Evening star. [volume] (Washington, D.C.) 1854-1972, 1940-09-15
Defense Drive Spurs
Retail Buying and
Factory Output
Many Communities Fee!
Preliminary Effects
Of Vast Spending
BY FRANK MacMILLEN,
Associated Press Business Writer.

MANN IudCulLLEN,
Associated Press Business Writer.
NEW YORK, Sept. 14.-Booming
retail buying and rising factory out
put marked business reports today
in the readjustment of the Ma
tons economic machinery to de-
tense needs.
Many communities felt the pre-
liminary spending push of the multi
billion dollar plans for strengthen
ing the military power of the West
ern Hemisphere.
New war industry plants, expand
ing pay rolls, the shift of men to
training centers, speeding of pro-
duction in steel and other indus
tries supplying essential materials
were details in post-Labor Day
acceleration of the economic up
swing.
How business was feeling the
great military program in other
ways than direct stimulus to fac
tory activity was illustrated in re-
tail trade. Merchants attributed
gains in sales of gifts, household
equipment, clothes and other goods
partly TO the increase in marriages
since the introduction of the con-
scription bill in Congress.
Trade analysts said a high mar
riage rate-resulting in the estab-
hshment of many new homes
probably would remain a business
factor for several months.
Aside from the increase in we'd
dingS, residential building was
spurred by the influx of workers
into industrial and military centers.
Home construction, recently the
highest since 1929. was expected to
maintain a high level through AL.
tumn, at least.
Backlogs Increase.
Businessmen were ENCOURAGED to
plan for prolonged stay on the
heights by the growing accumula-
ton of untitled orders from the let
ting of defense contracts.
The spectacular dimensions of de-
Tense awards were high-ighted this
week by contracts for 200 naval
vessels, costing nearly $4,000 900 600
Speed up" letters from War and
Navy authorities indicated efforts to
hasten the tooling and construction
of factories to produce aircraft,
munitions, tanks and engines.
Actual arms outlay, analysts CAL
culated, may approximate s5,oo0.-
100000 in the fiscal years ending
next June. leaving at least that
much additional to be spent In the
l94l-42 fiscal period.
British purchasing agents. more
over, have been placing orders in
this country at the rate Of about
sl70 10000 monthly.
These figures represented the big
gest "pump-priminE jolt business
has felt or prepared for since the
World War.
Business statistics are likely to
show a great many new highs from
month to month, for the defense
program is rapidly accelerating,"
said the magazine Business Week.
The upward trend in heavy in
dustry lifted steel output to a 1910
peak around 90 per cent of capacity.
Steel mills quickly recovered a Labor
Day drop in an attack on large
untitled orders accumulated In re-
cent months.
Steel Record possibility.
The Iron Age. a trade pubuca-
ton, suggested steel output this
year may set a new record. above
$4,000, 900 tons. If the industry holds
the pace set in August, when mills
made the third best showing in
history
Counting on good market for
cars as the Nations purchasing
power increases with the infusion
of defense money into spending
channels, the motor industry boosted
assembly of 1941 cars.
Trade sources estimated auto.
mobile manufacturers soon would
attain a lo00O0-unit weekly pro-
duction schedule. The estimated
outturn this week jumped to 63,24O
units from 1866 the previous week
and 42,445 in the comparable 1899
period.
The speed-up in the big steel and
motor industries hoisted business
lndlces. The Associated Press index
OF industrial activity climbed TO Ill
per cent of the 1929 level, the highest
Tor this season since 1929. compared
with 1898 the previous week and 81
a year ago.
The present index figure comes
close to duplicating the high of the
first wartime hike last autumn.
Confirming previous reports of the
best September trade start in wears.
the Federal Reserve Board reported
department store sales in the first
week of the month increased II per
cent over the like period last year.
Factory Cities Lead.
AS in previous weeks, the most
striking gains were shown at in
dustrial areas, notably in the Phila-
dalphia, Cleveland, Richmond and
Chicago reserve districts.
Wall Street, however. still pre-
sented contrast with the general
trade and industrial panorama.
After moderate advance the previous
week stocks sagged again and bonds
barely held price positions intact.
Brokers blamed the Wall Street
inertia largely on suspense in finan-
cial circles over the outcome of the
battle of England. They noted the
market dropped with the intensified
ton of the air attack on London and
seemed particularly sensitive to
Prime Minister Churchill's warning
an attempted invasion of the British
Isles may be near.