Evening star., 1938-07-17
BUSINESS AIDED
BY j. s. SPENDING
ANDFARM CASH.
Motor Orders Up Sharply,
Electric Power Losses
Whitfield Down.
FAITH IN CONTINUED
RECOVERY is STRESSED
Commerce Department Reveals
Firm Tone of 0ptimism-New
Crops Boost Income.
BY THOMAS E. FLANAGAN,
Associated Press Financial Writer.

ny 1nOuAS Il. fLANAUaN,
Associated Press Financial Writer.
Government spending and sea-
sonal rise in farm income put fresh
energy into the Nations business this
week.
The sale of new crops gave farmers
more cash to spend.
The interruption Of activity due to
the Independence Day holiday left
statistical comparisons out of joint
for the second successive week. I'M
portant indications regarding indus
trial improvement were provided.
| however, by the motor and electric
power industries.
From the former came reports of
an unexpected squirt OF incoming or
ders; from the latter indications that
losses from 1887 were being whitfield
down in some areas
More significant than mere statistics
on business betterment were straws
in the wind which appeared to indi-
cate that sentiment continued opti-
mistic.
Firm Optimism Seen.
The Department of Commerce, in
its weekly survey of business condi-
tions in 36 cities, said:
While various indicators showed
relatively small advances, the Nation
wide reports revealed firm tone of
optimism and faith in the continued
processes of recovery that have been
under way during the last 80 days.
THE immediate major factors in
stimulating recovery were the how
of funds into agricultural districts
from the sale Of new crops, Govern
ment spending and improvement in
the stock markets"
Experts who tried to gauge the out
look in terms of weeks developments
had the following factors with which
to work: Commodity prices were firm,
a gain being recorded in scrap steel
the most important industrial raw
material. The stock market showed
less emotion than In recent weeks but
gave good account of itself. Buyers
flocking to major wholesale markets
were cheerful.
Tool Sales Improve.
Sales Of machine tools-a signifi-
cant barometer - improved. The
building industry reported gains in
important centers. Textile markets
braced up further. Demand improved
for miscellaneous products, such as
electrical equipment and furniture.
Wall Street was able to chalk up
another bright item on its scoreboard
when the capital market had another
chance to demonstrate its receptive
ness to new bond issue. Within the
past few weeks 1t has digested some
what more than $300,000,000 of new
bond issues. This week it promptly
snapped up one bond issue Of $780,
100000 Out in front among the
buyers, it was said, were private in
vestors as well as banks and insurance
companies.
Economists insist no recovery can go
far or long hold its own without the
aid of the steel industry. Latest ad-
vices from the field showed operations
up but the trade still in a dither over
price uncertainties and the future of
wage schedules.
| The concensus appeared to be that
the recent price reductions had stim-
ulated little new demand. Some buy
ers made an effort to replenish stocks.
Except for new business flowing from
Government spending, it was believed
the automobile industry was the only
! bright spot for the steel trade. Rail-
roads remained timid buyers. In the
words Of one expert, nevertheless, the
scrap market behaved like important
demand was around the corner"
Industrial Index Up.
Industrial activity, measured by the
Associated Press index, rose to 6s.3
from 81 the previous week and COM
pared with 1858 in the like week a
year ago.
The American Iron & Steel Insti-
tute estimated operations at 1913 per
cent of capacity, the highest since
mid-April. This compared with 224
per cent the previous week, which in
cluded the holiday, and 1927 per cent
in the like 1887 week.
The Edison Electric Institute re-
ported power production at 1881 ,298,-
900 kilowatt hours in the week ended
July 9. This was moderate decrease
from the previous week and 1913 per
cent below the figure for a year ago.
Automobile output was reported by
Wards at 42,010 units, compared with
25,375 the previous week and 1880
in the like week last year. It was
noted that the rebound from the holi-
day let-down was little greater than
expected
The Association Of American Rail-
roads reported carloadings In the
week ended July 8 at SOL ,013, q de-
crease Of 14.9 per cent from the pre-
ceding week and 26.2 per cent below
the level Of the like 1887 week.
A breakdown of Commerce Departs
ment reports indicated that, for the
first time in many months, retail trada
increased in about as many localities
as it decreased. In q number Of cities.
trade was about even with that Of a
year ago.
Pronounced increases were reported
in Milwaukee, Wilmington, Omaha,
Buffalo, Boston, Dallas, Minneapolis,
st. Louis, Washington, New Orleans
and Charleston.
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MORE CARS tn RE NEEDED