The Daily Alaska empire., 1947-06-07

pened last tme-how last springs 18lz -cent wage increases ballooned the lid off OPA ceilings and brought sharp advances which only now are being reversed in some lines.
 It is of course conceivable that such thing could happen The picture is not yet clear. It may be before the actual outcome can be determined but there already hints of what may be in store and they aren't at all unfavorabe.
 The steel companies apparently will try to hold the line prices, despite the wage increases U S Steel which started the 15-cent pattern for wage boosts. announced increase in steel prices. Jones and Laughin stees fourth largest adopted the wage pattern without price increases. The chairman of Bethlehem Steel indicated price increase when he said he would give a S3 price reduction than to raise wages that amount. leading steel trade pub lcaon says the wage increase hes removed any pos sibility of an immediate reduction in steel prices but it expects 'some easing" in the price structure later in the year Scrap steel is taking a nose dive after its recent sharp uptrend. The chairman of American Smelling and Refining-and he ought to know-says that prices of other metals nave reacheu their peaks and the next movement will be down ward.
 In the automobile industry which relies on steel, General Motors and Chrysler have adopted the wage pattern without price increases.
 Here two major industries-steel and auto mobiles which have boosted wages but not prices, least not yet Both have been running in high gear which means big profits. If they hold the line, it is likely that most of their business rivals will do the same-competiton will be a big factor in deciding that
 General Electric, adopting the pattern increase, announced Q T per cent price increase less than half the wage increase. The General Cable Corp on the other hand, boosted wages and, at the same time, reduced prices,
 There you are: Of six major companies raising wages one reduced prices four made change and one riised prices 2 per cent Some companies will increase prices along with wage boosts they will nave to- But there probably a lot of others that won't capacity operations will permit them to absorb the increased costs.
 For many companies the first quarter of the year was the peak for such earnings and it will be long time before business generally will that much again. But those big earnings will provide cushion to help hold the line price increases.
 The price trend in non -durables as we have said, has turned downward. The price trend in durables, or hard goods has yet turned downward, except in isolated cases such General Cable and Interna- tional Harvester but this is normal pattern for a recession the early stages of recession all prices do not drop together First it's one then it's another finally all join in but takes time for that point to be reached.
 Non-d,rables usually take the lead, just as they are doing now; they are usually well along the re- cession curve before the durables join them It may be one month two months, three months, before the durabes get into line, but trade journals of some durable industries in steel, hinting at price cuts ater-an indication that they expected The chances are the increases will merely delay them.
 If business generally should go into an orgy of price raising later the outlook would be changed but it doesn't look that way at this early stage of wage boosts.