The Sauk Centre herald. (Sauk Centre, Stearns County, Minn.) 1886-current, 1931-01-01
BUSINESS OUTLOOK
FOR 1881 HOPEFUL
Secretary of Commerce La
mont Gives Interesting
Detailed Statement
RECOVERY TO BE SLOW
Year Closed With Agriculture
al Prices at Lowest Level
Deposits Increase


wide decline in raw material prices
and a collopse of security values
ushered in a period of general bus
mess unsettlement. In the latter
months of-the year production was
curtailed, building fell off, and in
dustrial employment was reduced.
But many evidences of business i'm
provement appeared in the early
months of 1880. Building construc-
ton increased and there was an
upturn in the production of auto
mobiles, steel and other basic pro-
ducts. Security prices swung up
ward and commodity prices were
temporarily halted in their decline.
Toward the middle of the year,
however, it became clear that pro-
duction in certain raw material
areas had been setting too rapid a
pace and that economic disturb
ances in several quarters of the
world would enforce further de-
clines and lessen still more the
purchasing power of important
world markets At home the early
evidences of stability gradually be-
gan to disappear beneath the cur
rents of worldwide depression.
while a period of severe drought
gave still greater momentum to
those cumulative forces which were
bringing heavy losses of purchas-
ing power to substantial portion
of our people.
AS the rate of decline in raw
material prices became more high
ly accelerated industry confined it's
purchases more and more to cur
rent needs. The universal drop in
industrial productions was follow
ed by increasing unemployment and
a decline in consumers demand in
both foreign and domestic markets.
Toward the end Of the year these
cumulative forces were rapidly run
ming their course and the apparent
retardation in the rate of down.
ward movement in several basic i'm
dexes Of business supports the be-
lief that the elements of recession
have now spent most of their.
force.
The effect produced by the world
wide depression can be seen in the
years indexes of business. The
Federal Reserve Boards index of
industrial production, which COM
prises all the basic mineral products
and all important groups of manu-
featuring goods and which there
fore, is the most comprehensive
single measure of industrial activ-
ity, fell approxin ately 20 per cent
below the level of the preceding
peak year. Compared with the
highly prosperous year of 1928, how
ever, the decline in production is
slightly less than 13 per cent.
Exports of manufactured goods as
well as total exports declined in
value approximately Is per cent, re-
flecting lower prices and the mark
ed shrinkage in purchasing power
abroad which followed upon the
rapidly weakening price levels and
the universal contraction in in
dustry. Also significant in this
connection is the fact that our
capital exports during the second
half of this year have shrunk to
negligible proportions.
On the basis Of quantity our ex-
ports for the current year have de-
clined about 20 per cent from last
years high levels. Imports, which
fell off approximately 80 per cent
in value from 1929, showed a drop
in quantity of only Is per cent
Thus our purchases and consump-
ton for foreign goods have fallen
but little below the levels of pre-
vious normal years. This great dis
parity between the value and guam
tity of our imports reflects the
drastic price declines in raw mater
ials, semi-manufactured products,
and foodstuffs, which constitute
approximately two-thirds of our
total import volume.
While the forces of contraction
were running their course the Sc
verify of the movement was hap
PLY tempered by certain ameliora-
tive factors. Last year, Immediate
ly after the stock market crash,
the President called a conference
of bushes and labor leaders with
a view to effecting the greatest
possible degree of cooperation dur
ing the period Of readjustment. The
successful outcome of this and Of
later conferences is reflected in the
almost total absence of Industrial
disputes during the present year
and in the maintenance of existing
wage levels. Disturbances such as
characterized previous periods of
depression have not arisen this
year, although the contraction Of
purchasing power and declining
price levels have resulted in the
curtailment of industrial operations
and the consequent discharge OF
many workers. For the year as a
whole factory employment was
about Is per cent below the high
levels of the preceding year, but the
decline in the number employed
during the current year has been.
relatively far less than in similar
preceding periods Of depression.
Employers have evidenced a con-
scious determination, so far as pos
sible, to maintain their working
forces by distributing available
work through part time.
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