Arizona republican., 1920-05-31
RELIEF FROM HCL SEEN
 IN REDUCTIONS
Federal Reserve Board Says Underlying Causes of High Prices Have Not Yet Been Removed - Labor Disturbances Have Ten dency to Uphold Level
TRepublIcan A. p. Leased WlreI

WASHINGTON, May 30 Despite the recent reductions in prices, little relief from the general reign of high prices is seen by the federal reserve board in it's analysis of May business conditions, made public tonight
 The board expressed the view that there has been no change in the under lying conditions responsible for the high cost of living.
 Asserting that while 'store sales and a tendency to lower prices bear witness to the presence of ''disturbing factors which suggest the advent of widening in price levels, the board de- clares it cannot accept the situation as a whole for it's face value. The explanation is. added that there has been only a slight increase in produc- tion and there is no greater disposition on the part of the general public to economize and invest than had ruled heretofore.
 Freight Jam Has Effect
 The changes that have taken place therefore" the boards analysis said, cannot be looked upon as indicating modification of underlying condi- tions. They may. however. afford a basis for changes in business relation ships that may broaden into more far reaching alterations of the essential price structure.
 Business in every section of the country has suffered considerably from the freight jam, which has prevented normal movement of products to mar kets. The effects of the tie-up are no ticed in the agricultural districts as much as the industrial areas. and the farmers are not the smallest class which has sought more bank help in the way of credit as a result.
 Results of the boards action in the nf a ly.faq q has begun to be evident. according to reports of the various reserve banks. In addition 10 q general reduction in the value as we'll as volume of secu- rities traded in the financial centers, there has been a general revision of interest rates affecting both commer- eial paper and call money. is is stated.
 Labor Disturbing Element
 The labor situation during the month has been one of the outstanding ele- ments of double difficulty and is one Of the larger problems with which the country is expected to have to deal the rest of the summer. In addition 10 in tense shortage of labor on farms and at other points of primary production, sporadic strikes have occurred in many lines of manufacturing, notably the textile industry, indicating in the boards view, continued unrest
 Wages apparently have fallen be-
 
 Of living the statement continues. The movement of labor from farm to city is continuing. Various demands for higher wages have been taken un- der advisement for the purpose of bringing about compromise adjust ments. General complaint of low eff ficiency or small output per unit of labor is prevalent and the difficulty Of getting skilled labor in some of the more highly developed lines of manu- facture is now very considerable
 The disturbing factors have ma terially affected many lines of manu- featuring although general manufac- turing continues in substantial volume. Cancellations of orders in both cotton and wool. by the jobbin~ and retail trade, have not yet reached large pro- portions, but they are already notice able"
 This has resulted in some manufac- turers being forced to make conces- sions to retailers who were described as being ''as being quite unsettled" :" The same situation was said to o5- tain in the leather trade.
 With respect to conditions local to the various reserve districts, the re- view said:
 Existing Conditions Analysed
 NO. l (Boston). There is noted a trend toward greater discrimination and economy in buying. but there is also noted very great difficulty in the way of actual defIation.
 No. 2 (New York). Price reduc- tions are noted in retail stores. A growth in the cost of doing business. great reduction in securities prices. but
 Continued on Page Two).