Evening star. [volume] (Washington, D.C.) 1854-1972, 1940-02-04
Factory Chiefs
Await Fresh
Buying Wave
Retail SoIes Ruise
Hopes as Executives
Cut Production
BY SMITH REAVIS,
4 sSor{afad press Fipa pciaI writsY

Associated Press Financial Writer.
NEW YORK, Feb. 4.-Business
managers adjusted factory sched-
ules to a lower scale of production
today but hopefully scanned the
spring outlook for signs of another
wave of ar-stimulated buying.
Well-maintained retail demand
for goods despite difficulties of shop
ping in the bitter weather encour-
aged industrialists to expect quick
consumption of stocks accumulated
in recent months.
Meanwhile, evidence multiplied
that industry generally was in a
let-down from the tremendous surge
of buying in textiles. steel and other
lines during the early months of the
war.
In steel, focal point of the reviving
heavy industries, operations were re-
duced this week to 77.3 per cent of
capacity, compared with a peak of
944 in December. Trade reports
forecast further shrinkage at some
steel centers next week.
For several weeks untitled orders
on the books of steel makers have
been declining because the mills
were shipping metal to consumers
in excess of new buying; a similar
drop IN backlogs was noted for tex
tile and other industries sharing in
the initial war boom.
Buying Rush Cited,
Surveying the situation, the Ma
tional City Bank of New York
pointed out the almost unprece-
denied concentration of buying" in
the first few weeks of the war per-
mltted business to cover require
ments well ahead"
"As soon as the proportions of the
upswing became clear" the bank
added, experienced business leaders
warned of a let-down to follow.
These warnings have served a
constructive purpose. They modi-
ned some of the overoptimistic
ideas as to the probable volume of
war business and expansion of ex-
port trade, and they had a good deal
TO do with dispelling fears of a
scarcity of commodities"
The bank agreed with conclusions
OF most analysts that nothing like
the 1887 overexpansion of inventory
and commitments has occurred"
Thus many were hopeful buying
would be resumed in volume over
the next few months, particularly
since war trends to make business
men carry larger supplies than usual
Tor protection against price ad-
vances.
Associated Press Index of.
The new year decline in produc-
ton was measured by drop in the
Associated Press index of industrial
activity to 1868 per cent of the
1880 level from the December
peak of 1921, 10-year high.
The latest figure, however, COM
pared with 89.1 year ago.
There was ample trade data to
SHOW business got off to a good new
year start in spite of the slowing of
factory wheels and the coolest Jan
uary the Nation has seen in many
years
January automobile output was
estimated about 465,OO0 cars and
trucks, record for the month. With
| dealers stocked for the early spring
demand, motor manufacturers
planned February cut in assem-
blles. The weeks assembly figures
revealed output was tapering of.
The Bell system reported the jan
uary gain in telephone installations
was the largest for any month in
two years.
More significant in the view of
some analysts was the revelation
shoppers had braved January's ice
and snow to keep retail business at
high level. January department
store trade in the New York area
was rated nearly IL per cent ahead
OF the comparable 1889 period, the
largest year-to-year increase since
March, 1887.
For the whole Nation, the Federal
Reserve Board figured department
store sales in the first four weeks of
1910 ran per cent ahead of the
like 1899 weeks.
Warmer Weather Helps.
Warmer weather, moreover, spurred
shopping in many communities the
past week and turned attention to
Easter needs, trade reports said.
Largely Indifferent to the autumn
business upswing, security markets
continued to drift in Wall Street. 1t
was lean time for brokers. jan
uary share turnover on the stock
exchange was the smallest for the
month since 1922.
The price of stock exchange seat
dropped to $48, 900. lowest since 1918.
Speculation in stocks and COM
modities, often associated with war
years, was limited to occasional fur
rieS in special issues. Market ex-
perts cited the business showdown
and desire of traders to await devel-
opments in politics at home and the
war abroad as reasons for the
inactivity.
Bulls willing to gamble on a bus