The Washington times., 1934-03-20

ernment spending and price lift
ing are still apparent in the South
and parts of the West, where
farmers are the chief benefici'
aries. Then, too, the prospect is
that spring will bring much in
creased PWA spending.
Despite some let-dOwn in au-
tOmObiIe manufacturers buying,
steel production made some re-
covery last week. The railways
are using Government loans to
buy more steel and probably
there has been some miScella-
neOus ordering to anticipate
possible strike difficulties.
The automobile industry itself
held about steady at fairly high
level. Although there is some evi-
dence that the motor trade has
been a little overoptimistic about
1884 volume, the chief drawback
lies in the threat OF strike which
might tie this leading industry up
for several weeks right at the sea-
sons production peak.
We often find decline in car
loadings in the week covered by
the last report, but this year they
gained, and were 6 per cent
above the 1882 level. (There is no
sense in comparisons with last
year, when the bank crisis was on0
Electric power production showed
little change.
It continues to seem reasonable
to expect business volume this
year to approximate that of 1881.
One alternative is that strikes and
tagging consumer buying power
may cause setback. On the other
hand, initiation may yet break
loose and bring a squirt in activity.
But I doubt that the Government
can afford to tolerate serious
strikes; while initiation is so ham
pered by restrictions on profits
that it is hard to start unless by
the direct printing press route.
OOAAA1UUAOy pIACCS 1uUVCu up
another notch last week, and
there were some indications in
wholesale trades of interest in
buying for next fall in anticipa-
tiOn of still higher prices. 1t was
reported that both wholesale
and retail prices averaged about
2 per cent higher last month.
While there may now be a little
reaction in wholesale prices for
textiles and foods, we might as
well recognize that eventually
higher price levels are made in
evitable by dollar devaluatiOn
and credit initiation.
The outstanding developments
of the week were Cd clashes
among political groups, 90 steps
toward initiation. and 90 the cri-
sis with organized labor.
Congress clashed with the Ad-
ministration on the bonus, silver,
and the st. Lawrence scheme, in
addition to the 30-hour week, and
the stock exchange bill. Even the
Bankhead bill for cotton control
shows less willingness to follow
the President-who still holds the
air mail problem by the tail.
AS to initiation, the President
expressed himself as not unwilling
to resort to S. non-interest-bear-
ing Treasury notes ('baby bonds")
as a circulating medium. Secretary
Morganthau apparently sees no
economic principles involved in
"doing something for silver" and
may do something if business has
a "tail spin" And the Administra-
ton is Fastening to devise schemes
for inducing 5-year loans to busi-
ness, either directly through r..
F. c. or indirectly through some
new form of intermediate credit
bank" or both. Both would in
volve Government credit.
OF course, the Treasury con-
tinues to issue those so-called
"gold certificates to the Reserve
Banks, thus pumping Government
credit into the banks.