The Washington times., 1934-07-10

y
~. business will
~ = pick up at least
Lewis Haney by october,
when it is supposed that renewed
stimulantS will be administered
by the New Deal party, to help
win votes in the November elec-
tions.
If you stop to think about it,
you must admit that business"
has come to a pretty pass when
we have to count on such politi-
cal maneuvering as the m n
factor.
In reality, there are plenty Of
signs that nobody is really sure
about what will happen. Almost
everyone now says, Imitation is
inevitable" But no one says
when" AS i have pointed out,
it is even possible that so many
people will anticipate a Fall
rise" that when Fall comes
there won't be much.
So it mostly comes down to
q matter of psychology and
guessing, and these in turn
mostly depend on New Deal pol
icies, with the steady drift to-
ward further initiation as the
chief factor.
On the bull side of the indus.
trial situation, we can put down
the following:
Cd Reduced prices for steel,
lumber, automobiles, shoes and
furniture, indicate a tendency to
sounder and more realistic busi-
ness policies.
90 The home renovation pro-
gram is being organized. Since
the Government is to guarantee
20 per cent of loans to home
owners, many think that home
activity will be stimulated.
90 The Government spending
program has been stepped up, and
promises to run close to three
million dollars a month.
"a In this connection, bank
deposits continue to- grow, and
to cause a greater and greater
pressure toward credit initiation.
50 The public works program
is being pushed a little more
actively, and apparently more
intelligently.
On the bear side Of business,
we note:
Cd Most of the bullish factors
depend upon the application of
dangerous Stimulants, the fear Of
which retards sound business.
(2) Similarly, great uncertainty
exists, not only as to the timing
of initiation, but also as to the ap-
plication and effect of existing
laws and future New Deal legisla-
ton.
The plain fact is that private
capital is afraid, while only gov
ernment credit is bold-because
those who extend it do not own
it, and have nothing to lose
thereby.
90 While the Frazier-Lemke
farm mortgage bill is not con-
Sidered Immediately dangerous,
many fear it will prove to be the
entering wedge to a virtual
abrogation of debt contracts.
90 Labor unrest continues to
simmer, and labor leaders may be
planning renewed outbreaks for
this fall. especially should bust
ness pick up well.
(5) Retail trade is backward in
most lines.
co While the German situa-
ton has not yet had much appar-
ent effect. it is not improbable
that developments in that un-
fortunate country will retard
worldwide recovery.
Meanwhile, the Administra-
tiOn is watching the water of
business ebb, after the spring
pump-priming spree. Industrial
activity did not get quite as
high as at the peak last sum.
mer, and last week it was just
about where it was in the same
week a year ago. 1t will soon
be considerably below.
More "priming" will come in
time. But until we know when
and how, it seems likely that
the water in the business pump
will settle little lower.
One thing we have learned is
that the New Deal tactics do not
produce stability. Rarely have we
witnessed sharper gyrations in the
business curve than in the past
year and a half. The recent sharp
curtailment in steel, textiles, lum
ber, ETC., together with cuts in
prices, points the lesson.
No one can claim that social
planning" has thus far brought
any certainty or stability.
n