ECONOMIC OUTLOOK

Wairarapa Times-Age, 19 July 1938, Page 4

ECONOMIC OUTLOOK

MAJOR DECLINE UNLIKELY. Economists seem generally to agree that a major decline is unlikely for the present, writes Mr Harold Butler, director of the International Labour Office, Geneva, in his annual report. The very rapidity of the recession in the United States makes an early resumption the more probable. Apart from the over-riding political uncertainty throughout the world, all the factors are favourable to a resumption of activity once a modicum of business confidence has been restored. More than 90 per cent of the international trade of 1937 was done between countries . whose exchanges had attained a “defacto” stability. A number of

States have mace a beginning with the resumption df debt service. The first steps have been taken toward making possible a renewal of foreign investment. Although some 200 clearing agreements are still in existence, many of them have loosened the bonds of exchange restrictions by following the model of the Anglo-German agreement. All these symptoms point encouragingly toward a new currency alignment and a fresh impetus to international trade. Though there is still a long road to traverse before the world's economy has been reorganised on a new and stable basis, the outlook would be by no means discouraging if the spirit of international warfare could be banished from economic and political relations.