Evening star., 1937-11-21
RETAIL BUSINESS
BEGINS TO FEEL
EFFECT OF SLUMP
Consumer Buying Reduced
Sharply as Industrial
Activity DWindIes.
SALES BELOW WEEK AGO
AND SAME 1886 PERIOD
Unfavorable Weather Is Infu.
ence-Estimates of Christmas
Demand Lowered in East.
BY THOMAS E. FLANAGAN,
Associated Press ElnancIaI Wrlfer


Associated Press Financial Writer.
Evidence that the continued decline
in industrial operations was taking its
toll of consumer buying topped the
Nations business news last week
Since early September, industrial ac-
tivity-led by steel-has fallen stead
lily. Despite this, retail trade put up
fairly stiff front, although unit gains
were cut down in some regions and in
others limited declines from 1886 ap-
peared.
Lending stout support to retail trade
was higher farm purchasing power and
relatively wide spending activities in
industrial sectors which had enjoyed
the recovery boom.
Steel operations had spurted to
reach, last April, the highest rate on
record for peacetime Electricity out
put had scared to unprecedented
heights.
With the falling off in these two in
dustries and accompanying declines
in motor output and freight car load
ings came let-doWns in textile. shoe
and miscellaneous manufacturing.
Slower operations left dwindling buy
ing power in their wake, but not until
recently has this made itself acutely
felt.
Sales Volumes Reduced.
Surveying the field, the Department
OF Commerce in its weekly review Of 81
cities said: Retail trade throughout
the country settled down to a greatly
reduced volume during the week and
suffered by comparison with the pre-.
yious week and with the correspond.
ing period last year.
While these reports, on the surface,
presented a rather unattractive pic
ture, there seemed to be some extenu-
able weather, which retarded appreci.
ably the flow of fall buying.
Many reports stated that the inn
minent distribution Of large Christmas
savings funds and the expected arrival
Of seasonable fall and winter weather
should bring retail trade back approx.
mately to normal levels. Here and
there were encouraging reports Of i'm
proved business conditions.
I'm so far as retail trade is con.
cerned, however, the reports unmis-
takably gave evidence of the fact that
the slackened activity in many lines
has at last begun to put the brakes
on consumer buying"
Yule Savings to Help.
In an estimate of Christmas trade,
Business Week said: AT the moment,
industrial Eastern States will count
themselves lucky to equal last years
volume, while the better situated agri-
cultural States still look for some in
crease over last year. but a smaller ons
| than they expected a month ago.
| Christmas club funds to be distributed
shortly will be 10 per cent smaller than
those of 1886 and will 60 to 10000
fewer persons"
The Associated Press index of in.
dustrial activity dropped to 839 from
| 87.7 (revised) last week. A year ago
it was 98.
Steel operations declined to the
lowest point. except for one week in
July, 1885, since the end of 1884. Work
ran at 36.4 per cent of capacity, COM
pared with Al the week before, the
American Iron & Steel Institute re.
ported. A month ago it was at 55s, .
year ago at TAI.
Skinny support from the motor in
| dustry was again held mainly account
| h1a IN "a ntI, how'd
| sales Of automobiles have been increas-
| ing. If this continues it should foster
heavier output and in turn mean more
business for the steel makers.
Auto Production Higher.
Production of automobiles increased
to 85,757 units from 83,325 the week
previous and compared with 1926
in the like 1886 week, Wards estimated.
Full 1887 production, it was said.
may drop little under 100000 a siz-
| able cut from earlier predictions Of
| 100000. Strikes at General Motors
plants threw shadow across the out
look at the close Of the week
Carloadings in the week ended Mo-
vember 13 were down So per cent to
689,614. the Association of American
Railroads reported. The total was
12.1 per cent under the like week OF
last year. Traffic analysts noted q
drop in miscellaneous shipments Of
freight but a slight upswing in the
movement of coal.
In the week ended November 10,
production of electricity was 2,176,-
$4,000 kilowatt hours, the Edison
Electric Institute reported. This was
a slight gain over the corresponding
week Of last year, but the margin of
gain was smaller than that scored in
the preceding week
Once more smaller demand for
power in the industrial regions bore
witness to the slower pace Of factory
and mill operations.
Wall Street Anxious.
Wall Street took note of receding
trade and industry. 1t saw shares on
the New York Stock Exchange drift
down to the lowest point in more than
two years. Among brokers the view
was confidence had faltered. Covering
brought some recovery at the close of
the week.
Although financial observers said
they believed the Government was be-
coming increasingly eager to reyiEN
business, opinion was that administra-
tion measures may take some time to
become actively effective.
In the bond market, United States
loans advanced, in part with the did
of demand in the open market from
the Federal Reserve System Short
term obligations were bought in keep
ing with the Reserve Boards plan Of
(see BUSINESS, Page Esq