NO SIGN OF SLUMP

Chronicle (Levin), 4 January 1949, Page 5

NO SIGN OF SLUMP

( N.Z.P.A.

rReuter*

High Level Of Activity Is Likely To Continue

Qoyyright)

Reeeived Monday 7 p.m. ' LONDON, Jan. 3. Though publie discussion in the United States has been full of anxiet.y for nearly two years, there is still uo serions trade setback in sight, says the Financial editor of the Alanchestei, Guardian. In fact, the recurring suspicion of many Amei'ican businessmen and their economic advis'ers, that trade was about to slacken, has done a greai deal to keep the economy on an even keel. The Marskall plan and increaaing rearmament have helped to maintain the demand. Throughout 1948 employment has been above 00,000,0000 and even at this time when many farni and building workers are unable to work, tlie iigure is still surpassed. It is true that Ghristmas saies at retail stores have been slightly lowei this year than they were last though they pieked up two weeks before the holiday. But as a result of ineessant self-examination of Am^ric^n busines:-, this setback had been foreseen and stocks had been run down for some time both in the retail and wholesale trade. "Soft- spots" have appeared in a number of industries. Cotton and woolkm textiles, boots and shoes, lea-

ther and a few other trades have been cutting down operations. On the othei hand construction, heaA-y industries and capital goods production generally, are still fullv employed. Steel is stil! short, new motor cars are still fetching premiums and business expenditure foi plant and equipment in the llrst quarter of 1949 is expected (by the Departmenl of Commerce Survey), to be about 5 per cent. above that of early 194S. Tlie total of personal incomes; say.the city editor, after rising more from May to August, inereased more moderatelv since then. Prices for farm products are 9 per cent. lower thar. they were a year ago and prices of manufactured articles have been rough ly stabilised since mid-summer. Inflationary pressure has ouce agam abated and a high level of activity i« likely to continue well into 19*49 though it may be, as some Amerieans prodict " profitless prosperity" if Congress carries out Democratic taxation plans.