Evening star. [volume] (Washington, D.C.) 1854-1972, 1931-11-25
HOPEFUL BUSINESS
FORECAST IS MADE
Signs of Recovery Are Al
ready Apparent, Says New
| York Economist.
BY VICTOR EUBANK,
Associated Press Financial Writer

~
NEW YORK, November 25.-Ameri-
can business is already showing signs
Of convalescence and 1882 may point
the way to comnlete recovery. in the
opinion of Paul MaZur, prominent
economist, as expressed in his latest
book, New Roads to Prosperity; the
Crisis and the Way Out" WHICH is to
be published next month.
At the same time Mr.. MaZur, who
Is a partner of the New York banking
firm of Lehman Bros, points out that
1t is conceivable that conditions might
make it necessary for the United States
to follow England in checking gold
exports.
But the banker-economist is highly
hopeful for the future and states his
definite belief that unless some I'M
toward event, like a physical disaster,
or a radical social upheaval, or COM
plete loss of faith nthe banks, inter-
venes, 1882 seems destined to be a year
of convaleScence of the world back to
the l926-27 status of reasonably good
business"
Criticizes Capitalism.
Mr.. MaZlr, although listed in the
capitalist class himself, does not let
this fact deter him in sharp criti-
cism of capitalism
allowing itself to grow up like Topsy-
without order, without control, with
out regulation. There has been no
intelligent ALLEGATION of capital no es-
tablishment of fundamental forces OF
control; in fact it is the brutal truth
that in this respect there has been no
evidence of any understanding OF tne
Importance of foresight and concerted
action"
The writer, however, Is not disheart-
aned and believes that "unquestionab
we shall muddle out Of the mess some
how. if political leadership does not
interfere too stupidity with the action
of the economic forces involved"
Mr.. Mazur is OF the opinion InaS
NAV very we'll prove to be the last
dramatic act of the deflation phase OF
the present cyclical depression"
He adds that 1.-The artificial support OF
the gold standard of sterling was the
most striking anomaly Of the second
half of 1881, and almost Immediately
favorable effects were noted when Eng
land departed from the gold basis,
In discussing the possibility OF the
United States following in the footsteps
of England, which he believes is not SO
fantastic as it appears in the light OF
the large gold supplies OF the country,
Mr.. MaZur says:
European Exchanges.
"The depreciation Of European ex-
changes threatens America with the
loss of foreign markets and with in
creased competition in domestic mar
kets. America might seek to insure her
competitive position against foreign ex-
ports by following England's example
and abandoning the gold standard OF
exchange.
Historically, cheap money has al
ways sought successful exchange Tor
more expensive money If Substan-
tial portion of the world should depart
from a gold basis, there would be set
on foot a decided movement to ex-
change large sums of nat money for
American gold. Moreover, since coun-
tries with deprecated currency would
have increased attractiveness as mar
ketS for world buyers, the actual exports
OF America might decline imports
would then increase and the resulting
adverse balance. would create drain
on the gold Of the United States.
This would be particularly true II
efforts within America to reduce costs
through increased efficiency were not
sufficiently successful and II wage re-
auctions were met with increasing and
effective resistance from labor.
There are many who gauge the Sc
curity and wealth of this country by the
gold reserves within the vaults Of the
central banks. Serious inroads upon
these reserves such Is were Just de-
scribed would unQueStionably call forth
some protective measures, and the OBJ
vious method would be a refusal to
honor foreign. drafts in gold"