Madison County Democrat. (London, Ohio) 19??-1958, 1950-10-27
Position OF
Retail Trade
Broadcast by Russell |. Haley,
Senior Research Assistant,
Federal Reserve Bank of
Cleveland


Retail sales are still very high
judging by ordinary standards,
and the present position of retail
trade can correctly be described
as sellers markets" 1t is true
that the tremendous buying rush
which followed the outbreak of
war in Korea has in large part
subsidized, but it should be remem-
bered that this episode was spread
over approximately two months,
that it reached proportions which
had no historical precedent, and
that the total consequences of that
squirt have not yet been fully felt.
Almost all types of retailers
shared in the special Summer
bloom. What happened in depart
ment stores can in this instance be
taken as fairly representative of
all retail trade, although recent
fluctuations in department store
trade have generally been more
pronounced than in other branches
of trade.
In terms of dollar totals, depart
ment store sales are running
higher this Fall than they did in
the Summer, as is always the
case. But if allowance is made for
the seasons, July sales of Fourth
District department stores reach
ed new record high, approxim-
ately Is percent above the pre-
vious record which had been
reached in October 1948. The un-
usual buying wave subsided grad
ually during August For the
month of September as whole,
Fourth District department store
sales were about IL percent below
the July peak but still approx
mated as high as the peak month
of 1948, after adjustment for sea-
sonal variation.
The July-August boom in sales
was apparent in almost all de-
partment store lines, although it
was generally more evident in
hard goods than in soft goods.
The sales categories which re-
sponded most vigorously to the
Summer sales splurge were radios,
monographs and television, ma
jor household appliances, floor
coverings, furniture and bedding,
sheets and hosiery. Preliminary
results for September indicate
that consumer buying in most
of these lines is continuing to be
quite strong, but is not SO remark
able for the time of the year as
was the midsummer buying.
Such items as mems furnish
ings and women's ready-to-wear
accessories also responded to the
general buying wave during the
Summer, but the sales fluctuations
in these groups were much less
spectacular in scope. In these de-
partments the most recent levels
are substantially above a year
ago, although not as far above
last year as the previously men,
toned hard-goods lines.
At the other end of the scale
are the mems clothing and wom-
ems apparel groups, both of which
were relatively unaffected by the
buying spree and subsequent slow
ing of sales, although even in
these more stable soft-goods lines
minor gains were made from pre-
Korean positions. Thus it appears
that, although sales of soft goods
have been strong, sales of hard
goods were the backbone of the
Summer sales boom, and are still
playing leading role in retail
trade.
Hard in hand with the strength
in sales of hard goods has gone
an increase in the use Of credit
Much of the war-inspired scare
buying was financed by buying
''on the cuff" Department stores
in this District report that the
volume of instalment sales, which
had been running 25 to 80 per-
cent above year-ago levels in
June, spurted to 50 percen, above
year ago in July and remained
SO percent above year ago for
store-wide sales. Instalment sales
during the latter month set ar
all-timn record as proportion oil
total sales. Evidence available to
date indicates that the consumer
credit curbs which were put into
effect during September have had
only moderate effect on the vol
ume of credit trade.
Charge account sales responded
briskiy to the stimulus provided
by the Korean situation, although
expansion in this type of credit
showed a much slower rate OF
advance than that of mstalmen,
sales. 80
In contrast to the sizeable ex-
pansion in instalment and charge
account sales, cash sales have ex-
perieEced a relatively moderate
growth in volume. Before the
Korean crisis developed, such
sales were averaging 3 or 4 per-
cent below the 1949 level. Their
in July cash sales rose IL per-
cent above the year-ago figure
for the comparable month and In
August they were s percent above
last year.
The volume of collections on
hnfh nhoruo and incf q l.,aa.a4 "a