The New York herald. [volume] (New York, N.Y.) 1920-1924, 1920-10-01
BANK EXPECTS NO
LONG DEPRESSION
National City Says Too Much
Work in Sight and Crop
in Barns Too Big.
PRICE BOOM HAS PASSED
Reductions Have Gone About
as Far as They Will in Near
Future, Is Asserted.

That too much employment is In sight
in this country and too big a crop in
barns for a prolonged period of depres-
sion is the opinion of the National City
( Bank, which says in its monthly letter
issued to-day that in industries most
disturbed price reductions have gone
about as far as they will go in the near
future and that some prices which have
| dropped to prewar levels may recover
rart OF their lost ground. Discussing
/ general trade and industrial conditions
the bank says:
1.-THE developments of the month have
strengthened the general conviction that
| the boom period in prices is over and the
country settling down to conditions more
normal than those which prevailed in
the last half of 1919 and the early
months of 1920. The day of competition
among dealers for goods at any price
and among employers for laborers at
any wage has passed.
There Is good buying power In the
country yet. but the keen edge is off
The feeling IS that from now on there
Will be enough of everything to go
around and that most things will be
cheaper rather than dearer, all of which
is good reasoning. War conditions do
not last always. Imports in the first
100000 against S1,954, 100000 In the
slime months of last year. The crops
are large and the cost of living lower
than last year. The argument for wage
increases based on the cost of living
works both ways and the argument Of
diminished demand for goods and di-
minished employment is one Of the most
convincing in the world 1t cannot be
answered or put aside. 1t looks every
body in the face until something is done
about it,"
The bank reports small percentage
Of unemployment and says that the per-
centage is not likely to increase. It
makes that point despite the fact that
a large number Of wage earners have
been laid off in the tire factories, shoe
factories and textile mills and that loca'
trade has been affected to some extent
thereby. 1t is also pointed out that pay
ments through banks are about on
level with those of a year ago. and
throughout the West there Is entire con.
fidence in the future. The railroads
handled more freight in August than
they did in any other August. Discuss
ing factors that may check the down
ward price movement, the bank said
There is good reason to think that
in the industries that have been most
disturbed the price reductions have gone
about as far as they Will in the near
future. Other Industries must expect to
contribute their share in the general re-
adjustment, and the more readily they
do so the better all around. These
price reductions have not yet been re-
Elected in retail prices everywhere. but
that, too. is development on the way
and which the enterprising, public spir-
tied merchant will want to hasten.
There is always difficulty in man
aging downward movement. Once
| confidence in prices is unsettled suspicion
is alert Buyers are wary at any price.
IL is a mistake, however. to think that
prices-at least the average of prices
may slump back to anything like pre-
war figures. They have almost done so
in some lines. but these prices will prob
! ably recover part Of the lost ground.
There are too many factors in the situa-
ton to permit Of complete readjustment
at once. II will be "a time process.
THE business community does not
like the idea of doing business on a de-
clining market. but that is the prospect
fer some years to come. and business
rust plan for Il. Where retail prices
reflect all the reductions that producers
have been obliged to take the cost of liv-
ing will be materially lower than It was
at the high point. but It will still be a
long way above the prewar level. II is
| not certain that all Of the recent reduc-
tons can be maintained this is the sea-
son when food Is cheapest. a fair start
has been made, and a revival Of activity
in the trades most affected is desirable
and probable We adhere to our opinion
that there Is too much employment in
sight in this country. and too big a crop
in the barns. for prolonged period Of