Evening star., 1941-04-06
Stores Prepared
For Sharp Rise
In Demand
Pocketbooks Fottened
By Gigantic Defense
Expenditures
BY FRANK MAC MILLEN,
ASSOCIATED Press Business Writer.


That was the message In mer-
chandise markets this week as the
movement of goods across retail
store counters quickened under the
stimulus OF rising Easter apparel
shopping.
Experts feeling the pulse of con-
sumner buying power predicted retail
sales this year might aggregate be-
tween ,000,000,0O0 and $1,000
000,000 rise of 10 to II per cent
over 1940's aggregate of s45 ,050,0 ,0OO,-
900.
Mr.. and Mrs Average Americans
pocketbook is being fattened by the
out-pouring of the first of S35,000,-
100000 of Federal funds earmarked
for national defense and aid to Brit
ain The tempo of Government
spending is expected to rise as the
year proceeds.
The dollars flowing into busy cash
registers in the Nations stores al-
ready are setting up ripples travel-
ling far into the Nations machinery
for the production and distribution
Of peacetime goods While items Of
all sorts moved freely from store
shelves merchants were busy in
the back room penning orders 10
wholesalers for re-fills. requirements
and an expanded aggregate of mer-
chandise for summer and early fall
trade demand.
Demand BrOadens.
Wholesalers, in turn. as thev sped
deliveries OF merchandise to retail
establishments were widening their
own orders to manufacturers for
supplies of goods.
Trade trend spoilers" in whole
sale markets. a poll discloses, are
baslng forward purchases on the
following expectations in key lines
or fields of activity:
Steel-Continued operations at
| close to capacity throughout the
year to fill both defense and peace
time goods orders. Pittsburgh, Chi
cago and Gary. Cleveland Youngs-
town, Birmingham. Buffalo and
other big producing areas may see
biggest store sales in history
Aircraft-Nothing but 100 per
cent capacity operations in sight.
Heavy plane company payrolls will
boost consumer buying at Seattle,
Burbank, San Diego, Kansas City,
Detroit, at New England, New Jer-
sey and New York State producing
centers and other key points.
| Machine tools-Capacity opera
tions beneflciarieS, Cleveland, De-
troit, Chicago and other cities.
/ Shipbuilding ng-Expanding produc-
ton at virtually all yards-Pacif1c,
Atlantic and Gulf coasts.
/ utomobileS-Boom business for
Detroit, the auto producing center.
Midwest and Eastern cities with
parts plants, auto assembly factor
les, to share in business. Cleveland,
Akron, other rubber towns to profit.
Coal-Bituminous mining to rise
sharply over last year. stimulating
store business in Allegheny mine
towns.
Power Output Scars.
Electric power-Production of cleo
/ tricity the past fortnight has been
running better than Is per cent
above this season last year. and
heavy power sales may be expected
| to continue, both at private and
/ Government plants. throughout the
defense effort
Railroads.&c. railways as a
group currently are moving five
carloads of freight for each four
they handled last year
House furnishings-The fastest
new-home construction in a decade
or more, couples with double time
erecting of needed additional houses
for workers at defense centers. is
broadening demand for all types of
household goods, including furniture,
rugs, refrlgerators, ranges and elec-
trical appliances.
Foods-grocery store sales already
are running 10 per cent above last
year for the Nation as a whole. with
gains ranging to Is to 30 per cent
for leading distributors in some fac
/ tory cities. The increased domestic
food consumption, plus promise Of
larger Government parity payments
on major crops and prospect Of
widened food movement to Great
Britain are seen as factors that will
hike farm incomes. hence store
spending in rural areas.
There is one big unknown factor
in the trade outlook that could
| affect the volume of goods moved.
That unknown is prices.
AS the defense program expands,
American industry will be using its
facilities in rising percentage for
the production of armaments.
Unless plants making both defense
and peacetime goods are expanded,
the volume Of peacetime goods
manufactured may be reduced In
such case. the increased buying
power in the hands of individuals
may trv to buy more consumers
goods than are available in the
markets. The result would be
higher prices, unless the Govern
ment is successful in its heighten-
ing efforts to keep them in line and
reasonable.
Baruch Summary Cited.
NdVlOlldl Sllg DdIlk VI NEW OTk
points out that Bernard M. Baruch,
chairman of the War Industries
Board in World War No /, has
summed up the problem concisely.
Says Baruch;
IF production is at an annual
rate of s85 900 900 900, $40 900 900 900
of this may represent munitions.
The public. therefore. is left only
S75 900 900 900 of consumer goods to
buy with its $85, 900 100000 of pur-
chasing power. The result is in
evitably rising prices unless some
restraints are exercised"
Says National City: "The con-
verse of this statement is that if
the assumed $4,000, 100000 excess
Is diverted to the Government not
only will the inflationary influences
be restrained, but it will meet the
defense costs. If consumers abb
stain from buying goods-in other
words, II they save-their savings
can be borrowed by the Govern