Evening star. [volume] (Washington, D.C.) 1854-1972, 1930-01-01

dex of bu-'ness ac-
tivity in its pre-
John r. Sinclair. Urinary data shows
decrease of 8.3
points for the month of November. 1t
Is the largest month-to-month decline
in the history of that index. which
covers the entire postwar period.
D. w. Ellsworth, writing in the An
alyst, makes the statement that the No
vember decline, with four notable ex-
ceptions, lis probably the largest de-
crease in business activity which has
occurred in any one month during the
last as years."
These four notable exceptions &C.
CURED in the years 1893 and 1907, both
years OF severe business recession, fol-
lowing severe declines in the stock
market.
The Standard Statistics. another ALL
thority in this field, makes this state
ment:
Industrial production, as measured
by the Standard index, which is COR
rected for seasonal variation but not
for secular trend, experienced in No
vember the most severe recession wit
messed in any single month since May,
1924"
Automobile Production Drops.
Those industries which have shown
the largest drop in trade activity CEN
ter about automobile production, which
fell of $50 per cent in November as
compared with october; STEEL 1876 per
GEN., and that of cotton goods, Is per
cent. If the figures for November. 1923,
are compared with those for November
this year, we see that motor car pro-
duction was off 1876 per cent. Steel
down 17.6 per cent and cotton goods
of 1913 per cent.
The record for December Is probably
better than that for November, although
no figures as yet are available Should
the slowing down in business activity
for December equal that for November,
still the-record of production for 1929
will exceed that for 1928. The first six
months of 1929 were so extraordinarily
active that they made up for the grad
ual drop in the last six months.
Now, what of the future? What is
in store fer BUSINESS in 1880? No an
sWer TO any question Is more sought
after in these days following the most
extraordinary year in business history.
=, Across from my Broadway Office, in
the heart of uptown New York, there
is sign 100 feet long and 80 feet high,
occupying one of the most costly spaces
In the city, upon which the following
announcement appears:
Forward, America! Business is good
keep 1t good. Nothing can stop U. S."
Forecast Psychological.
Back of all business is confidence:
back of confidence Is psychology-mass
psychology in country as large as the
united States. The old saying that
prosperity lis 10 per cent credit and 80
per cent confidence" is more true today
IN our complex interdependent business
imam nv -, ~,
One of Americas leading economists
In replying to a question of mine as to
the outlook Of business in 1880 said that
any forecast, Ito be accurate. would
economic"
Then he continued: "Are we in a
new era again? That is to say, have
we discovered new method of con-
trolling psychology and influencing the
Expressions OF an effective majority of
the business executives of the United
States who hold in their control the
power to place or not to place orders
for equipment, labor and materials?"
Confidence and credit-these two fac
tors are at the base of all prosperity.
What about the confidence factor in
the situation for 1880? First, the
Hoover conferences have gone a long
ways to correlate business activity for
1880. The subsequent committee of
business men appointed by julius H.
Barnes, chairman of the board of direc-
tors of the Chamber of Commerce. Is
following up this work.
Some people believe that too much
publicity has been given to the White
House business conferences. Be that as
1t may, 1t Is now generally agreed that
these conferences greatly helped to re-
establish business confidence. The idea
Is not new one with the President.
Inc conference on unemployment
called by President Harding in 1921. I'M
der the Craftsmanship of the then Sec
rotary OF Commerce and now PreSi-
dent, Hoover, had the present situation
in mind In saying:
If all branches of our public works
and the construction work of our public
utlllties-the railways, the telephones,
etc.-could Systematically put aside
financial reserves to be provided in
times Of prosperity for the deliberate
purpose OF improvement and expansion
In times of depression, we could not
only greatly decrease the depths of de-
preston but We could at the same time
diminish the height of booms We
would, in fact, abolish acute unemploy-
ment and waSteful extravaganza. For
a rough calculation indicates that If we
maintain reserve of but 10 per cent
OF our average annual construction for
this purpose We could almost iron out
the fluctuations of employment,
Nor Is this plan financially imprac-
ticable. Under 1t our plant and equip
ment would be built in times of lower
costs than is now the case, when the
contractor completes with consumable
goods in Overlooking for both material
and labor"
The emphasis has been on construc-
tion-roads, bridges, buildings. rail-
roads-"the balance wheel in the pic
ture."
Confidence Restored.
In the last six weeks business conf
dence has been restored in the following
ways:
l. Henry Ford led the way by an
nouncing that his 10000 employees
would receive an increase In pay.
2. BY reduction in the income taxes
for this year OF approximately $780,
g. BY the railroad executives agree
ing to expend $l,050, 100000 in 1880.
OF which $l40,000,000 will be expended
In the first six months-more than in
the same period of 1929. These are
capital expenditures. Another $780,
100000 will be spent for supplies and
maintenance, while still another $3,000,-
100000 for wages.
4. BY public utility leaders ANNOUNCE
ing new capital expenditures of $685.
100000 in addition to l250O0,0o0 ON