Milford chronicle., 1939-01-20
ECONOMIC HIGHLlGHTS

e HAPPENINGS THAT AFFECT THE DINNR
: PAILs, DIVIDEND CHECKS AND Tax
5 BILLS OF EVERY INDIVIDUAL
1 National and International Problems
IHsebarabie from Local Weltaze
, The decline in industrial activit,
during the nine months followinl
August, 1887, was the sharpest OF
> record for any comparable period
reports the United States News. The
recovery movement that set in siS
months ago, according to the same
source, has no precedent in rapidity
OF improvement, with the exception
OF the brief pre-NRA boom.
These comparisons are based upon
the Federal Reserve Boards index
of Industrial production, which is a
generally accepted barometer of in
dustrial illness or health. This index
uses the 192S-25 average as a nor
nal" with rating of 100. In Au-
Z gust, 1887, the reading was 117-al-
/ most as high as in 1929. In the sub
sequent May, it had dropped to the
/ abysmal low of 76-a drop of over
80 per cent in less than a year.
Since May, 1888. the index has ris-
en- "A points, which is close to half
as much as it gained, on the average.
in the four preceding years. We thus
have regained something more than
half the ground We lost in the 1887
recession"
Big question is, when can we exs
peet to regain the rest of the
ground? In answering that, most
economists are playing a wary game. |
There is no lack of good signs on
the economic horizon. At the same
time, there are number of puzzling
unfavorable factors. The Annalist
puts the case accurately, when il
says: There would be more assur-
ance of a continuation of the pres
ent recovery movement if there were
not so many individual indicators
that by this time should be reflect
ing the recovery movement, but thus
far have done so either not at all
or to limited extent"
Many experts think that in the
near future the rate of recovery
may tend to slow-but that the
will go ahead, even
though it is in second or low gear.
II IS an important fact that most
business leaders are not greatly ;
worried about what the next Con- :
sress Will do-they feel that our {
lawmakers. after earnest analysis OF 5
he last election returns, will vee..
steadily to the right. I
A few business briefs of interest
ollow: I
PRICES. Commodity prices re- I
emily took fairly sharp drop,
hou2h they were well supported v
nd there was no danger of a crash s
Il values. The whole price situation "
S confused and rather chaotic, and Il
S one of the least bright spots in a
he business picture. c
CREDIT: Bank deposits are at al L
most an all-time high-which means p
here is an abundant credit basis Il
or business expansion. 1t will re- tC
main to be seen whether business a.
oans will increase accordingly. So a
ar, they haven't. el
STEEL: Index of production is at
'nly fair level. The trend is up- NJ
yard, but no great betterment is eX- CT
'ected for the next month or two. G
LIFE INSURANCE: This indus G
ry's sales are often a good index fl
+ purchasing power. Recently they lC
ave shown substantial improve
lent. But this improvement is, pl
lost think, due largely to the fact A
hat the companies. because of in la
breed to reduce their guaranteed m
dividends" Prospective buyers have in
ushed to purchase policies under th
ne old, more favorable terms. al
MOTORS: Is booming along in re
lie shape. The American public ap-
elite for cars is apparently insaii- pr
it also appears that many
antilles will sacrifice almost any M
ling else in order to obtain a new Ii
lodel. by
CONSTRUCTION: Is steadily i'm mi
rowing, especially in the residential ac
eld, when adjustment for seasonal fin
ends is made. This is one of the
est phases of the entire recovery int
ovement. ste
o da
More and more news is beginning be
leak out concerning the Admin alb
tration's vast rearmament plan. II of
ems certain that hundreds of mir thC
Ons will be spent next year for bat TO
eships, planes and expansion of all
e arms of the military service.
MS forthcoming war budget" will
'ubtless be the largest, for peace
ne, in our history.
In the meantime, there is consid- hei
able talk about possible ways OF sui
ancing 1t. The President has said res
at he does not want to do that bv the
ding to the debt-that he favors a mo
y-as-we-go plan so far as possible. Tn
the same time. sentiment gener- shi
Y in Congress seems to be against ing
W taxes. ter
One suggested solution is for the ma
to liquidate some of nit
tremendous assets held by the ope
c. This bureau is a big partner elel
American industry. and its hold mo-
IS run into the billions. They are, tral
Never, difficult to realize on-no A
: believes the RFC would dump soc
urities on the open market. as tell
t would be certain to cause a car
lrp break in values. tion
70. even though Congress is un- ters
ling, it may become necessary to and
for rearmament with new taxes, imp
higher old taxes. If the latter loaC
rise is chosen, it is likely that the and