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About Medford mail tribune. (Medford, Or.) 1909-1989 | View Entire Issue (June 1, 1962)
Market Crash of 1929 Compared With Current Wall Street Mm Editor'i not: Elmer C. Wal ler, former financial editor of United Press International, covered the 1929 stock mar ket crash and the eventi lead ing up to the panic lelling and collapie. In the following dispatch he compares the 1929 market and the current ware of buying and selling that has hit Wall Street. By ELMER C. WALZEH UPI Correspondent The 1962 stock market break has a number of ear marks of the crash of 1929 with the ones that hurt the most in the minority. There have been the late tickers, big volume, sharp de clines, a roaring recovery. statements by government of- amounted to 151.10 points or liciais to allay fears on the I 39.6 percent. state of the economy, a move to investigate the causes of selling and talk of new con trols. Here is the 1962 perform ance: Prices declined from the record high in the Dow-Jones industrial average set last December at 734.91 to 603.96 at the close Tuesday. That is a decline of 130 points or 17.8 per cent. We had simi lar declines in 1953, 1957, and 1960. Here is the much swifter 1929 performance: Prices reached a record high in the industrial average on Sept. 3, 1929, at 381.17. By October 29, they had fall en to 230.07. That drop In the six sessions ending last Monday the average lost 73.77 points. The Tuesday re covery restored 27.03 points and cut the loss to 46.74 points. In six sessions ending Oct. 29, 1929, the average fell 96.44 points, the record de cline. Recoveries on Oct. 30 and 31 brought the average back by 43.44 points, cutting the decline to 53 points. Figures Misleading Volume is where the fig ures are misleading. On Tues day, sales reached 14,750,000 shares, second highest in his tory. The largest was on Oct. 29, 1929, when turnover was 16.410,030 shares. Today's market is seven times bigger than that of 1929 on the basis of shares listed. There are more than seven Medford Tribune SECTION P MEDFORD, OREGON, FRIDAY, JUNE 1, 1962 PAGES 1 to to ml WWmBS NATIVES WATCH - Thai Buddhist priests, clutching their food bags and their umbrel las, used to shade them from the hot sun and inclement rainfall, watch as a U. S. Army L19 observation plane of the 24th Infantry lunds on Friendship Highway near the 27th Command post at Korat, Thailand. The highway is used as a light airstrip. (UPI) An Eerie Similarity Congressmen With Little in Common Display Extrasensory Perception y if! By DICK WEST Washington - (UPI) - Rep. Elizabeth Kee is a woman. Bcp. J. Floyd Breeding is a man. Rep. Kee comes from West Virginia. Rep. Breeding hails from Kansas. Rep. Breeding is a member of the House Ag r i c u 1 1 u r e C o m m i ttee. Rep. Kee graces the commit tees on government opera tions and veterans sffairs. ' Apart from the fact that both are Democrats, they wouldn't appear to have a great deal in common. But on some matters, their thinking Is amazingly similar. Recently, both committed to paper their thoughts on the Alliance for Progress pro gram, which the House For eign Affairs Committee voted to cut by $600 million. Through extrasensory per ception, or some such phe nomenon, their thought waves began to travel in the same channel, and at some points merged into a single beam. Many congressmen, of course, have brains that are powerful enough to trans mit thoughts from one room to another, if the wall isn't too thick or if the door is left ajar. But the offices of Rep. Breeding and Rep. Kee are located in different buildings, separated by a wide thorogh fare. That their thought waves were able to travel such a distance is downright un canny. "It seems to me that the action of the committee em phasizes a growing dissatis faction, not so much with the idea behind the Alliance for Progress, but with the reluc tance of some Latin Amer ican governments to make the economic and fiscal reforms which are so urgently need ed," wrote Rep. Breeding. "It seems to me that the action of the committee, which undoubtedly will be upheld by the House, displays a growing dissatisfaction not so much with the idea behind the Alliance for Progress pro gram, but with the reluctance of some Latin American na tions to make the economic and fiscal reforms which are so urgently needed to raise the standard of living of the people," wrote Rep. Kee. This eerie similarity con tinued throughout the en lire statements which the two lawgivers prepared for mailing to their constitu ents. There may be some other explanation, but on the sur face it appears that Breeding and Mrs. Kee have telepathic powers beyond the range of other mortals and members of Congress. If they weren't so busy legislating, they per haps could make a fortune holding seances. billion shares listed, against one billion in 1929. Hence, to duplicate the big 1929 day, sales would have to reach 112 million shares. So far the old records on volume still stand - biggest day, Oct. 29. 1929; biggest month, October 1929; biggest year, 1929. The 1929 volume of more than a billion shares repre sented a turnover of all shares listed of 119 per cent. So far this year the turnover amounts to about 15 per cent of the shares listed. The market of 1929 kept right on declining after the October break. By July 8, 1932, the industrial average was down to a mere 41.22 that represented a loss of 339.95 points or 89 per cent. Dollar shrinkage by actual calculation amounted to $74 billion. Depression Forecast The 1929 market break forecast a giant business de pression that was to last until World War II started in Eu rope in 1939. Now the market experts are wondering if our present mar ket is forecasting a recession or depression. Markets have a tendency to forecast the fu ture since they are subject to the opinions of millions of minds, many highly informed. Market declines or ad vances occur without the fore casting quality from time to time. Take the drops of the day former President Dwight D. Eisenhower suffered his heart attack, our entry Into the Second World War, and the outbreak of the Korean War as examples. The fact that this market had a rousing recovery on Tuesday does not preclude a resumption of the decline. Back in 1929, the industrial average lost 38.33 points on Oct. 28 and 30.17 points on the 29th. It rallied 28.40 points on the 30th and an other 15.04 points on the 31st. On Monday of this week, the average fell 34.95 point.1;, second largest day's loss and came back 27. ui points on Tuesday. Speculation Ran Wild This market was supposed to be grounded on investment and not speculation. How ever, speculation ran wild some time ago, especially in the so-called glamor issues such as the electronics.. There are millions o shares locked in by high capital against taxes and "millions more held by institutions which are not easily frighten ed into selling. Mutual funds hold $23 billion of stocks. These holdings are supposed to be stabilizer, but recent markets have convinced the experts this is not so. Searching for reasons for the recent decline is as diffi cult as it was in 1929. Then as now prices were high in relation to earnings and yields. Then the market clearly predicted the great de pression. Now the problem as yet unsolved is whether or not a similar prediction is in the making. Todav'F. market oDerator Is more sophisticated than the I RO been a problem of big mar kets. Back on Oct. 24, 1929, sales totaled 12,985,000 shares. Tickers ran until 7:06 p.m.. four hours and six minutes! in large blocks and despite tape more than four and a kot h;s bn n sr i r,- after the official market close, the plus 18 million shares, the half hours late at the end of , by tin- break. !lnw then at 3 p.m. On Oct. 29. tape caught up at 5:29 p.m. the day. will dike lo n enpera 1929, the sales were bunched Tuesday's market saw the One thing is sure-lhe mar-1 unsolved problem. Salutes of 21 guns by U.S. military forces are accorded only to the President, vice president, rulers of foreign countries and members of ruling royal families. ljieMeseMMISMMeeMeMMiMMMeMMeMeMiMi II leear liTnl'' Yrtri-'-.:m.Ji I ' n?mn7 r t i U!!!!LU ; - ' r l- prrg?gr 'fTI ,1 I . J It's a nationwide event and , ; j I OPEN TONIGHTM355 j j FREE! 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