Evening star., 1937-03-21


)er, Sweet Chariot,
ton with reference to a given earlier
date is easily measured But the in
deX is made up of 784 commodities
and its compOnents do not move uni
formly. AS measured by price changes.
our economic improvement has been
distributed unevenly since 1882.
Comparison of Prices.
Compared to 1926, prices on the
average are still about IA per cent de-
pressed. One group, however-"hi hides
ana leather productS'-is some 3 PEI
cent above 1926 The same is true
in varying degree. Of certain SUBJ
groups. For example. cattle feed hides
and skins, structural steel and grains
have staged a full comeback.
Compared to 1929 instead of 1926
no component group in the Labor De-
partment index has recorded a COM
plete recovery. Even the outstanding
hide and leather products group is still
6 points below that pre-depression
year. Building materials prices, it is
worth noting, however, are now practi-
cally back at 1925 levels, whereas the
volume of construction is still small
when compared with the prosperity
period.
Against the background of 1882, that
year OF deepest depression, quite a
different picture is revealed. Most
rapid in their average rate of recovery
to date have been the prices of farm
products, hides, foods and building
materials. The groups which suf-
tered the greatest decline during the
depression were raw materials and
semi ml-manufactures, while finished
prOductS-the prices of which are. of
course, under greater degree of con-
trol-ShoWed less instability. Since
1882 the former groups have come
back sharply. In the case of raw
materials they have recovered their
former parity with the other groups.
Farm parity" is now attained.
Recent Recovery.
The foregoing facts are interesting,
but perhaps not exciting. 1t is in
comparing the recovery prior to Octo-
Der 81, 1886, with the recovery since
October 81 that We learn some Of
the most interesting features of recent
group price movements. The period
from 1892 to October 81, 1896, was
approximately four years. The period
from october 81 last through Febru-
airy q, 1887, was one of four months.
The former period was thus about IL
times as long as the other. Yet in
the brief four months interval the
degree of recovery in metal prices, etc.
t5.6 points,, was almost as great as
in the entire four preceding years (62
points. Similar rapid recovery since
October was recorded by chemicals
and drugs go compared with 800,
house furnishing goods t6.2 and 81)
and miscellaneous goods (5.3 and 49, =.
To put the contrast in another way,
the rate of change during the last
four months as compared with the
average of the preceding four years
was, in the case of metals and metal
products, IL times as rapid. In the
case of building materials it was five
times as rapid; chemicals and drugs,
| and house furnishings, over 8; mis-
cellaneous, 9; foods and farm prod
ucts, 2 2, and "all commodities" 312
times. Not since the speculative days
of 1888 has there been such activity.
Almost third of the entire price
recovery recorded up to March came
in the preceding four months. In the
case of farm products and foodS-al-
though in earlier years they had re-
sponded to the inflationary and farm
programs, and to the drought-more
than one fifth OF the recovery to date
! has come in the four-month period.
In fact, only one group-fuels and
lighting materials-failed during the
| fourth months to show an increase of
material proportions.
Imitation Psychology.
Yet it seems obvious that there has
| not latterly existed the widespread
currency initiation psychology of the
| 1893 DAYS when the dollar was rapidly
depreciating following the suspension
| of the gold standard. Unlike 1888,
the controlling influences latterly have
been not the anticipating of economic
recovery, but the actual growing
pains" of revived industrial activity,
often at or near practical capacity,
accompanied by dwindling commodity
stocks and untitled orders, and sea-
soned by heavy ornaments and spec
ulative purchases of international
commodities throughout the world
Aiding in the movement has been
| international cartel and production
restriction arrangements. as in copper
and rubber, and at home, more re-
Gently, the reflection in manufac-
tured goods prices Of increased labor
| and material costs, and--not to be
forsotten-the natural and artificial