Daily Kennebec journal., 1925-01-01
new YEAR PROSPECTS
H00VER'S FORECAST
FUTURES PROMISE

Washington, D. c., Dec. Sl-Secre-
tary Hoover in response to many re-
ouests for a statement upon the eco
nomic prospects Of the new year,
stated today:
"A forecast of the business future
must be simply a weighing OF the
economic and political forces IN mo-
ton. The annual survey of the De-
partment OF Commerce shows that
/ the New Year begins with the eco
nomic structure of the world upon
more solid foundations than at any
time since the war. With the eXcep-
ton of n few spots of secondary im-
portance there has been during the
past year real advance toward So
cial. economic, and political stability
| throughout the world. The only eX-
ceptions arc Russia and China. which
even before the war contributed less
| than 3Ia per cent of internationa
commerce and of course a part of
| this continues. Generally the world
| Is producing more goods, there Is
fuller employment. there are higher
| standards Of living, more assurance
| of economic stability for the future
and more promise Of peace than we
! have seen for many years. The world
/ IS by no means free from liability to
economic shock, yet the forces today
| in motion all tend to great promise
for the forthcoming year.
| In our own country the outStand-
| ing economic development of the
year has been the very large recov-
cry in agriculture after its two year
! lag behind the recovery Of industry
| The farmers have large measure
oc losses in the last three years yet
to recover, but their outlook is en-
cOuraging. There arc some second
ary difficulties still remaining, par
ticu.arly in the cattle industry and
the effect of the suh-normal corn
crop; but the prices Of all farm pro-
ducts arc gradually moving toward
the general average of commodity
prices. This Improvement i'll prices
of farm products has been paralleled
with some decrease in the prices of
many industrial commodities, such
as fuel, building materials, metals
etc. 50 that there has been little
change in the average of all price
levels, and thus the farmers pur-
chasing power is being rcmedied in
both directions.
of adjustment in prices of single
commodities during the year, the av-
| crage wholesale price of all commod-
| tiles has varied but 3 per cent as
! between the ends of the years 1922
1923, and 1924. 1t would thus appear
tina: we are tending to the common
+ level in prices of about 80 per cent
! over prewar. which seems to repre-
sent ut least our present economic
plane in prices.
I The average wage in industry has
been stable during the last year. and
remains around 100 per cent above
l prewar. while the cost of living has
maintained almost exactly the same
level at the end of each of the last
three years. 1922, 1923 and 1924, about
12 per cent over prcwar. Our labor
therefore. continues TO enjoy the
| highest real wage in its history There
was some unemployment in the mid
die OF the year but it has now been
largely overcome.
While there was some slackening
of manufacturing production as q
whole in the spring due in part to
the uncertainties of election and In
part to reduction of accumulated
stocks, Yet there was but little slack
oning at any time in consumption Of
ma ior articles as shown by the con-
tirued high Levels of car loadings. Of
sales of wholesale and retail estab-
liShmcntS and of construction actiVi-
ties. The end of the year finds us
with recovered industrial produce
tiOn n practically the same levels as
q year ago.
Two industries textiles and
-
recovery. The textiles are suffering
in part from sharp competition of
foreign imports. and in part from
I shift in national habits. An improve
ment may be looked for in the forth
coming year. The condition of the
bituminous coal industry in the
northern states is unsatisfactory ow
in- to the unusually large stocks ac-
cumulatcd early in the year rs q
safeguard against possible strikes;
to the decrease in industrial con-
sumption during the middle of the
year; and TO the increased propor-
tional production of tho southern
states due to lower wage levels. The
difficulties in this industry created
by strike stocks and mid year dip in
Industrial activity should soon be
overcome.
The construction work Of the
country has maintained high activ-
ity. While the shortage particularly
of housing and business buildings.
due to the cessation of construction
during the war, has been to large
degree overcome, yet continued high
real wages and general prosperity
create n demand i'll excess of that
due only to increasing population,
because of the insistence of a popula-
ton of rising standards Of living. for
more elbow room and better hous.Sy
generally.
One striking factor in maintenance
OF increased construction activities
Is the effect which the automobile is
producing in increasing the demand
Tor road construction and in causing
migration of population in many of
our towns to new housing in the
suburbs. Another effect of these
forces is to maintain rents out of
line above the general price levels
Win our high real wages and lit
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