Business: Rally (Cont'd)

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Governor Meyer and the Young Committee were said to be pondering also vast Administration plans for both private and public works. But of sharper immediate effect on the market was the issuance of a government estimate of a 1932 cotton crop smaller by 6,000.000 bales than last year's. Cotton forged ahead five dollars a bale, carried other commodity prices with it. Further strength was lent the movement by a report that a $90.000,000 cotton pool was being formed by large textile mills and their bankers to take over Farm Board and co-operative holdings.

Strong commodity prices continued to form some basis for the skyrocketing share prices. But gains were small last week compared with the brisk July upswing that was led by hogs. The Annalist index rose but .3 to 92.5, a figure still below the 93.2 of July 12. December wheat climbed 7½¢ a bushel to 59½. Talk of the "commodity pool" and reports from Russia indicating a poor harvest there played into the hands of operators for the rise. It was learned that the Farm Board had liquidated four-fifths of its original 250,000,000-bu. commitment. Though reports were current that Chicago's famed Arthur W. Cutten was again plunging on the long side, he would only comment : "One should be careful about buying wheat on a bulge." Later he was reported to be forming, with the Administration's approval, a $30,000,-ooo pool. "I'm not in any pool and I don't intend to be ... not so long as the Government sits in the game," snapped Plunger Cutten.

Still shuffling off were steel production, automobile production, construction. The New York Times weekly business index declined to a new low. And Wall Street, because Governor Meyer called on other bankers besides the Young Committee while he was in Manhattan, was inclined to see a little closer connection between the stock market rally and the Administration's politically-inspired efforts to break the backbone of the Depression. If there was such a connection, Wall Street wondered whether the almost perpendicular market rise of last month might not prove a boomerang, hoped that the Giant of the West would not trip as he pulled himself up by the bootstraps.