U.S. TRADE RECESSION

Chronicle (Levin), 30 July 1949, Page 5

U.S. TRADE RECESSION

Press Assodaiioni

General Situation Does Not Approach Crisis

(Per

Received Fridav, 7 p.m. NEW YORK, July 28. The recession from postAvar business peaks in America has been "orderly and for the most part benefieial, " the Federal Reserve Bank of Philadelplua reported today in its midyear anaiysis of fhe country 's business. Rumming up, the bank said the drop in employment and priees might not present a pretty picture, but tnese declines were neeessary corrections of the distortions ereated by World War Two and the postwar period. The bank noted declines in production during the j first lialf of 1949 with resulting ae- , creases in employment, but said unera- 1 ployment has not yet reached Avhat was regarded as the danger point as m 1 many previous recessions. The report admitted that some communities have been hard hit by unemplovment, but added: "There are stiii {>0.000,000 people at work and the | general situation does not approach a crisis." It was no surprise, the bank said, that the recent declines in employment, production and income had taken the edge off consumer spending, ' ' but insofar as we can tell the people s saving habits of last year are continuiug into 1949." Prices have been in general retreat since August 1948, but the price or laliour, one of the least quoted but one of the most important prices, has changed verv little during the lirst lialf of 1949, the bank added. "Though it is often claimed that the Government is undermining business confidence, there is actually great confidence in the Government on the part ot" the general publie, including many businessmen," the band said. Labom iunions would be iiifluential in sliaping j future events and wholesale wage1 cutting such as was praetised in the earlv t\A'enties and thirties appeared to be a thing of the past.