Evening star., 1949-04-03


Many goyeTnment experts.
watchers. stlu insist lnflatson Is tht
authoritative observers would aim
bae guns al caneeT Of cefIatlcn
While neither camp offers ffss
predictions. both hold 10 wall
and see attitude until Apgn makes
It's marx IN store Salss man1Hae~
turing output. unemployment and
price and vase trends
Proba bly, the most significant
sign Is the lneyeaS!ng attention
that some administration aides
and cong:essloua4 staff wo; keys
give 10 devl>lpg weapons :og
prompt. effective Use Il the current
dlslnaauon" SWe'NeS uumastak
ably toward a depression
Such studies aIt nol being
shouted from the house tops. cSpe-
clally the White House. az from
the Capitol dome They neverthe-
less are gong forward yust IN case
They are put Up As one form OF
preparedness. political as we'll as
economic. 10 meet preSSuFes that
unQuestionably would hit quickly
and hard from various quarters II
denationary forces tried 10 take
over.
Form OF Preparedness
7 Responsible leaders in and out
OF the Government spread long
] impressive list OF facts and factors
to support their belief that the
Nations economy remains funda-
mentally sound, AT the same time
they note unfavorahle and unclear
shifts
They coin such descriptive terms
as recession" or 'leveling of or
''declination" or drop from the
peak" or scattered little depres-
sions" or "quigCles" Of the sort
that have occurred about six times
since l945.
/ Reasons they cite for optimism
are. for the most part, well known
They have been repeated often
enough but that doesn't mean they
amount to whistling in a def'a-
tionary dark. Some Of the rea-
sons are:
| Generally high level OF income
scarcity of many items. such as
automobiles and houses; shortage
Of numerous manufactured prod
ucts. such as steel; large Govern
ment spending. low borrowing
rates. foreign aid and defense pro-
grams and large backlog OF per-
Sonal savings.
Defiation Shoppers
/ Some OF these and other con-
ditions caused President Truman
TO ask Congress for an anti-infia- .
ton program. including standby
power to curb prices and wages,
ALLEGATION authority and $4,000
900 900 In additional taxes.
The administration gives no
indication OF lowering its sights
from q primary anti-infiation TO
antidefiation target. In fact. Mr.
Truman has served notice that
he will not give ground on his de-
mand for economic controls and
higher taxes. But II has given
several recent hints and at least
two concrete actions designed 10
discourage deflationary tendencies,
| First was approval OF the Fed
eral Reserve Board order easing
restrictions OF installment buying
by allowing some retail goods pur-
chasers q longer time 10 pay and
cutting the down payments,
/ Secondly. the Federal Reserve
Board. within the last few days.
reduced the margin requirement
for stock transactions from rs 10
so per cent. The revised reaula-
ton enables investors or speculs-
tors TO pay only so per cent cash
for securities.
/ That move Immediately aroused
q beilef that 0eflaLion was con-
siderably closer than imitation In
the national economy. In any
event, 1t lent fuel TO the fire on
the question: Whittier do we
/ tend?"
/ Then came reports that the
Presidents Council OF Economic
Advisers is so greatly AZ odds on
economic philosophy as well as
procedure that Chairman Edward
@. Nourse has threatened TO re-
sign. He has maintained that tfle
current situation is a healthy
disiniiation His colleagues. Leon
H. Keyserling and John II. Clark
have been more inclined 10 sd-
vocate curbs against the imitation
menace.
F.. Congress has indicated II Is
thinning more nf deffatinn fSoEsi-