Wholesale Price Variations – Cost of Living -Improving Public Finance – Public Debt
Tipologia : Paragrafi/Articoli
Data pubblicazione : 09/02/1924

Wholesale Price Variations – Cost of Living -Improving Public Finance – Public Debt

«The Economist», 9 febbraio 1924, pp. 251-252

 

 

 

Turin, January 28

 

 

Average wholesale prices have increased a little in the month of December, as the new Milan Chamber of Commerce’s index (basis 1913=100) shows:

 

 

 

 

Average

May-Decem

1921

Average 1922

Jan.

1923

April.

1923

August

1923

Dec.

1923

Average

1923

Vegetable Foods

516-8

555-2

546-5

567-1

515-3

497-9

533-9

Animals

649-4

587-4

531-6

570-6

562-5

588-8

566-8

Textiles

480-1

533 1

618-9

656-3

651-7

743-9

673-3

Chemicals

440-1

437-2

407-3

525-9

427-8

4100

421-6

Minerals and metals .

514-4

524-1

525-6

570-9

544-3

548-2

547-7

Building materials

570-3

519-7

529-9

519-4

517-6

531-6

519-0

Miscell. vegetables

499-5

508-2

560-7

598-1

429-8

459-1

515-9

Miscell. manufactured

537-5

535-8

534-5

533-8

541-9

529-6

554-6

General index

516-5

529-3

523-5

549-7

527 0

534-8

535-8

 

 

I have quoted for 1923 the opening and the closing month and the intermediate minimum (August) and maximum (April). The average for 1923 is slightly higher than for 1922, and therefore the purchasing power of the lira is lower. The greatest increase was in the textile group, owing to international change in the prices of cotton, wool, and silk. Cost of living was also slightly higher in 1923. The Index number of the cost of living in Turin of a working family of two parents and three sons, taking the average for the first half of 1914 as 100, is as follows:

 

 

 

Food

Clothing

House

Rent

Heat

and Light

Miscellaneous

General

Index

January, 1920

. 3510

327-2

100

406-5

344-5

318-5

July,         “

. 409-3

479-0

100

4150

455-8

384-4

January, 1921

. 5131

547-3

110

527-3

513-6

467-4

July,        “

. 446-2

411-4

110

354-2

537 1

404-7

January, 1922

. 523-7

454-2

120

435-3

590-7

465-6

July,        “

. 487-3

432-6

120

365-3

584-1

436-9

January, 1923

. 4990

432-6

120

423-4

574-4

446-0

July,        “

. 498-0

434-6

200

376 1

580-0

453-6

December, “

504-7

470-3

200

4600

577-3

466-6

 

 

The hardening impression is confirmed by the annual average, which were for the general index 337.73 in 1920, 449.19 in 1921, 448.09 in and 451.59 in 1923.

 

 

Public finance is improving. The Finance Minister has suspended the issue of Treasury bills for six months or less. The current income for the first six months of the financial year (July to December, 1923) was 8,546.6 million lire, against an estimate of only 7,832.3 millions, or an increase of 732.3 million lire, while the expenditure was 8,771.2 millions, against an estimate of 9,362.5 million lire. It was thus possible to limit new debt and to begin making a reduction among various kinds of debt. A comparison of public debts at June 30, 1923, and December 31, shows that a net reduction of 234 million lire has been effected in internal debt in that period.

 

 

The outstanding external debts are exclusively towards the Governments of the United States (8,536.8 million lire) and Great Britain (13,858.4 million lire).

 

 

This item of external debt is the only remaining stumbling-block in our public finance, as it means a paper debt of about 90,000 million lire, or more than the whole internal debt. Public opinion is increasingly leaning toward the old idea of the contemporaneous adjustment of inter-allied debts and war reparation. The recovery of our national finance would be otherwise impossible.

 

 

There has been in the last six months an increase in long-dated loans and bonds (war indemnities loan dated 25 years and nine years Treasury bonds), and a decrease in short-dated Treasury bills. The volume of these latter is too great, but it is hoped that by not reissuing bills of less than six months’ currency the total will become more manageable. Italian Bourses have greeted with enthusiasm the news of the suppression of the issue of short bills 5 per cent. Consols, which opened the new year with a quotation of 89.28 per cent, close to-day at 92.95, and 3.50 per cent, old Rentes rose between the same dates from 76.79 to 80.80. Bourses are very animated, and great advances have been made not only by fixed-interest securities, but also by variable dividend shares.

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