The Washington herald., 1922-05-29
PROSPERITY TALK
In new ENGLAND
BASED ON HOPES
Industrial Activity Due
To Buying of Middleman
Against Future Needs.

BOSTON, May 2S.-This section.
like the rest of the country. is at
present banking rather heavily on
the future. Signs of Industrial ac-
ttvity have unmi istakably increased
In not few lines. but more In an
ticipat'on Of what middlemen think
business is going to be some months
hence than in response TO any ma
terial increase in the current de-
mands of final consumers. The
whole situation. in short, wears a
highly conjectural appearance.
Our producers are quite alive to
this fact. Tht Ugh in many cases
they have been selling goods more
freely of late, they are not putting
much new money into the mainte-
nance and operation of their plants.
their belief APPARENTLY being that a
bird In the hand Is worth two in the
bush.
Machinery Trade Active.
One of the most interesting signs
at the moment is the increased ac-
tivity of the machinery peoeple.
Concerns whose plants have been
out of operation a great many
months are now moving goods. They
are selling from stock, which in
many cases they can apparently
continue to do for some time with
out putting their works In opera
ton. Certain of the large machin-
cry shops that have been running
continuously snce 1920, but with
Insignificant operating forces have
of late enlarged the number of
their hands. Still, II Is doubtful II
they are running at so per Genet OF
normal-they are running at inf
nitely less than that percentage Of
their wartime, peak.
As one of our bankers says, this
is the bluest spot in the country.
Our business men come back from
other sections and report a much
greater optimism than Is felt here.
This kind of talk is heard from
shoe manuacturers. as well as rom
the textile people. 1t seems to be
based on the idea that our cost Of
production is. comparatively speak
ing, too high. II cotton manufac-
turer tells you that he contemplates
enlarging his plant you cannot as
sumo that he will build his exten-
sion alongside of his existing prop
erty. for he Is quite likely to tell
you when he builds 1t will be in
the South.
Immediate Profits Likely.
In a word. though much Is said
at the moment about increasing
business on the part OF our indus
tries, 1t seems to be a fact that our
industrialists are not looking for
much in the way of profits in the
very near future. One of our bank
ers, indeed, recently remarked that
if our industries could run for the
next few years and meet their In
terest charges and their deprecia-
ton. that would be about all they
could expect.
This is an extreme remark, ana
1t is quoted merely to indicate what
there is reason to think is the real
sentiment in this section, as COM
pared with the professed sentiment
in other sections.
The liquidation OF industries Is
going on apace here. aAI is prob
ably made somewhat easier by the
current talk about general business
being on the upgrade. This talk
has apparently got on the nerves or
middlemen and has speeded up
their purchases. They feel that
they cannot afford to be caught
without goods a few months hence.
and they are.e of coursee, Influenced
by the rising tendency of raw ma
teriAls These rising costs aHs
necessarily proving somewhat per-
picking to manufacturers To meet
them they have to mark up the
price OF the finished goods in face of
the fact that final consumers are
about as st:ff-neceked in the matter
of prices as they have ever been.
VIII Consumers Buyf
The future is therefore awaited
with great interest. II final con-
sumers continue recalcitrant, the
present modified boom in industry
may prove disadvantageous rather
than otherwise. Stated briefly, the
thing which our conservative bank
ers and industrialists think most
essential is an increase In economic
demand; whereas, as matter or
fact. the effort of about everybody
now is to create the means of meet
ing the demand before the demand
itself is created. There must be
purchasing power before there are
purchases and there are as vet no