Evening star., 1937-08-29
Higher Costs, Possible Slash
in Farm Income and Price
Test Studied.
CONSUMER RESISTANCE
TO ADVANCES FEARED
Industry Holds at High Levels,
With Steel Output and Freight
Loadings Higher.
BY THOMAS E. FLANAGAN.
Associated Press Financial Writer.

Associated Press Financial Writer
Reports from the Nations business
outposts last week showed most divis-
ions of industry running at a faster
pace while retail and wholesale trade
faltered.
Slower movement Of goods of re.
tail and wholesale shelves captured
most attention.
1t bore witness, business men said,
to three factors: % Higher manu-
featuring costs; CD possible down.
ward revision of farm buying power
estimates in the wake of falling grain
and cotton prices, and 80. the as yet
untested reaction of the ultimate con-
sumer to higher retail prices.
Analysts argued, nevertheless, that
statistics on industry pointed to con-
tinued momentum. Higher figures
were posted for steel output and car
loadlngs. Electric power production
continued its rise and touched height
never before reached. Motor makers
again slowed down as the current sea-
son neared its end
The Associated Press index Of in
dustrial activity rose to 1O44 from
1892 the week before and 95l in the
like week last year.
Rail Sales Spotty.
"A somewhat spotty tendency in the
movement Of retail trade throughout
the country was noted during the past
week" the Department Of Commerce
reported from 81 cities.
Trade in about half the reporting
cities scored moderate gains, while in
others the movement was sluggish or
fell definitely behind, with unfavorable
weather blamed in many cases. In
wholesale trade an uneven trend was
also noticeable"
Steel operations accelerated to s38
per cent of capacity from 1872 the
week previous and 72.5 per cent in
the like 1886 week, the American Iron
and Steel Institute reported.
Trade circles said the pickup In
steel orders noted the week previous
had failed to carry through. It was
said that although the inflow Of busi-
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in the corresponding part Of July, the
increase was moderate.
The bulk of improvement was said
to have come from the motor industry,
source from which expanded business
is expected within the next several
weeks, when output of new models gets
under way.
Power Output Climbs.
Production Of electric power ad-
vanced in the week ended August 81
to new top of 2,304 ,O32 900 kilowatt
hours. The upswing was contra-sea-
sonal experts said.
Power circles said they were I'M
pressed with the way in which pro-
duction was holding its margin of gain
over 1896. Earlier it had been pre-
dicted the rate of gain over last year
would slacken appreciably with the
approach of Labor day.
The weeks total was up 10 per cent
from the like 1896 week, a gain which
compared with l0.6 per cent scored in
the week ended August IA. Demand
for electricity for refrigeration, irriga-
ton pumping and the brisk rate Of
capital goods producers in the Central
industrial region were seen as i'm
portant factors.
Carloadings rose .05 Of per cent
in the week ended August 81, the As
sociation Of American Railroads re-
ported. The total, 781,247 cars, was
62 per cent larger than in the like
week Of 1896.
Auto Production Down.
Automobile output receded to S3,3 $40
units from 93,339 In the previous week
and compared with 59,237 in the cor
responding week last year, Wards re-
ported.
Motor circles scanning the horizon
for indications Of the strength Of con-
sumer demand noted with satisfaction
the Department of Commerce report
Of distribution. It showed the pre-
liminary adjusted index figure Of the
value Of retail sales Of new passenger
cars scored pronounced upturn from
June to July.
This index, which makes allowance
for seasonal variations, was los in
July, on the basis of 1929-l93l as 100.
It was 80 in June and 104.5 in July.
1896.
The department also reported
dollar volume OF retail financing Of
new cars dropped nearly 10 per cent
in July from the like month last year.
Evidence that consumer demand for
automobiles was running strong was
also seen in the report Of one General
Motors unit indicating an August
turnover around the largest In the
history OF this division of the cor
poration.
Shares on the New York Stock
Exchange dropped but turned steady
as the week closed The down.
(See BUSINESS, Page G.2.)