Great Anticipations

Last week wheat had its first whirl on the Chicago Board of Trade since the excitement when that market opened after the bank holiday. Spot wheat touched 63-c-, up 5-c- for the week.

Last week corn had a whirl. Spot corn touched 35-c- (up 5-c-).

Last week rye had a whirl. Spot rye touched 50-c- (up 6-c-).

Last week Board of Trade seats touched $7,000 (up $2,000) and the Board of Trade began again to feel as if springtime were the only pretty ring time. Trader Thomas Howell was seen several times upon the floor contrary to his custom. Arthur Cutten was reported active. Oldtime Trader Gardner B. Van Ness was home from Manhattan. Herbert J. Blum, long inactive, was reported once more functioning. Jesse Livermore was back in Chicago with his new wife and reported bullish on corn.

The end of depressions, the beginning of inflations are marked by rising commodity prices. Many a depressed trader began to take heart last week. It was fine that corn was strong because higher corn prices mean bigger farm income for more farmers than do higher wheat prices.

Other commodities were on the mend. Sugar was up. Surpluses of sugar and wheat both reported down. Copper was up on news that U. S. mines were preparing for a six-month complete shutdown.

Stocks took their cue from commodities, mounted moderately led by such companies as American Sugar (in hope of a sugar recovery), Homestake Mine (bigger profits in gold if the dollar is devalued), Corn Products (in hope of corn recovery).

Many such boomlets had been reported off & on during the Depression. Traders looked for profit-taking--some of which took place. But in last week's bullishness there was more than a mere hope because prices and indices had shown a little upturn. There was the beginning of the attitude: what now if not inflation? Either inflation because commodity prices would be turned upward by natural and governmental stimuli; or inflation because the Government is committed to spending billions, must float bond issues to reopen banks, save mortgagors, provide relief and a dozen other costly enterprises. Or inflation because the Government might reduce the gold content of the dollar. Or simply inflation in expectation of inflation. Inflation or inflation or inflation. What other alternative?

Board of Traders asked each other: "Why else did Curtis Bean Dall buy a seat on the Board of Trade a week ago? He must expect it." Mr. Ball's father-in-law in the White House (where Mr. Dall visited over the weekend) took pains to foster the inflation psychology pointed out to the closed but not silent corporation of White House newshawks four points, all "anti-deflationary": 1) release of $4,000,000,000 in deposits still tied up in closed banks, 2) guarantee of Federal reserve deposits with a $2.000,000,000 fund, 3) higher crop prices and cutting of farm mortgage interest to make the farmer a better purchaser, 4) new employment, for the President favors using Government credit to encourage new construction.

Not only temporary signs but basic indices gave color to last week's hopes, showing moderate upturns. Carloadings were up 18,000 cars, fourth week's rise in succession. Steel ingot output was up likewise, also the price of steel scrap. Automobile sales took a good spurt. For the first quarter including the bank holiday they were 10%, below 1932 (the first time in four years that they have not fallen at least 25%) and sales since the holiday have risen so far above the expected increase that April 1933 may well be a better auto month than April 1932. Bank debits to individual accounts were up 29% for the week. Unfilled orders of U. S. Steel, off as much as 250,000 tons in the month's forecasts (because of the banking holiday), actually fell only 13,108 tons in last week's report.

While inflationary psychology was thus getting a start, it was abetted by talk of cutting the gold content of the dollar. President Roosevelt had finally issued an executive order, under power given him by Congress in the emergency banking act, ordering all holders of gold to turn it in to the Government by May 1 or take the penalty (see p. 9). What else did this mean except that the Government was gathering in all the gold preparatory to melting it into smaller dollars? Or it might mean that the Government wanted to gather up the maximum amount of gold to back the present dollar and permit release of earmarked gold to foreign nations.

Talk of a smaller dollar was promoted by another release from the self-styled "Committee for the Nation." This committee whose first announcement was issued and largely ignored during the banking holiday (TIME, March 13), consists of 101 businessmen and Yale's Professor Irving Fisher. It includes James Henry Rand Jr., president of Remington Rand. Frederic H. Frazier. chairman of General Baking, John Henry Hammond, chairman of the Bangor & Aroostook. Vincent

Bendix of Bendix Aviation, Samuel S. Fels of Fels Naptha, Philip K. Wrigley (gum), William Joseph McAneeny, president of Hudson Motor Car Co., Farny R. Wurlitzer (musical instruments), Errett Lob-ban Cord (autos and airplanes). Its first blast was sponsored by Frank Vanderlip. Last week Mr. Vanderlip was sponsoring something else (see below) so Lessing Julius Rosenwald. son of the late great Julius and chairman of Sears, Roebuck, did the honors.

Lessing Rosenwald, 42, 30-year veteran of the mail-order business, has lived in Philadelphia ever since he was sent in 1920 to manage the Sears plant there. He has diffidently described himself more than once by saying. "I am just a cog in the great Sears, Roebuck machine. My sole duty is to function smoothly." Careless of dress, wan of face, father of five, he had the idea for the new Museum of Science & Industry in Chicago, got it from the Deutsches Museum in Munich when taken there as a boy of 7 by his father. Later his father contributed $3,000,000 to make Lessing's idea come true.

Last week the "smoothly functioning cog" presented the five next steps which the Committee for the Nation desires:

1) Government guarantee of deposits in all reopened banks.

2) Suspension of specie payments till the U. S. and Britain can agree to go back on gold together.

3) Action to force down the value of the dollar in foreign exchange in order to make it easier for foreign governments to pay their debts.

4) A law to reduce the gold content of the dollar by about 40% in order to raise commodity prices to the level of 1926.

5) A non-partisan board appointed by the Government from all important economic groups to stabilize the price level at the 1921-1930 average and manage foreign exchange.

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