Evening star., 1950-08-06

dex was 264 on June %. BY July
81 it had shot up to 302.
In connection with the report,
the BIS issued this warning:
"These price movements tend to
be typical Of war situation in
sensitive markets. If the high
prices of raw materials persist, in
creaSes in the prices of finished
products, both at the manufac-
turers' and retail level, will be
hard to resist"
Among the % commodities used
in the index are coffee, cotton,
copper, corn. hides, lead, rubber,
silk. sugar, tin, wheat and wool.
The bureau also reported that
retail food prices were up 5 per
cent since April, with half the rise
coming between June Is and July
Is. That puts the level less than
6 per cent below the postwar
peak. Meat prices, which in
creased IA per cent, were the main
cause of the rise.
Meanwhile, the Dun & Brad
street wholesale food price index
recorded rise for the seventh
straight week and is now at $6.53,
the highest point in % months.
The index is the total of the
wholesale price a pound of 81
food items.
Store Sales Soar
Scare buying is perhaps no
where better reflected than in the
Nations department stores. Ac-
cording to the Federal Reserve
Board, department store sales for
the week of July % were 46 per
cent above a year ago-the great
est increase ever. One large WASH
ington store was reported to have
doubled in one recent six-day
period, its total sales in the pre-
Christmas week last year.
Industrial prices have not been
laggards. After a slow increase
early this year. they have moved
up at a progressively faster rate.
Between April and July the rise
was 4 per cent, only is per cent
under 1948's record level.
Building materials, metals and
metal products prices are at or
near their postwar highs, and
lumber is setting records each
week, the BIS said a couple Of
days ago.
Another factor which has
played part in price increases
has been the matter of invento-
ries. The Federal Reserve Bank
of New York in its latest report
declared:
Many manufacturers. mer-
chants and consumers, anticipate
ing that the crisis originated by
the invasion of Korea will create
shortages and bring on further
price increases, are apparently
attempting to build up their
stocks or to replace some types
of goods before they would nor
mally do So"
And the National Association
of Purchasing Agents said in one
of its reports that the trend of
inventories is up, with 40 per
cent Of the executives listing in
creased industrial stocks during
July. A brisk rise in orders has
developed new high in back
logs, it said.
Rush for Housing Materials
In some cases the sky has been
the limit on inventories. Thus.
one New York used-car wholesaler
wired his supplier to grab all the
1949 and 1850 Cadillacs he could
get his hands on. He explained
that ne wanted to put them in
storage until the time was ripe for
a killing.
Shortages in housing materials
have been reported as a result of
some builders and suppliers stock
ing up.
Commodity prices, despite
abundant supplies, also have been
upward since Korea.
AS for wages, principal fac
tor in the consideration of prices.
the Labor Department reported
the average weekly pay of a
worker in manufacturing at an
all-time high of $3.50 in June.
The stock market, after a series
OF declines in which billions in
values were lost during the first
days following the invasion of
Southern Korea, has snapped
back. Led by the so-called war
babies" (aircrafts, oils, steels.
metals, etc. it has just about re-
gained the level it held as a whole
On June Is.
With little of the initial $40 bill
A1OAA w NC oHC11I Oll TedTmamenG
actually having trickled down to
industry, some observers are pre-
dieting a rising market.
Many investors, however, have
Jumped onto tax-exempt State and
city bonds and have sent prices of
these securities soaring.
There are two final notes which
round out the imitation trend &C.
5ure. The Treasury Department.
reported the total amount of
money in circulation rose from
s27 ,089, ,799,544 on May 80 to $27-
Isl, ,290,042 on June 80. And the
National Industrial Conference
Board reported the purchasing
'alue of the consumer dollar. using
January, 1889, as 100 cents. was.
'1.7 cents in June, a decrease of
l cent since June, 1949.
Some economists review the sit
latlon as outlined above and saw
hat we can no longer stop inf1a-
ion, but can only slow it down.