly be opposed to it if he thought it was damaging to business.
And in other news…
A robot with “an electric eye, a radio for a brain, and magnets for hands” successfully performed a chemistry experiment. The electric eye observed acid being dropped into a basic solution; when a color change indicated the solution was neutralized the electric eye passed a signal to the radio, triggering a relay shutting off the acid flow.