The gazette-times. [volume] (Heppner, Or.) 1912-1925, 1922-07-06
Community Service

the banking situation than in the field
of production and trade. This was to be
expected. Not until the strengthening
of the credit structure had made con-
siderable progress was the basis laid for
any marked degree of general industrial
revival. Meanwhile, production costs in
many lines were considerably reduced,
due to somewhat more reasonable wage
scales and lower prices for raw mater
| ials.
In addition to the increasingly favor
able position of the banks as a whole.
an expanding volume of production,
greater than can be accounted for by
seasonal variations, has been sustained
for some months. This Industrial pro-
gress, following as it does, prolonged
period of credit liquidation, has substan-
tial basis for continuance.
Prices Seek the Normal.
A favorable factor of major signifi-
canoe is the course of commodity prices
in recent months. For nearly a year
average wholesale prices have been fair
ly constant. Individual prices, it is
true, have fuctuated sharply in some
| cases, but the chief movements have
been such as to reduce the wide dispar-
tiles in relative levels. The appreciation
in the value of cotton, grains and other
agricultural products, for example, has
done much to restore the balance be-
tween the buying power of the farmers
| and that of other elements of the busi-
ness community. In turn, banks in the
| South and West have benefited greatly
| either through the actual liquidation of
loans or increased assurance that GUS
toners will be able to meet their obli-
cations. The comparative stability of
general wholesale prices for nearly a
year, has induced a marked degree of
confidence that for some time present
price levels will be sustained, or, at
least decline, if at all, gradually. This
is reflected in an increased volume of
forward buying.
| The pronounced building movement
throughout the country is both a cause
and an effect of better economic condi-
tions generally in the United States.
Likewise, the recent improvement in the
automotive industry is more or less
symptomatic of business conditions as
a whole.
1t is also Of considerable significance
that the railroads are preparing for in
creased business activity, as indicated
by the number of freight cars and loco
motives contracted for thus far this
year. Orders for equipment have recent
y been unusually heavy.
That we have passed the peak of bus
iness readjustments is evidenced by the
gradual but steady decline in the num-
Der of commercial failures and the am
cunt of liabilities involved.
Production Stimulated.
The prolonged period of sub-normal
production in most industrial lines has
permitted the utilization of accumulated
stocks Of commodities. In consequence
current consumption needs are stimulat-
ing further production.
Business improvement, however, re-
mains spotty Moreover, productive ca
pacity in many lines is considerably in
excess of consumption requirements.
Necessarily such condition will be dis
turbing factors for some time to come.
There is clearly foreshadowed period
Of intense competition, domestic and in
ternational. The recent instance of COM
petitive downward revisions of certain
ocean passenger rates is a case in point.
Corresponding competition for survival
by domestic units is inevitable.
The fear, voiced from time to time in
one or another quarter, that our huge
gold reserves and the remarkably strong
position of the Federal Reserve banks
will lead to a period Of secondary in
fation," has been intensified by the re-
cent trend of the stock markets. Never
theless, there is ground for confidence
that the Federal Reserve Board will di-
rect its activity in such manner as to
discourage undue speculation in COM
modify markets. This confidence is es-
pecially fortified by the indication of a