The Wilmington morning star., 1946-10-26
HAS DEFLkTION
REALLY SET N?
BY RICHARD L. STROU,

let US say, up In O~OnAeCuCut. M-
Rayburn, or j. T" as his e.5.
tives call him, has come thu
the war pretty well. He has r
lot of secondary Army orders 1a,
built a new wing to the main rso.
and has added workers til ia
population of the fine old New ey.
land town, with its White-s.es,so
church, its ancient village 20.
and modern brick high school h.
more than doubled. Mr.. Raw,
is a good citizen. 1t is nc. l-s.
his generous direct donations A..
gifts and kindnesses in 4 huTrs4
quiet ways which have made No.
a popular figure.
Now a big economic probs,-
faces Mr.. Rayburn, as it does l,.,
sands of others like
over America. He had been va IN,
ing the stock market slowly sA-,o
downward for the past two a5a,7s
The stock market is a ,oy. o..
barometer. a pool of judeme~
of American investors and s1ec,Is.
tors as to what lies ahead. II Ia,
shifted over from the fair yes.,
err side to Change Nov re,
events are occurring. A weekor G.,
ago, President Truman threp M
meat controls and began q Hs,o,
campaign to decontrol other ,o~.
modities. There has been al M.
ward thrust of prices in some o~.
modities since, but the pea of
these already seems to have lass.
ed. On the cotton market scre.
thing odd is happening; it isn't.s,.
tain yet, but it looks very me,
as though a big speculative 6uoe
had been pricked.
Mr.. Rayburn. Aeing a carsr
modern businessman, has be-,
scanning business survey servle,
and other statistical material ar
months. He is aware Of the geis.
ally accepted theory that there rl
be a mild recession" sometime,
the future, maybe next year, toh
followed by a hoped-for halt-doun
years or so of sound prosper.t
built around immense con nt
demand for automobiles, horls
and similar durable goods. N
suddenly, almost within the as
week, a new and more urgent Ute
has entered the Wall Street John.
al last Friday asserted posittay
that ''the high cost of living vent
over the postwar peak and stated
doWnhill in the past 48 hours. THE
latest issue OF David LawseCes
careful United States News follows
this up: Imitation, clearly, is llra.
ing out; is slowly giving WI to
deflation."
Are these, and similar forecasts
correct? Up in his offica. on side
walled with mellow glass b1-ci y,
T." is not sure. But supposeJrIceS
have about reached their peak
Suppose the consumers gowias
resistance to higher prices real
ly taking effect? Suppose tie dale
of that mild recession ha been
speeded up? What then?
Well, -. T." telephonesfor his
inventory lists. That pile Of raw
material seemed very |reaona6e
while prices were going up but i
prices really started down. It
would look like a herd o white
elephants. The President { John
T. Rayburn & Sons rubs HI chin
(The SON. incidentally, 3 only
10 years ODD -. T." t%elohones
again. How about that pileof fin
ished products in the storroom'
AS long as prices were gong up
it seemed only a reaSonablehedse
against initiation to hold tim of
the market. But now, hum-A be-.
ter get them moving fast - nl3h'
even shade down the price few
cents in New York to get theft ou!
Thus a different set Of tories Is
suddenly turned loose. The GaAss
can be quite rapid in America once
the idea gets abroad that prices
ahead may be leveling out, O even
turning downward; that the ioo's
wife with a grim look on ha t'c:
has snapped her pocket0odA and
gone on "strike."
From Mr.. Rayburn's view ,hs-'
are certain compensations. Re y
thinking about the labor uni IN VI
his plant. By II means or ao~
er, strikes have been aVerteoo~
ing the war and he is PROUD a."
but there has been a definite uoG
down of individual production N'
been worse recently. FultheIho's
he is aware, as every other Ans.
can manufacturer has been o.
gathering movement for a rev W
ward wage drive; the papers DSn
been full of talk Of new T''.
in Detroit" Well, will it coTe''.'
Mr.. Rayburn meditates. lno's
ion leaders will be pretty I. w.,
Che reflects if they try 10 y"
higher wages at a time "As1
economis trend is losing sps''
going downward. Il.
There could be a labor s~:
in this town in almost no u".,
all if the presumptivc MID
sion slowed up. Would it be a ~