The Washington times. [volume] (Washington [D.C.]) 1902-1939, 1936-01-07
SEES NO
!. REAS0NF FOR
/. LETD0WN
BY LEWIS HANEY,
professor Of Economies,
New York University


. New York University
The business news Of the past
week has been satisfactory. There
has been some evidence Of hesita-
ton here and there, and the usual
slowing down in industry at the
holiday season has occurred. But
on the whole, there has been moth
ing, to indicate that. the recent i'm
proved level may not be held, and
be followed by further gains.
From now on, politics will be
very much in evidence, and
political uncertainty Is not
conducive to the maximum
Of business activity. Fortunately,
however, there now exists .
more effective opposition to the
:: dominant party. This in itself
warrants greater confidence, for
It tends to insure against haSty
radical action.
Last week the steel industry be-
gan to come back after the year"
end lull. In several producing cen
tiers, production was stepped up.
The finishing mills have held to
relatively steady operations, and
consumers have taken deliveries
on orders rather freely. Naturally,
therefore, the production Of ingots,
or crude steel, will snap back.
The automobile manufacturers,
however, are buying steel q little
more. cautiously, as signs OF the
expected slowing up in consumer
buying appear. Registrations OF
new cars in December were very
large-in some cases record-break-
ing. There is no reason to doubt
that the total business for the
year will be up. Merely q slower
pace for q while, pending the
spring season, is to be expected.
The cotton manufacturing In
dustry has shown greater irreg-
1Ilarity, on account Of uncertain
ties concerning the decisions on
AAA and the Bankhead bill. The
lumber industry has made little
change. In the oil industry, q
further curtailment Of crude pro
duction occurred, and this Is tend
ing to strengthen the price struc-
tlIre.
Railway car loadings have be-
come encouraging, the decline In
the week ended on December 70
being less than usual for the sea
son. It is notable that the load
ings of coke, ore and forest prod
nets are running As per cent or
better above q year ago.
The post Christmas retail trade
has been fair, and the outlook
seems very good. The stores. start
with q clean inventory position,
. and face an early Easter season.
The indications given by buyer In
terest and wholesale activity
point to an excellent spring
trade.
J.. Commodity prices snapped back
last week, led by grain. Sugar,
cotton, silk, wool and worsted
yarns, rubber, and hides were
higher. While lard reacted, the
hog market recovered. Tin was
off, and the foreign copper mar
ket was a bit weak.
Naturally the price situation
has been affected by uncertainty
concerning the pending decisions
concerning AAA and the process
ing taxes. Buyers have held off.
whichever way the Supreme
Court decides, some gain in acti-
Vity was bound to follow.
If the decision had upheld the
Administration, prices Of farm
products would have strength
ened, but consumers would then
be able to buy less. The long
run results would be unfavOr.
able.
Now that the decision has
gone against the New Deal,
there will probably be q brief
period Of hesitation, and some
: reaction in the prices Of certain
agricultural products. But pro-
Cessfng taxes come out Of the
consumers pocket, and their re-
neal should mean lower living
costs. This in turn should en-
able consumers to buy more,
and eventually increase the
quality Of farm products de-
manded.
Furthermore, like the MIRA de-
cision, another setback for the
New Deal scheme of political con-
troll over industry will promote
general business confidence ana
tend to stimulate real recovery.
The drive for an immediate
soldiers bonus" payment has
made progress. With the green
back feature eliminated, all OBJ
servers expect the. thing to go
through. The result will be an
addition of one or two billion
dollars to the public debt.
Thus events are shaping up TO
force the nations budget" prob
lem into the limelight. # the
d'bonus" goes through, can the
President still allege that we are
approaching" a balanced budget?
or will he give up the pretense
and drift on to the SOTO billion
dollar debt which he has alleged
that some unnamed "big bankers"
once suggested?
z W WonIlunYfh n