Depression II

Last week Kennecott Copper Corp., whose operations fell to 16% of capacity in 1932 during the depths of Depression I, announced that beginning June 16 all its U. S. mines would be closed "for at least a month." Domestic scrap copper prices having tumbled from 10-c- to 6.75-c- a Ib. in eight days, Anaconda Copper Mining Co., one of the world's biggest producers, already had closed two of its biggest U. S. mines.

Producers of other commodities seem to have developed similarly sensitive reflexes since Depression I when business took its time about shutting up shop. In London last week the International Rubber Regulation Committee cut the third quarter export quota to 45% of basic allowances. Setting of the new quota, lowest since the Committee was formed, halted an abrupt decline in prices--19.7-c- a Ib. down to 11.3-c- since last year. Also the International Tin Committee ordered tin exports cut from 55% to 45% of standard tonnages. In Washington, Secretary of Agriculture Henry Wallace said he would soon reduce sugar quotas in the U. S. The petroleum industry, still hopeful of maintaining current prices, cut production to its lowest point in many months--3,098,650 bbl. daily, 77.8% of capacity.

Other items of Depression II: P:. In October 1936, General Electric Co. instituted its Cost of Living Adjustment Plan, paid employes making $4,000 and less a bonus based on the Department of Labor's cost-of-living index. Still on this basis, G.E. last week cut its bonus from 5% to 3%, its common stock dividend from 30-c- to 20-c-.

P:Most famed Wall Street success during Depression I was that of Atlas Corp., Floyd Odium's tremendous investment trust. How Atlas is faring in Depression II showed last week in its semi-annual report.. Between Oct. 31, 1937, and April 30, 1938, Atlas' net assets dropped from $71,229,929 to $56,565,662, its common stock's asset value, from $13.36 to $9.44 per share.

P: Since last fall some 1,400 Wall Street members of the Financial Employees Organizing Committee (remote kin to C.I.O.) have lost their jobs. Last week they petitioned WPA to create a new project for them--investigating corporations.

Slightly offsetting this gloom, some economists pointed to one sign that Recovery II might be just around the corner: Housing, white hope of 1938. at long last seemed to be bestirring itself. In May, home building east of the Rockies, as shown last week by the F. W. Dodge reports, topped both April and March levels. Though this could logically be laid to the weather, it was noteworthy that engineering contracts of $45,250,000 were 27% above the same week of 1937, shoving the 1938 total to date 7% ahead of last year.

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