The Waterbury Democrat., 1934-03-23
Market Had Very Dreary Session All
WiH Rising Prices
 Speed Up Recovery?
Upon Present Basis of Improvement 1920 Price Level
 Should Be Restored By the Middle of Next Year

war years is prerequisite to econ Omic debt structure.
 It seems obvious that. regardless of currency depreciation, farm prices can only be restored to semblance of normal by drastic ana permanent curtailment of produc- ton. The present factor of supply in relation to inadequate demand presents no easy problem for Washington's planners.
 The significance of the present price trend in relation to industry and business, to the volume of ac- tivity and the profits derived there. from, presents complexities and variations which defy generaliza- tion. One thing. however, stands out. As compared with the recover! cycles following all past periods of depression, the present recovery movement Is marked by certain artificialitics, the inevitable result of transition from almost com plete reliance upon the automatic fuDctioning of the capitalistic sys- tenn to managed recovery. After past depressions the normal &C., quence of revival was CD a decline in interest rates; CD advance !n high grade bonds; (3) advance in the stock market; (4) increasing business activity; (5) a gain in fac tory employment; (6) a moderate and gradual advance in wholesale prices; CD an advance in factory payrolls; (8) q gradual rise in the cost of living.
 The price and code situation de- veloped and developing involves shifts in the competitive positions of industries relative to other in- dustries and endless variations in the competitive positions of indi- vidual enterprises. Lumber, for ex- pie. fell to a disastrous depres- sion price, while brick and cemen; held at levels needing only volume to be profitable. Now lumber has advanced by far greater percent age than the other materials, even though 1t has only approximated the cost of production, while the other building materials are. def- nitely in the black at current lev els. Yet lumber competes with brick and cement and its competi- tive position is weakened by higher prices.
 It appears obvious that, as gen. erality, prices in most lines have tended to run ahead of consumer purchasing power. It is also true that in many instances the NRA code is being used by the short sighed as @ means of enforcing un- justifiably higher prices.
 Faced with increased costs and the fear that offsetting prices sufh- cient to yield a profit will curtaiI public demand, individual concerns are confronted with quandary of no mean proportion. Yet the quan- diary is not less serious in it's over all economic implications for us all When the present emergency fed eral spending in the cause of re- covery Is ended, as 1t inevitably will be the question will be whether consumer income can catch up with rising prices and keep in step thereafter. If 1t can, well and good. If it doesn't, prices will necessar- fly stop rising and costs will have either to be lowered or. in many businesses, absorbed at the expense of profits.
 In the United States there is no shortage of goods today and no shortage of productive facilities. There, has been no significant in- fiaion of the currency and so sig niflcant public flight from the cur rency. The governments credit Is secure-so secure that to most cit- iZens the dollar persistently re- mains q dollar despite the govern ment's solemn assurance that as result of a magic change in the amount of the hidden and unseen gold behind 1t, 1t should really be worth only 53 cents. As the difficult ties multiply, perhaps we will be content with a price level, substan- italy under that of 1926.
 oca seaOn Onphznpdphtvx