Evening star., 1937-06-21
OUTLOOK CL0UDED
BY LABOR STRIFE
Pessimism Also Increased
by Drop in Securities
and Commodities.
Special Dispatch to The Star.

Special DlSpatch 10 lhe star.
NEW YORK, June 2l.-"Strikes
and threats OF strikes continue to
cast a shadow over business activity
for the next quarter" reports Busi-
ness Week today.
In addition, pessimsm has been
enhanced by almost uninterrupted
declines in securities and basic whole
sale commodities since March, when
administration comments nipped the
inflationary rise Of prices in the bud.
Cotton textile mills that have been
operating at good clip on orders
placed earlier in the year are now
beginning to curtail operations or are
contemplating shutdowns in July or
August. Such slackenng is not un-
usual in Summer months, but it ap-
pears now that there will be more
Of it this Summer than customary.
Last year national income pro-
duced in the United States reached
s63 ,7eo. 100000, gain OF nearly nine
billions, or is per cent short Of the
1929 total. The amount distributed
in wages, salaries, dividends, interest,
rents and royalties was S62.O56, ,0OO,-
600, leaving margin Of about one
and three-quarter billion dollars as
business savings for the rainy day.
This year income distributed is ex-
pected to hit 10 billion.
Steel production this month will,
Of course, be we'll below that Of MAY,
since practically 20 per cent Of the
industrys capacity Is tied up with
strikes. Citation of Inland Steel by
the National Labor relations Board
for refusal to sign a pact with the
union is expected to bring the pivotal
issue in the current strike among In
dependent steel producers to a show
down. In view Of past decisions on
the issue. as we'll as the Presidents
own comments this week. it would
seem dubious that the steel COM
panies' main contention will be up
held. But trade papers and local OBJ
servers in the strike area think they
perceive rift in the heretofore sue
cessful drive OF the C. I. o. forces,
and predict that the back-to-Work
movement Of loyal workers will open
closed plants shortly.
Automobile assemblies have not
rebounded to the rate prevailing in
May, following the holiday week, and
there is small likelihood that they
will. Though strikes have prevented
the industry from reaching the levels
scheduled for the second quarter, the
trend from now until September is
undoubtedly downward. General Mo-
tors agreement with the United Auto
mobile Workers, which expired on
June II, is now under consideration
for revision, with both sides playing
for time and watching the strike
in steel centers for a clue to pro-
cedures.
n-ferrous metal markets haven't
been any too clipper of late. May
brought the long g-expected rise in re-
fined copper stocks. revealing that
production had caught up with ap-
parent consumption. AS a result,
London copper prices fell below the
domestic l4-cent level.
What's bothering some retailers.
besides the fact that the public isn't
buying as much as was expected of
1t in this year Of rising incomes, Is
the fact that it is buying an increas-
ing proportion Of its needs on credit,
either through charge accounts or
installment plans. Last year, for ex-
ample, installment sales jumped 25
per cent, from $500 100000 to 81
100000, 900, while charge accounts rose
IS per cent to $s,000,000, 900. Ex-
tension of credit purchases to soft
lines" such as clothing, helped boost
the total. So far, collections have
been improving, compared with ex-
perience in previous years, but break
in business activity in general might
easily upset the apple cart"