Evening star., 1939-05-06
Improved Commodity
Prices Regarded as
Hopeful Sign
Buying Waves in Copper
And Cotton Textiles
Cheer Observers
Special Dispatch to The Star.

6peclal DlSp6tcn 10 Tne Star.
NEW YORK, May 6.-Last week,
which completed the month of
April, saw a fractional recovery in
Business Weeks index of business
activity-due to a rise in carload
ings which out-weighted continued
losses elsewhere-but the month as
a whole must be marked down en-
phatically on the debit side. In
fact, the 5 per cent decline in the
monthly business index was the
biggest since the well-remembered
October, November and December
OF 1887, and before that since the
summer of 1884.
However, as May opened, the rise
In a number of the important raw
material prices, which began early
last week and continued into this,
was being interpreted as a FORE
runner of an improvement in gen.
eral confidence - certain to be
strengthened with relief from the
threat of catastrophe in the coal
tie up.
The buying wages in copper and
cotton textiles a week ago indicate
what may be expected elsewhere
not far in the future. Raw material
inventories of American manufac-
turers-crude oil. lumber, iron ore,
wool. rubber, cotton and some minor
commodities-are down again to the
low point of 1886, which preceded
the 2 per cent rise in these inven-
tories during the rest of that year
and early 1887.
1t is apparent that if the spark
can be struck which will stimulate
orders for industrial products, con-
siderable buying of raw materials
must take place, and the effects of
the improvement be transmitted
throughout the economy.
Europe Holds Key.
A fundamental question is whether
the improvement can occur while
the war crisis continues in Europe
Judging only by the experience to
every war scare abroad has been
accompanied by a decline in Amer
ican stock prices and in new busi-
ness initiated in this country. SINH
larly. each period of "appeasement"
has been accompanied by improve
ment of sentiment and business in
the United States.
The important task of the mo-
ment becomes that of disassociating
the link which connects crisis abroad
with bad business at home. 1t is
important to realize that American
business can have considerable
measure of prosperity-even if the
European situation continues as bad
as it is now Once this idea begins
to permeate the businessman and
investor it is not too much to hope
for at least some degree of i'm
provement in confidence and there
fore in buying. This could in turn
be the start of second recovery
movement which would regain the
losses of the last four months and
even carry the level of activity
above that reached at the end of
1898.
Retail Sales Good.
The domestic signs are not In
themselves discouraging. Retail
sales are continuing almost as If
Europe were in state of perfect
calm. Department stores have been
making a fair showing and the
mail order results for April were
excellent. Retail sales of radios
in the first quarter of 1899 were
II per cent above year ago.
Automobile sales for April were
so good that the first dent was
made in dealers stocks since last
September. Total income payments
to consumers, as compiled by the
Department of Commerce, turned
up in March, after two months
decline.
Building contracts are satisfac-
tory, although it must be admitted
that Government work is taking
an ever greater share in the total.
In fact, the Governments spending
program as laid out for the next
few months furnishes the best basis
for expecting another pickup in
business this summer.