Milford chronicle., 1948-07-09

individual National and Entsrnational 4
Problems Inssparabls from Local Welfare
Late in June, the Federal Re-
serve Board released its third an
nual Survey of Consumer Finances.
This study, which is prepared by
University Of Michigan research
center, is designed to find out what
typical families want to buy, how
their finances shape up, what they
think of the economic future, etc.
It is based on interviews with sew
eral thousand spending units"-a
spending unit being defined as a
group Of people living under one
roof whose incomes are pooled.
According to a Business Week
breakdown Of the survey, IF con-
sumers make good their intentions,
1888 is going to be even bigger
than 1947 in purchases of houses,
automobiles, and other durable
goods Two years Of postwar pro-
duction have made no dent you can
see in the backlog of demand.
For example-the waiting market
for automobiles is in the S8,000,-
100000 bracket housing expendi-
lures may run as high as $19,000,-
000,000; consumers who want fur
niture, washing machines and
other durable goods apparently
are ready to spend between $3,O00,-
100000 and $4,000, 100000 before
the dawn Of 1949.
Crre-r e.1,xrfrs4r rsso7tHo1 <4D..o r.,a4ri
enter into consideration of these
findings. The Interviews were Ia
ken during the first two months oi
the year, and in the time that has
ensued there may have beer
changes in the desires and the fl.
nancial positions of mnay potentia
buyers. OF perhaps greater mo
ment, even If consumers are still
able and willing to buy as they an,
tieipated months ago, all of tn,
goods will not be available. Thl
market for automobiles, for in
stance, may approach 4,5O0,OOl
units. The industry can't producr
that many this year, and some o
its top men think it may be lat
1850 before it will be possible t,
walk into a showroom and pick
car Of ones choice off the floor
Also, it does not look as if nev
housing construction will be abl
to come anywhere near meeting
the demand for a considerabl
time to come The other durabl
goods-radios, appliances, etc.
arein good supply, though it is no
always possible to Immediately fin
some particular make and model.
In any event, buying is naturall
conditioned on purchasing power
Here the situation remain
bright The survey found that two
thirds of the spendin CUNTS sti
had liquid backlog-though
was not so large as in 1947. An
there has been a noticeable il
crease in installment purchasing
One Of the most interestin
phases of the survey was consume
opinion of what lies ahead, both fc
themselves and fer the nation as
whole. Twenty-seven per ceI
expect that their incomes will
larger a year hence, 80 per Gel
and only 10 per cent look for
drop, with the balance uncertai
This is a somewhat more optimi
tic outlook than was found in sin
liar sponsored by the Federal r
serve Board in 1947 and 1916.
On the subject of the gener
outlook, AZ per cent are afraid thi
bad times are coming. This t
represents brighter point of vie
than in the preceding surveys.
The survey takes into accou
spending units at all the princip
levels. AS is to be expected, II
reactions varied greatly betwe,
lower level and upper level /
come groups. AS compared wi
the previous year, the Over-$5, %
units showed a heavy increase
projected purchasing. In the u
der-$2,000 groups, on the 9th
hand, there was a very heavy
cline. This is the inevitable /
suit Of the continued rise in price
All in all, however, the sury
supports the widely held opini
that the period of high purchasi
power with near-peak employme
is here to stay for while. VIII
people with money are unable
buy new cars, they will buy us
ones. If they find new housi
scarce or too expensive, they W
bolster the old-home market. A
many of them say they are pl
pared to pay still higher priC
than obtained now.
This and all comparable survt
are necessarily based on a sho
term outlook. No one is will
to stick his neck out on what n
happen over a period of so
years. There has been a stes
decline in family savings, m
marked in the middle and low
come groups. Even so, the cor
try's savings backlog is extrem
high, so the drop hasn't occasion
too much worry as yet.