Foreign Trade – Emigration – Unemployment -Savings – Joint Stock Companies – Wheat Duty

«The Economist», 15 giugno 1929, pp. 1345-1346

Turin, June 4

A turn for the better seems to have begun in foreign trade as the April figures indicate a decreased excess of imports over exports of 749.7 million lire, against 849.5 million in the corresponding months of 1928, while in the first quarter the excess rose from 1,673.7 millions in 1928 to 2,349.5 in 1929. In the first quarter the most noteworthy increases in imports were: Corn, from 124,815 to 261,431 tons; oil seeds, from 81,097 to 112,703 tons; raw jute, from 16,539 to 18,029 tons; raw cotton, from 64,127 to 71,875 tons; broken iron and steel, from 114,460 to 227,216 tons; pig iron, from 27,025 to 43,426 tons; copper, from 16,997 to 19,637 tons; lead, from 5,104 to 8,277 tons; tin, from 1,075 to 1,475 tons; spelter, from 1,977 to 3,131 tons; machinery and parts, from 16,411 to 20,778 tons; coal, from 2,070,157 to 2,577,961 tons; mineral phosphates, from 140,138 to 181,830 tons; mineral oils, raw and lubricating, from 27,736 to 31,910 tons; mineral oil residues, from 101,281 to 130,319 tons; crude hides, from 8,267 to 11,521 tons; rubber, from 1,986 to 4,322 tons. Generally these increases can be interpreted as forerunners of future increases in exports, – but some people believe that there has been a permanent change in the demand for raw materials, as home industry must provide for an increasing population, no longer reduced by emigration. The net number of emigrants, less those returned home, was 240,000 in 1923, and decreased progressively to 177,000 in 1924, 81,000 in 1925, 72,000 in 1926, 67,000 in 1927. In 1928 the number is probably lower, and certainly no higher than 51,600. The effect of the increasing pressure of population seems, until today, to have verified Adam Smith’s rather than Malthus’ theories; each new worker coming of age creates a new demand for goods, but also an increasing supply of them. The number of unemployed has been as follows: January, 438,211 (1928) and 461,889 (1929); February, 413,383 (1928) and 489,347 (1929); March, 411,785 (1928) and 293,277 (1929); April, 356,795 (1928) and 257,603 (1929).

Warnings have been reiterated in the daily Press as to the slowness of savings, the progress of which is shown below:

As by far the greatest proportion of sums technically known as savings are deposited in the postal and ordinary savings banks (26,435 million lire out of a total of 35,313 at the end of 1928), it will appear that the increase has not been very great since 1925. If we take into account, however, the increased value of the money, the increase in the purchasing power of these sums will loom much larger. Probably it is this same increase in the purchasing power of the saving, which is responsible for the slowing down of the pace of the nominal increases, since margins for savings during a period of reduced monetary incomes are smaller. Another reason for the slackened rate of increment of saving is probably the increasing amount of direct investment by agriculturists, of which no trace appears in statistics, as savings are invested in biddings or cultural betterments by millions of small or medium-sized agricultural proprietors, none of them having recourse to agricultural loans or mortgages. Statistics of investments are published only in the shape of figures of capital subscribed to joint-stock companies new and old. Taking into account winding up and reductions of capital of existing companies, the number of companies increased in the first four months of the year from 14,609 to 15,213, and their capital from 44,961.2 to 46,483.7 million lire.

Following reports of the slump in the prices of wheat in the United States and Canada, a Royal decree increased the duty on foreign wheat from 11 to 14 gold lire. On the present internal price of 125 paper lire, the duty works out at about 40 per cent., or 66 per cent, on the price of foreign wheat duty bound.