STATISTICS AND BUSINESS

Press, Volume LXXIV, Issue 22508, 16 September 1938, Page 7

STATISTICS AND BUSINESS

FORECASTING TRADE CONDITIONS

ADDRESS BY PROFESSOR A. H. TOCKER

The great demand that had grown up since the war for statistical information on business and the value of this information In forecasting economic conditions were discussed by Professor A. H. Tocker, of the economics department at Canterbury University ■ College, during- an address on the statistical summaries published by the Reserve Bank of New Zealand to members of the' Canterbury Chamber of Commerce last eveninf. The increase in the publication of such information had been perhaps less in New Zealand than elsewhere, he said, and it had been greatest in the United States.

Business had been comparatively stable before the war, and there had been less need’ for watching change, he said. But with the rise in prices during the war and the periods of boom and depression that followed there had developed a real need for such information. A great deal of economic trouble might have been spared after the war if what was known now had been known then. Professor Tocker said that trade cycles had been intensively studied in America, and it had been found that the first movement was in investments. Business then unproved, and there came, a demand for short term money to finance undertakings. Money rates

then went Up,, and a falling off of investments followed. Business then fell off,' money rates fell, and investment began again. Experts at /Harvard became very confident -in' itKeir predictions, and were able to fix the date of the breaking of /the boom in 1920 to a- few weeks, and the- riseeof the following boom to within a fgw weeks. Their confidence was indicated by an invitation he had received from prominent experts to speculate with a syndicate on the stock exchange on the basis of these forecasts. One or two prominent people in England, he understood, had made money in this way. In New Zealand, he said, it was found that the movement could be traced from periods when there was an excess of exports over imports. The money came first to the farmers, who spent it, and caused an improvement in business, and a greater demand for imports. 'This again led to a period when there was an excess of imports over exports, .and .the lack of money affected the whole country,, (causing ,a fall in the demand for imports. 1 Professor Tocker emphasised 1 the value to the businessman of becoming acquainted, thrqugh statistical information, with the markets, world-wide, national, and local, bn which he depended. He could then follow the course of his individual business, and' see whether it was keeping up to average. If businessmen studied the information available, making allowances for the conditions affecting their individual businesses, they would be able to see what improvements were likely to occur, and be in a better position to take advantage of them. Mr W. Machin, who presided; expressed the thanks of the meeting. to Professor Tocker, who, he said, was a link between practical business and' the academic study' of economics.