Evening star., 1940-05-26
Business Prepares
For Rapid Shift
To War Basis
Steel Executives [ Look
For One Of Busiest
Summers in Years

by the ASSOCIATED Press.
NEW YORK, May 25.-Allied and
United States arms spending plans,
business reports indicated today,
may call into use the latent capac-
tiles Of Americas huge industrial
machine.
More steel furnaces, the reports
received in Wall Street said, would
60 into operation next week. to
meet expanded Allied and other ex-
port demand. Home buying of steel
also was reported reviving In adj
vance Of Uncle Sans big defense
drive.
Steel men looked forward to one
OF the busiest summers In years
at the rate activity was recovering
from the winter and early spring
slump.
Seemingly in the making, business
observers held, was the biggest
Nransition Of the industrial machine
from peacetime to war pursuits
since the 1914-18 boom in heavy in
dustries producing the implements
OF blitzkrieg.
Aircraft, shipbuilding, tool-mak.
ing, munitions and other divisions
OF war industry, it appeared were
set to take fup part or all the slack
IN dollar totals resulting from loss
OF european markets for many Of
the products of normal trade, par.
ticularly farm exports.
Responding to accounts of mount.
Ing steel schedules in the Chicago.
Bunalo and other industrial areas,
steel shares rallied In today's brief
session on the security exchanges.
Markets Improve.
Brokers welcomed the renewed in
terest IN war babies" following the
worst spill speculative markets have
experienced in seven years. Touched
on by news OF the German smash
through the Low Countries into
Northern France, the Wall Street
crash extended into this week. but
was checked as Allied resistance stiff.
tened and the first wave of market
fright subsided.
commodities likewise made
stand after the plunge in such farm
staples as wheat and cotton on fear
OF more curtailment in European
demand If the Nazi push continues
TO cut of continental markets from
transatlantic trade.
Inc German sprint to Channel
ports and invasion of textile CEN
ters IN Northern France threatened
70 oostruct the chief remaining con-
tinental market for American cot.
ton' long Uncle Sans No. / export
item. '
AS onset to the shrinkage IN Eu-
ropean market. business circles
counted on increased domestic con-
sumption if the combination of Al.
ileo and United States arms SPEND
ing produces a boom in heavy in.
dustry.
+ Allied Orders Climb.
Allied buying of steel was re-
| ported to have increased. An addi-
tional S100,00O,O00 in British and
French orders FOR warplanes wa,
SAID by Allied spokesmen to have
raised fetal aircraft orders to some
$725. .00O,0 900. ''
aircraft and engine manufactur.
ing executives conferred with Wash.
lnston officials for the campaign to
speed the production pace. Some
analysts suggest. however, 1t would
DC wen into l94l before war In.
dustries would hum at full speed.
Striking the keynote of the shift.
ing industrial theme, Iron Age. A
trade publication, reported steel
companies expect Allied buying to
average as much as 100000 tons a
month Tor the duration Of the war.
Inere was even talk of a steel
shortage II the war continues and
the world turns to the United States
Tor metal to replace supplies for.
merry obtained in Europe.
temporarily, at least, the collapse
OF speculative markets in fright over
a possible Nazi-dominated Europe
moved domestic users in metal and
other wholesale markets to order
cautiously.
Retail sales of automobiles, lux.
ury goods and household equipment,
trade reports said, slowed somewhat
IN the wake OF the slump in security
ana commodity prices. On the
whole, though. retail trade was de.
Scribed as fair, with sales still run.
ming ahead of last year.
up for the third straight week,
tne Associated Press industrial &C.
tlvlty index now stands at 9S.7 per
cent OF the l929-30 level, compared
with the late April low of 936 and
1888 a year ago. Spring expansion
IN nome building joined with steel
IN supporting the advance of this
industrial gauge.