Evening star., 1926-10-02
BY THOMAS S. HOLDEN.
Fic5 President in Charge of Statistics.
w Tndca N

Fice President in Charge of Statistics.
F. w. Dodge Co.
The business cycle isn't what it
used to be. 1t is the victim of it's
own folly. 1t has permitted itself to
be caught, isolated, analyzed dis
ssected in a thousand laboratories,
mapped plotted and charted ad in
hnltum. AS Il result, ii has lost much
of its old time potency as a regu-
lator and prognOSticator of the ups
and downs of prosperity and depres-
sion.
1t has permitted it's habits and
characteristics to become generally
known, and has thus given into the
hands of it's enemies the means of
avoiding it's effects. BY giving us
the understanding of it's advance
warnings of maladjuStments and un-
healthy tendencies in business, 1t has
given us the means of correcting the
Embellishments and unhealthy tend
encies before they result in serious
or widespread harm In addition to
permitting this almost fatal famili-
arity with its inside workings, it has
In the recent past received a knock
out dose compounded of augmented
wealth, increased national income
and stupendous and widely dis
tributed prosperity
One interesting modification of the
business cycle can be seen in the
postwar construction record for
New York City. Since the war, the
old style 40-month cycle has changed
into a 24-month cycle. The end of
each odd-numbered year G919, 1921.
1928 and 1920 has been the crest
OF wave of construction contra ct
letting, and the ends of the even
numbered years have all been periods
of relatively low building volume
This tWo-year cycle has up to the
present been observed only in the
records of New York. 1t may be
temporary. or 1t might conceivably
develop later in other sections of the
country. Apparently, it will work
out this year, giving a reduced vol
ume of contracts for New York City
In the second half-year, as compared
with the first half.
Fall Upturn Feature.
Another shift in the business cycle
has been the tendency toward an
uptlirn in construction contract vol
ume in the Fall months of each year,
after slackening in the Summer
This has taken place in each of the
past five years, and appears to be
taking place at the present time.
Last year the Fall upturn started a
couple of months earlier than usual
and took on the proportions of full
sized boom.
The contract totals for the three
calendar years did not vary greatly
from each other. The writer esti-
mates the entire countrys contract
Of
100000 for 1919, $3.33S 900, 100 for
1920 and $3.069. 100000 for 1921. In
1920 there was a 6 per cent increase
over 1919; in 1921 a decrease of per
cent from 1920. During the three
year period the monthly contract vol
umeS averaged around $3.50, ,000,0 900.
This figure may be conveniently con-
sidored as the normal monthly con-
tract volume for the United States
during the first phase Tor first three
years. of the postwar era.
During this entire first phase, with
its violent fluctuations between boom
and depression, its hysteria of infla-
ton and subsequent panic, there was
present a condition which became the
principal stimulus to the development
of the second phase of postwar con-
struction development. This was the
building shortage. 1t was only after
tne JbuGSdIlNe processes OL tclEttlCu
and depression that took place In the
first phase that the country was ready
to make real progress in catching up
on the shortage. The revival of build
ing that started in the middle Of 1921
was carried forward with q gathering
and increasing momentum. The year
1922, with recovery in full swing, had
$4,330, 100000 worth of construction,
an increase Of Al per cent over 1921.
It is to be noted that this big jump
took place in the transition period be
tween the first two phases of the
postwar era.
Second Was Expansion.
The second phase of the post war
era was the period Of growth, eXDan-
sion, Of catching up with the short
age. 1t consisted Of the years 1922.
1928 and 1924. Beginning auspiciously
in 1922 with a construction volume OF
1890. 900, 900 with it's Al per cent in
crease over 1920. it continued into
1923 with a total construction volume
of $4,76S, ,0O0.0 900. and into 1924 with
a years total of $5,237. 100000. Com
par-ing these years with the years of
the first phase. with their monthly
contract average Of S265, 900 900, we
note that 1922 averaged 1861 900, 900 a
month: 1928 had 1897 900 900 a month,
and 1924 had $436 100000 a month.
Thus the second phase was period
Of steady growth in construction
volume. stimulated by the existence of
an unusually heavy building demand,
which was oCcasioned by real short
age in the necessity construction re-
ouirements of the country. One re-
suit of this continually enlarging ac-
tivity Of the years 1922 through 1924
was the wiping out of the shortage.
For, taking the country as a whole,
all pressing necessity building. re-
Quirements had practically been
caught up with by the end of 1924.
An even more important result,
from the point of view of present
conditions, was the very considerable
expansion Of production facilities for
construction that accompanied the
rapid growth in building volume.
New Finance Methods.
Perhaps the most conspicuous ad
vance in construction facilities was
the Widespread growth in new meth
odS of financing construction projects.