Arizona republican., 1922-06-15
BUSINESS IS COMING BACK
AND PROSPERITY IS IN SIGHT

States was 1917. This is new high
record. The greatest number in any
previous quarter recorded in the first
three months of 1915 during the first
year of the war, when the total was
7,2f6.
The record breaking volume of
business mortality confirms the
statements TO the effect that we
should expect increasing numbers of
insolvencies when industrial produce
ton picked up and business began to
recover. 1t has been repeatedly noted
in the case of earlier depressions
that increasing industrial production
coincided with increasing business
troubles and many firms that had
been able to survive through the
inactive months of depression found
themselves unable to take part sue
cessfully in the highly competitive
period that followed. 1t is generally
true OF American business that in
years of great prosperity we make
our debts, in years of depression we
pay our debts, and then il our busi-
nesses survive, we start again. The
thousands of firms that have failed
or will fail in the coming months
are largely those that made their
debts when times were booming and
found it impossible TO pay them when
times were hard.
Interest Rates Reliable Indicators
The course of interest rates in such
periods as these is one of the most
reliable indicators of what is happen
ing in the business world. As the
period of prosperity preceding the
depression eliminates, costs of in
dustrial production and business OPP
Grafton increase so much as to reduce
profits. AS result manufacturers
cut down production and endeavor to
secure prompt payment of outstand-
ing accounts. During this period
money rates advance.
Later on, as debts are paid and
business slows down, idle money
accumulates and interest rates fall.
At such times production is low,
profits are cut into or disappear,
failures are numerous and unemploy-
ment is seriously prevalent.
When these conditions have main
tained for short time enterprising
and courageous men take advantage
of the prevailing low rates of interest
to purchase equipment and undertake
construction that will eventually be
needed in their businesses. and that
can now be secured at lower costs for
money. labor. and materials than
would have been possible in the pre-
ceeding periods of prosperity.
THIS is TAKING PLACE NOW.
INTEREST RATES ARE Low AND
PRICES AND WAGES ARE GREAT
lily REDUCED FROM FORMER
| LEVELS. THE RAILROADS ARE,
b UYING. CONSTRUCTION II
BOOMING, PIG IRON PRODUC-
| TION is RAPIDLY INCREASING.
THE COUNTRY IS EMERGlNG
FROM THE DEPRESSION-PROS-
PERITY is IN SIGHT.
What The Leaders Say
judge Ebert n. Gary, Chairman OF
the Board, United States Steel Cor,
| poraton has this to say: lron ana
steel. it is said. are the barometers OF
| the nations business. Today the out
| look in this industry is better than It
| has been since the early part OF l9zl.
when the business boom following
upon the close of the war collapsed.
| Lasting business prosperity basea
| upon sound principles and investment
| is not far distant. Already we can
safely say that the peak of the de-
preston has been passed. The ena
! OF this year or sooner should marx
the approach of business health that
will be lasting and not ephemeral
| Euqene Meyer. Jr.. Chairman OF the
War Finance Corporation, following a
| tour of investigation in the import
ant agricultural states. says: The
severe and indeed unprecedented de,
| preston which dealt such nara
blow to the agricultural interests IS
in some sections of the country, al
ready a thing of the past In other
sections 1t is rapidly passing. Every
where hope and confidence are taking
| the place OF despair which SIX months
ago was so widely prevalent,
, Alvin Hunsicker, vice president anc
! general manager, Standard lexsiie