TRADE REVIVAL.

Taranaki Daily News, 20 February 1922, Page 4

TRADE REVIVAL.

The interesting remarks made recently at Manchester by Sir Charles Mandieberg, one of the founders of the Federation of British Industries, on the subject of trade conditions, are deserving of attention. It may possibly be thought that his belief in a sudden revival of trade is over optimistic, yet the reasons he gives for that opinion are such as may fairly be considered to be sound. Practically his views on the main factor dominating such a revival are the came- as have bebn. expressed again and again by others who have carefully noted the facts connected with trade depression, namely that it is the cost of production which makes or mars trade. He points out that the difficulty the manufacturers have to face is not the cost of the raw materials, which are now low in price, but that the cost of production remains high owing to the small output relative to the overhead expenses, and to the restriction of output obtaining in some industries. He was therefore glad to. see signs that labor was recognising the fallacy of this i policy, for when costs were decreased through increased output and prices placed on a more reasonable and stable basis, he considered there would be a considerable increase in the demand. When business becomes a hand to mouth affair trade is bound to be dull, and it cannot foe expected that large orders will be given to manufacturers when there is a fear of prices dropping whereby losses will probably arise. Once overcome the high cost of production and bring commodities within the reach of the consumers, whose spending power is more restricted than formerly, there ‘need be no fear as to the demand necessitating the maximum output. Competition will then become healthy and vigorous, and people will be able to obtain their requirements, much to their satisfaction. It is, therefore, .gratifying to have some hope held out that in the not distant future trade will regain its pre-war activity, but in order that such a desirable event may happen, labor will have to co-operate, for only by that means will prices come down materially.