Evening star., 1937-09-26
Autumn Impetus to Store
Volumes Helps Offset
Wall Street Gloom.
RAIL PAY ROLLS CUT
AS L0ADINGS L CLIMB
Power Output and Cotton Mill
Activity Jump, While Steel and
Building Rates Lag.
BY THOMAS e. FLANAGAN,
Associated. Press Financial Writer.

Ho'oSiobcu icSo llldHCldi writer.
Autumn impetus to retail trade
helped sustain the Nations business
last week against repercussions from
Wall streets downward spiral.
As Summer formally passed off the
calendar. consumers bought more
freely over the retail counters, cheer
ing merchants who had stocked
shelves in anticipation of brisk busi-
ness after the vacation season.
A new crash in stocks, carving
the market on the average to the
lowest in nearly two years. aroused
wide discussion in financial circles
OF the potential effects on trade and
industry.
Whether the decline in security
markets foreshadowed a business set
back was a question many sought to
answer from study of latest data.
However, on the face of available
statistics, it seemed nothing more
serious than marked slowing in the
recovery pace, with here and there
move to curtail production, had
taken place.
Trade Reports Cheerful.
The Department of Commerce.
summing up reports in It's weekly
survey Of 36 key cities. noted retail
trade stepped at a livelier tempo"
and said most of its reports were
couched in optimistic terms"
In contrast with reports some large
Eastern roads were cutting majnte-
mace expenditures and personnel to
offset higher operating costs, rail
freight loadings for the week ended
September 18 climbed to the highest
since 1890.
The jump in carloadings, together
with gains in electric power produc-
tlon and cotton manufacturing, off,
set decline in steel production and
further slump in residential building.
consequently, the Associated Press
index OF industrial activity, adjusted
for seasonal influences, mounted a
little, touching 1892 per cent of the
l929-30 level, compared with 103 the
preceding week and 94.7 in the COM
parable week last year.
But this index was we'll under the
recovery peak of 1895 set last April
and failure OF the business curve to
snow more vigorous upswing under
impulse of Autumn forces was disap-
pointing to many who had counted on
return OF strong forward drive.
Buying Power Higher.
With farmers enjoying the largest
cash intake probably since 1929 and
industrial pay rolls holding well above
year ago, trade analysts were hope
rul consumer buying would expand
sufficiently to reduce merchants in
ventories and encourage bolder buying
in wholesale markets.
Many observers saw a tendency
throughout the business world to work
OF goods accumulated on the buying
boom the last year in wholesale mar
kets. This rush last Spring lifted
production in cotton textiles. rayon.
boots and shoes and other consumer
goods lines to peak levels. Since then
slide in security prices and collapse
In worldwide speculation in basic
commodities have been accompanied
by more cautious attitude, analysts
said
While warning that one week does
not make a season, the Commerce
Department said surveys from many
OF the important areas reflected feel
ing that trade has entered upon a
definite upward trend and that recent
fears have been ill-founded."
~ -
ports" it added, came from New
York where department stores re-
corded the strongest comparative
showing last April
Weather Spurs Rise.
While seasonal weather was gener-
ally given as the predominating factor
in the upturn, it was pointed out in
many of the reports that funds f1ow-
ing from the new crops, larger en-
ployment and generally improved
economic conditions had much to do
with the improved situation"
Some wholesale lines, after the
Summer lull, also picked up. A squirt
in cotton cloth buying interrupted .
long stalemate, although a further
decline in raw cotton below BIZ cents
in futures markets restrained buyers
from going far.
Textile manufacturers, faced with
prospects of having to curtail pro-
duction unless buying improved suf-
ficiently to replenish dwindling back
logs, hopefully waited for demand to
broaden. These hopes were chilled
somewhat, it appeared, by resump-
ton of the decline in stocks toward
the weekend The break in stocks,
moreover, undermined bonds and
commodities, which also pointed
downward.
Stock Slump Studied.
What motivated selling in specu.
lative markets evoked various expla-
nations in brokerage quarters. Some
stressed foreign liquidation, others
mounting operating costs in this
country and possibilities of business
curtailment later in the year. At any
rate, the Fall had cumulative effects
in spreading gloom in trading circles
and weakening the position of margin
traders, many Of whom we're forced
into involuntary selling for lack of
cash to protect holdings.
Heading the retreat we're steels,
coppers, farm implement, machinery
and other industrial groups which
had basked In bullish favor during
q two-year recovery march running
into the early months of this year.
Steels, particularly, suffered as the
industry, only a few months ago max
ing new production records, cut
operations from so.4 to 76.1 per cent
OF capacity, Is estimated by the