Evening Star Newspaper, December 31, 1924, Page 19

THE EVENING STAR, WASHINGTON, D. ¢, WEDNESDXY, DECEMBER 31, 7922 19 " National Politics Play Very Powerful Factor in 1924 Business and Finance Business Curve During 1924 Shows Extremes High and Low Outstanding Feature Toward Stability Came Near End of Year, When Agricul- tural Products Reached Profit Prices. BY. J. C. ROYLE, The business year of 1924 had al- most as varied a course as a roller coaster. 1t was marked by high peaks and depressions. The most striking improvements came as the year drew to a close, and served to raise earnings of many basis lines to a point but little under those of the re- markable year of 1923. The fact re- mains, however, that production of many raw mat rials fell off in the last twelvementh, a smaller volume of goods was sold, and prices in gen eral for manufa tured product showed slight de- j ¢ ROYLE. clines, ol § The important thing is that when the year ended the buying power of the country had shown marked Im- provement, demand was reviving, em- ployment was on the increase, and production of both raw and finished materials was being forced closer to plant capacity. These facts gave a surance that business was on a sound and healthy basi: nd that trade, commerce and industry could be counted on to maintain a high level of prosperity t least throughout the early part of 1 Weak Spots Strengthened. There are still some spots in the business fabric where the margin of profit has been worn so thin as to be almost threadbare, but even these have been reinforced and strength- ened in the last two months. Also lined which did not show satisfactor: DProfits improved their technical posi tion in many cases by discounting in- ventory losses and adjusting them- selves to new levels. Marked improvement has been made by some businesses in cutting pro- duction costs. Individual efficiency of workers has been increased, over- head has been lessened, and methods of distribution have been improved. Efforts in th direction have sulted in many consolidations mergers of companles in similar of business endeavor. Main Factors of the Year. Unquestionably the most important feature of the year was the improved condition of the farmer. This was most strikingly exemplified by the wheat growers, who have struggled on for some. vears with little or no profit to reward their efforts. This year, however, the United States crop was cstimated at 870,000,000 bushels, as compared with 786,000,000 bushels in 1923, while elsewhere in the world vields were short. As a result, farm- ers who had to accept prices as low as 75 cents a bushel on the farms last year sold their wheat this vear at an advance of 30 per cent or more, and some got $1.25 to $1.50 a bushel or higher. The corn crop was 600,000,000 bush- els short, compared with last y and prices shot up well ove consequence. Farmers who sold their corn direct did excellently. The fu- ture trend of live stock prices must tell the story of whether those who fed stock and marketed their corn in the form of beef and pork made money or lost it by that procedure. The cotton crop, expected carly in the year to be scarcely large enough to mcet world requirements, improved remarkably after Midsummer, and planters realized sufficient from the increased yield, now forecast at 13, 153,000 bales, to counter-balance lower prices than those obtained ear- lier in the twelvemonth. Tobacco men had a fine vear, dairy farmers were fairly successful, and many fruit growers showed large bal- ances on the right side of the ledger. Buying Power Augmented. In consequence, hundreds of mil- ltons of dollars were added by agri- cultural products to the buying power of the nation. Conservative statis- tictans place the increase in the na- tional wealth from these products during the year at $12,816,000,000. This means that cach of the 6,400,000 American farmers produced approxi- mately $2,000—the total exceeding ag- ricultural production of 1923 by $612,- 000,000. On this basis the average farmer is just about 450 per cent Detter off than in 1921. In view of the advance In farm product prices ‘and the decrease in those for manufac- tured products, the farmer’s dollar is Wworth at least 10 cents more than it was last year. The importance of this improve- ment is readily understood when it is remembered that the farmers absorb a tremendous percentage of the lum- ber, steel, concrete, tile and other commodities produced in this country; that they have plled up needs for materials which they have not had the money to buy for some years, and that many of them settled up old debts and are in excellent condition financially. A and lines ‘Weather Important Factor. The weather played a prominent fact In the ups and downs of many nes of endeavor during the year. It helped wheat and cotton, but it hurt rorn, fruit, live stock and some other products. It also served to delay or check entirely buying of certain sea- sonable goods in the dry goods, cloth- ing and textile industries. . Some sections had too much rain end some too little. The Spring and early Summer were cold and the Fall was warm. Some of the delayed demands were filled later, but a part of them were blotted out entirely, with distinct ef- fect on retail trade. Activity After Election. It was a presidential year, and few realized what a deterrent effect this had had on commerce and industry until election was over. The day after the ballots were cast business took on a new lease of life. Orders which had been held up for months were placed by wire. Shipments on old contracts which had been held back were released. Advertising campaigns which might have been abandoned or curtailed were put into actlon. Mills and factories speeded up output and raw material men took steps to Improve production. The activity was healthy activity. It did not hold the danger of infla- tion, but represented a legltimate change in the ratio of supply and de- mand. It was reflected in a tremen- dous increase In the prices of securi- ties on the stock exchange, but this fact dominated or influenced few pro- ducers. Many excellent authorities indeed feel that the {ncrease in values shown in December trading in the stock market discounted improve- ments in business for a good many months to come. Therefore, business made haste slowly, content to keep production in close touch with con- sumption. The acceptance of the Dawes plan for the rehabilitation of Europe ex- erted a-tremendous-influence on sen- timent. It is still too early in the operation of the plan for it to have a dominating effect on physical produc- tion this year, but business men have come to realize that prosperous for- eign customers are a necessity if Americans are to continue prosperous producers and merchants, It is ex- pected that the working out of the plan will have an even greater bear- ing on business prosperity in 1925. There is no question but that some business men misjudged their mar- kets. This was strongly apparent in the automobile and textile industries. it even so, few of them rushed into their mistakes with sufficient reck- lessness to make it impossible for them to retrieve their position before the vear ended. The buying public, was cautious. Even the farmers, with unwonted prosperity in their grasp, gave keen consideration to their purchases. There was no orgy of buying such as took place in the inflation years. On the contrary, strong buyer resistence developed in every price advance. As a consequence, competition was se- vere, and retailers and wholesalers allke began to demand that their sales forces should be salesmen, not order-takers. Credit Structure Solid. These conditions had a strong and salutary effect on the credit structure of the country and on the condition of the bank The latter seldom have been so strong. Mid-West institu- tions, which were on the ragged edge for some yea have more money at their disposal than they can place. Crop movements have been financed amply and without difficulty. There has been no lack of funds ranted industrial expansion. tors placed their funds in hundreds of millions of dollars in foreign and domestic bond issues. In no fleld was this more marked than in public util- ties, where necessary financing was accomplished to a heavy extent with- out difficulty The year was remarkably free from startling commodity price fluctua- tions, but toward the end of the an- nual perfod prices ‘in many lines turned definitely upward. Commercial failures increased some- what during the first three-quarters of the year. But money was easy, and interest rates on commerclal paper and time loans was held to a low level all during the period. Railroad Efficiency High. Railroad efficiency contributed large- Iy to the successful results of the year. Car loadings were heavy, al- though somewhat under those of 1923, but the roads were well equivped, and they increased the loading of cars and the tonnage per train and de- creased delay in transit and at termi- nals. As a result, merchants were able to continue the policy which they have found so successful of buying frequently in small quanti- ties rather than stocking supplies for months in advance. Actual and pros- pective railroad consolidations played an important part in the situation of the carriers, and will continue to do 80 in 1925, The express companies did a record business, and parcels post shipments were tremendous. The moment elec- tion was over the railroads branched out in programs of replenishment and expansfon for equipment, which piled up a kuge volume of orders with steel and lumber concerns. Passenger travel was extraordinar- ily heavy. Tourists in droves visited the national parks and plavgrounds of the country, and yielded a tre- mendous revenue to the sections in- voived. This movement was aug- mented and sustained by a regular, systematic and welghty volume of rallroad, municipal and State adver- tising. As a result, the construction of hotels and accommodations for travelers was at a high rate. To this fact the floor-covering manufacturers owe much of the volume of their 1924 business. Building Fails to Slacken. Building construction again pressed close upon the $5,000,000,000 mark. It has become evident, however, that the housing shortage in some of the more populous centers has been filled to a considerable extent. The trend of construction now is turning toward the rural districts and the smaller cities. A distinct shortage still ex- ists in general, however, and this is not likely to be overcome in 1925. An enormous volume of repairs and new bulldings are needed on the farms, and building material men an- ticipate no falling off in demand, in view of the expansion necessary to accommodate normal growth. Taken all over the country, wages in the building trades were s ightly higher than in 1923, but wage scales have been well stabilized by con- tracts between employers and em- ployes which have more than a year to run. Costs of bullding declined sligl.tly, due to cuts in bullding ma- terfals. ' Rents showed comparatively little fluctuation. The open Fall and adoption of improved methods of Win- ter construction served to keep the volume of building high until the turn of the year. Fortunes in Real Estate. There was a remarkable increase in real estate values in cities all over the country. Fifth avenue property in New York sold at the highest rate ever recorded In the city—$304 & square foot. On the other side of the continent transfers of 10 pleces of downtown property in San Francisco, seleoted at random, showed profits of $1,999,000 on investments of $637,000. Returns on individual parcels of land In the city range as high as 136 per cent. But even larger fortunes have been piled up by transactions in su- :::—'ban ln;one‘r(ydlnd the opening of residential iy istricts in scores of This advance In values has foll an exodus from the cities of thoug‘:le: sirous of owning their own homes. Many of the most successtul Operators in suburban real estate have been women. Activity in farm land sales was noticeable, with prices generally higher. The insurance business has had another remarkable year. In life in surance the number of policies fell somewhat below that of 1923, but the total amount for which the polictes were written showed a gain. The in- crease in new buildings favorably affected the volume of fire insurance, and the volume of industrial and group insurance also increased. Hotels Are Prosperous, Few complaints issued from the hotel owners and operators during the year. Prices were on a stable basts, and volume of travel provided a steady flow of guests. Perhaps the most striking disappointments were found in the failure of the two na- tional conventions to attract the number of visitors expected. Hotels found a somewhat unex- pected. source of big revenue in the year's sporting events. Base ball drew record crowds, especially for the world series. The foot ball games attracted crowds which jammed stadium, every BUSINESS LEADERS WHO PREDICT INCREASED PROSPERITY FOR 1925 HARRYS S EWING~ Left to right: Elbert H. Gary, chairman of United States Steel drectors; Walter C. Teagle, president of St P. Sloan, jr., president of General road Board. UNDERWOOP. & UNGERWEOD: dard Oil Company of New Jersey; Alfred otors; William E. Knox, head of American Bankers' Association; Julius Kruttschnitt, chairman of Southern Pacific Rail- Industrial Leaders See Prosperity Ahead By the Associated Press. NEW YORK, December 31.—High hopes for 1925, in some cases moygting to conviction that it may prove. the greatest vear In the history of Amer- fcan business, are held by various leaders in basic industrial and financial activities here. Forecasts for the new year ex- ssed by these executives agree upon the seeming certainty of a substantial prosperity. They appear further to agree for the most part that the out- come of the last presidential election and the favorable working out of the Dawes plan should prove major con- tributing factors. They also bank heavily upon the fortunate colncidence of great purchasing and great produc- ing power at home and upon the prom- ise of a wholesome recovery and expgn- sion in markets overseas Gnry Sees Great Prosperity. Elbert H. Gary, cnatrman of the board of directors of the United States Steel Corporation, expresses as follows his confidence in the coming 12 months “If the policies of the present admin- istration shall continue in force and practice, and the American Congress is reasonably disposed to co-operate with the President, and the business interests of this country will likewise be dis- posed to support the administration in its efforts to assist the business of the country, the year 1925 should show the highest and most satisfactory pros- perity in the whole history of the United States.” *The business of the manufacturers of the iron and steel industry of the United States during the vear 1924, up to the date of election, was rather dull and depressed,” Mr. Gary declared. “The election has had a marked effect upon the steel Industry. A ost immediately the demand in this country began to show improvement in volume, and this condition to some extent had a favor- able influence on some foreign coun- tries. At present the demand for the iron and steel products manufactured in the United States is large, persistent and satisfactory. “The New Year will probably com- mence with all of the manufacturing plants - operating at full capacity. Also selling prices have advanced to a considerable extent and should af- ford reasonable profits sufficient to continue the wage rates at the pres- ent standard. These were not reduced during the dcpression notwithstand- ing they were not justified by the results of business.” 1925 Ralilroad Outlook. American railroads -enter upon the new year with a hope that the trans- portation act will be so administered as to accomplish what it was designed to do, i. e., by efficient management al- ready attained to earn the statutory income, which has never vet been done. Julius Kruttschnitt, chairman of the executive committee of the Southern Pacific Co., viewing what lay ahead of the rallroads, said: “At the pr sands of dollars were spent on tick- ets, transportation, clothes, hotels and amusements by those who attended each big game. As a result, hotel managers are encouraging the sport by every possible method. Sports Yield Big Revenue. Sports played a big part in busi- ness throughout the year. Golf has taken a firm hold on the American people, and millions were spent not only for new courses and clubhouses, clubs, balls and other paraphernalia, but in sport clothing for both men and women. This latter item formed one of the reliable props which held up the clothing industry during the year. Sporting goods manufacturers had an excellent season. The old reliable circus continued to be the biggest drawing card in the amusement fleld. The moving-pic- ture industry had a fairly satisfactory year, while the speaking stage drew Tecord-breaking audiences, and heavy investments were made for new thea- ters in the larger citles. The volume of advertising through- out the country was maintained at a high average. Most firms determined on thelr advertising appropriations for the twelvemonth early in'the year and stuck to them. Trade Balance Favorable, The United States sold more goods to foreign countries than in 1923, and bought less goods from other nations. As = result, the favorable trade bal- ance of the country advanced to nearly $500,000,000 before the end of the year. Kxports fell off somewhat from the high levels of the early year in Midsummer, but in September they took a decided Jump and were main~ tained at a high level from that time on, surpassing those of 1923 by nearly 7 per cent, despite political disturb- ances in Latin America, China and elsewhere. A tremendous volume of cotton was sent abroad, and copper shipments also increased. Export automobile trade showed betterment in the Fall, as did shipments of electrical equip- ment and radio supplies. It is ap- parent that imports to this country will be heavier next Spring, and this will cause expansion in exports, since foreign countries will have the money to buy more American goods. Shipping Situation Unsatisfactory. The shipping situation still is in a somewhat unsatisfactory state. Sur- plus tonnage was reduced consider- ably and operating companies were successful in cutting expenses, but estuaries still are crowded with laid- up Shipping Board vessels. Volume of ocean passenger trafic was heavy throughout, divided fairly well be- tween journeyings for busine-« and pleasure. There is no doubt that the development of the Diesel engine in America, the improvement in elec- tro-turbine ofl burners and the in- vention of the rotor ship give prom- ise of improvement in the coming year or two. Power Demand Strong. Production of electrical current reached the highest point ever known in this country. When final figures are compiled it is estimated 1924 pro- duction will equal or exceed 70,000, 000,000 kilowatt hours. Many new Hundreds of thoeu- hydro-slectrio plants were oompleted end of the war the public pronounced emphatically against Government and in favor or private ownership of ratl- roads. In its transportation act it [determined to secure: “Adequate transportation facilities to keep pace with the growth of the country ~ through the agency of privately operated railroads by pre- scribing rates that would secure a railroad income sufficient to raise capital for nceded facilitles. “Freedom from interruption of transportation by creating a tribunal to settle controversies with labor, on which it retained the balance of power. “Because,” Mr. Kruttschnitt con- tinued, “the act has never been al- lowed to function freely, neither aim has been attained.” No new laws should defer a rea- sonably permanent adjustment of the interests of the public, the raflroad owners and labor, according to Mr. Kruttschnitt Dangers in Oil Industry. “We are nearer the high road of returning prosperity.” said Walter C. Teagle, president of the Standard Oi] Company of New Jersey, “if we frankly admit that most of our trou- bles are of our own making; that we are all in varying degree responsible, the larger compani inciuding the one I represent, perhaps in greater proportionate degree—that none of us is able to say ‘I told you so,’ and that of us all, the producer of crude is perhaps the least to blame” He expressed solicitude in the light of 1924 experience in what he said was a distinct overproduction in the oil industry. He called the disposition of 530,000,000 barrels of crude oil and its products now in storage in the United States a pressing problem. This overproduction, Mr. Teagle sald, was in part due to these vast stores of oil themselves which had been ac- cumulated at higher than® present prices, and, in being under-sold by current productlon, had fafled to stab- lize the market. In part it was due also to the fact that gasoline was producing more power per gallon through im- proved production science. Then, a considerable portion of the requirements of gasoline were belng supplied by sources other than straight- run gasoline, such as casinghead gaso- line and.cracked gasoline. The influx into the oil industry of war millionaires had beosted production from 1,186,000 barrels in 1918 to 2,930,000 barrels in 1923, Finally, modern transportation had brought production to the doors of the great refineries. Isolation of any great producing field was now made im- possible. Knox Sees Bright Future. “The people of the United States have seldom if ever been presented with a greater promise of prosperity than to- day if many of the current business analyses and forecasts are to be taken seriou: said William E. Knox, pre: or are in course of construction. Drought had an effect in some sec. tions, but superpower hook-ups in the manufacturing districts prevented any serious check to industry. The central power output was improved by increase in the use of electrical household utensils and refrigeration by electricity, and profits to current and power producers were at an ex- cellent rate. Gas production continued to improve steadlly, aided by the number of new dwelllng erected and equipped, and rose well above 1,000,- 000,000 cubic feet a day. Highway construction went on at a tremendous rate, and programs for the coming year bid fair to be even more extensive. Traffic has become 80 heavy, both on streets and high- ways, that additional paving and road building has been imperative. This has been made easy by the fa- cility with which such projects have been financed. ‘Trafiic Problems Pressing. More attention has been given to traffic regulation than ever before. Congestion on city streets and coun- try roads has become terrific with the increase in the use of motor ve- hicles for pleasure and business. Nearly every community has made some effort to work out a system of regulation which would permit free- dom of movement and at the same time avoid curtailing business of merchants and shippers. Parallel highway routes are being constructed all over the country to take the strain off the main arteries of interurban traffic. This road work, requiring expendi- ture of more than $1,000,000,000, has played no mean part in the employ- ment situation in the country this year. In general, employment has been excellent. There have been few strikes or tie-ups, and these have been largely local in character and involved jurisdictional matters to a greater extent than wages. The un- doubted slackening of industrial ac- tivity in the second and third quar- ters cut the number of workers on the payrolls of mills and factories sharply in some instances, but these released workers apparently Wwere quickly absorbed by other lines. Textile Workers Saffer. The 1924 crops were harvested without disastrous shortages of har- vest labor or unexpected surpluses. When the work in the flelds was over these itinerant laborers drifted to railroad and highway developments. Two lines were exceptions to the above. The coal miners in the bitu- minous flelds were out of work for months or enabled to work only a few days a week. The textile workers in New England were affected by cur- tailments and shut-downs in the mills. ‘Wages were cut sharply in some New England textile plants toward the end of the year, but a higher rate of employment prevailed. Conditions in the mines also improved as cold weather approached. The fact that savings accounts {ncreased materially during the year indicates that the employment situation in general was satisfactory, and that the buying power of the workers remained unin- jured. Wages remained high in most industries. No review of the year would ba dent of the American Bankers’ Associ- ation. “There are several main factors,” Mr. Knox pursued, “fo which this favor- able outlook is attributed. One is the fact that we have won political peace, with an administration that guarantees economic sanity so far as the National Government s concerned. Another is that our banking and monetary sit- uation was never in a better position to serve expanding business. Indus- trially also the country has ample plant capacity equipped with modern and efficient machinery. Conditions in em- ployment and wages are such as to in- sure large buying power from the gen- eral public. In agriculture the position of the farmer has heen improved by splendid crops and good prices. Financial conditions in forelgn coun- tries, whose purchases are required to take up the slack of surplus production of this country, promise better forelgn markets. “Granting that this optimism is soundly based it may be pointed out that there is one other factory as im- portant as any of the foregoing if we are to have an era of prosperity that will continue for any length of time. This factor is the mental attitude of our people and the consequent use they make of the opportunity of pros- perity that is presented? Copper Outlook Encouraging. The outlook for the copper indus- try was deemed “most encouraging’ by R. L. Agassiz, president of both the Calumet and Hecla Consolidated | Copper Company and of the Copper and Brass Research Association. He saw no indications of abatement in the domestic demand, and said the situation abroad was “steadily im- proving.” “The domestic consumption in 1923, Mr. Agassiz said, “was the largest in the history of the indus- try; nearly one and one-haif billion pounds. This year's consumption has been going at even a higher rate. In spite of the fact that production has increased very materially, the total stock of available copper has decreased considerably since January 1 last, oging to the large refinery de- liveries. ¥ Copper exports in 1924 now closing shouid exceed one billion pounds, Mr. Agassiz expected. This would be a 25 per cent gain over the annual figures of the last thres pre-war years, and would be accomplished despite Germany buying only two- thirds as much as before the war. “With world production and con- sumption of copper running pretty close together at the present time” caid Mr. Agassiz, “and increased pro- duction on any very large scale un- likely, the outlook for the future has very encouraging aspects. Public Utility Prospects. Public utilities, according to Hen- Doherty, banker, share in a general business outlook for 1925 the complete without mention of the as- tonishing developments in _radio equipment. manufacture, and the ex- pansion of freight and passenger transportation by trucks and busses. When the year closed the¢re were ap- proximately 15,000,000 radio receiving sets in operation in this country. In three years the manufacture of radio equipment has become a lead- ing industry. Profits to dealers and manufacturers have been phenomenal, and there seems no check to the pop~ ularity of radio in sight. Makers of supplies are booked months in ad- vanoce. Truck transportation has grown by leaps and bounds. Railroads in many instances have replaced short-haul rall freight trafio by truck movement over distances up to 75 miles. Termi- nal congestion has been lessened and delivery speeded up. Store, door de- livery of freight seems destined to be put into effect in many centers within the next year. Bus Transportation Grows. Bus transportation of passengers in cities and rural districts has been placed on a more stable basis. Elec- tric roads have decided to make the bus an adjunct rather than a com- petitor, and themselves are running scores of bus lines in connection with their rail routes. In general the to- tal supplanting of street-car service by busses has been unsatisfactory, but the bus has taken its place firmly as a “de luxe” service. The automobile industry in general had a less profitable year than in 1923, but this was not due to approach of saturation. Rather it was the result of overoptimism and misjudgment of markets by manufacturers. After all, the year wound up with a production exceeding 3,600,000 cars and trucks, and both profits and prospects are of fair proportions. Steel Year Closed Well. The steel industry, which started the year llke a quarter horse With production around 92 per cent of ca- pacity, felt the business slump some- what keenly. The abandonment of the Pittsburgh plus system of basing prices caused a disorganization for a time, but benefited plants and con- sumers in the middle and far West. The adoption of the Dawes plan and industrial revival after elect ,u “vent far to counteract unfavorabe condi- tions, and the year could be regarded as anything but unsatisfactory. Building materials occupled a fa- vorable position. Window glass was in a satisfactory demand, but the plate-glass market was affected by heavy importations from abroad and the cut in automobile production. The coal industry was not prosper- ous except in the anthracite fleld, ow- ing to high wages and low demand. Oil bettered its position as compared with 1923. Gasoline consumption in- creased between 20 and 25 per cent, and the use of crude for fuel and in Diesel engines added greatly to reve- nue. The United States is producing 65 per cent of all the ol used in the world, and ofl men are confident of the future of the industry. Food Producers Prosper. Tea and coffee showed increases in consumption and in cost. The canned goods business was prosperous, with ‘higher prices-predicted L0 Dext Yealy country over which he regards as the most promising he has seen in 20 years. The public service industry, in his opinion, faces the new year with such advantages as the de- velopment of group in preference to local ownership; the improved call- bre and personnel of regulatory com- misslons; and the steady advance in nearly all branches of public utility practice. “Local ownership and ment,” Mr. Doherty sald, most _entirely superseded by . group ownership as represented by the modern holding company.” Such cen- tralized organization, he said, could maintain an extensive staff for the operatlon of properties which a local company could not afford. Its securi- ties found favor because they In- sured an investor against carrying all his eggs in one basket.” Predicts Big Auto Year. The automotive industry “should enter 1925 with the greatest confi- dence” in the belief of Alfred P. Sloan, jr., president of the General Motors Corporation. “Prosperity of the farmer and the wage earner,” he said, “add greatly to the prosperity of the industry. Conditions, both economic and psychological, are such that the purchasing power of both should equal or be greater than 1924. This insures a good volume of busi- ness, “As is generally known, 19 the largest year in our history year sales to consumers have been slightly less than last year. I see no reason why using the same measure, should not be equal to 1923." Progress was made by the industry in the direction of stability during the year just closing, according to Mr. “Sloan. “The tremendous in- creases in production which the in- dustry had enjoyed during its de- velopment stage are certainly not £oing to continue at anywhere near the same pace. The problem now is to eliminate all possible waste in manufacturing and distribution. I am confident a more satisfactory business, taken on the whole, will be developed on that foundation, with profits well maintained. The “silk industry, according to H. R. Mallinson, president of H. R Mallinson & Co., Inc., ends 1924 with mills running at capacity and in some instances in day and night shifts. The business accordingly is getting off to a flying start for 1925, with the possibilities for profitable progress in the year ahead as great as its his tory has ever recorded,” he sald. The position of silk itself as a basic in- dex, in his opinion, was measured in part by the fact that the United States consumed 75 to 80 per cent of the world output of raw silk, and also because it manufactured more silk textiles than all the other coun- tries of the world combined. manage- 'has been al- Flour advanced with wheat, rice was at record high levels, dried fruit s in extraordinary quantitics, the f production was absorbed early and profitably, producers of dairy products had a fair year in spite of heavy but- ter surpluses, fresh fruit growers ob- tained high prices, meats were strong, with falr export demand, and sugar prices were well stabilized. Beet sugar producers showed fine profits. Clothing production fell off, but toward the end of the year prices ad- vanced rather sharply. Cotton goods had one of the bad years of its hia- tory. Retail dry goods also suffered to a conslderable extent, and woolen manufacturers found their profits re- duced. ,Silk manufacturers did well. Shoes showed improvement, as did hides and leathers, and wool growers had no call to complain of their rate of return. Jewelry, musical instru- ments and other so-called luxuries registered fair sales. Hardware had a worse year than in 1923. Farm machinery did better. Paint makers had a most successful season, and the paper trade was in a firm position. Furniture sales were only fair as compared with 1923. Drugs and chemicals were helped by the demand for industrial alcohol and fertilizers. Non-ferrous metal mining took a spurt, and rubber worked to high levels before the year closed. Chain stores and mail-order houses established new high records in the early Winter months. Outlook for 1925 Good. Universal confidence seemingly exists over the outlook for the early months of 1925. The country is prosperous to an unusual degree, buying power s ex- traordinarily large, the European situ- ation is improving steadily, little un- employment exists, stocks of goods are low and consumption is high. This does not mean there is going to be a boom. There i{s every prospect, however, that improvement will be steady and continuous for the next four months. Even the farmers, who have ready money for the first ¥me in some years, have shown no sigas of an orgy of expenditure. Building will continue at a rate well up to that of 1924, since it will be augmented by farm repairs and replacements. The transportation systems of the country are In splendid physical con- dition.” Fewer mistakes are going to be made. Manufacturers are going to hold production well down to consumption Wages give no indication of falling ex- cept In textile industries. Best of all, there is mo market tendency toward inflation outside the stock market. There are few clouds on the horizon of business as the New Year com- mences and the most reliable business weather prophets predict ‘“fair and warmer” for some time to come. But there still is caution in evidence and a declded opposition on the part of the public to price Increases. Students of the economic situation have not for- gotten that every war In which this country participated was followed in six or seven years by a perfod of de- pression which In some instances reach- ed panic. In consequence these stu- dents, realizing that new conditions may arise which will change the pres- ent outlook, do not permit their pre- dictions of business advancement to extend beyond the middle of next year, (Ospyrizht, 1984.) Politics and Business More BY DAVID LAWRENCE. Politics and business have rarely been so Interwoven as in the year 1924. America, following the example of other countries in the throes of economic adjust- ment, found her electorate keenly sensitive to those currents in party politics w h ich promise a maxi- mum of stability and a minimum of disturbance. he first si x months of the year were devoted 1o the skirmishing by the various candidiates for the presidential nomi- nation. Calvin Coolidge had the advantage of being already in the White House, so his acts from day to day gave an indication of his char- acter of public service. The oppo- sition party, however, based its whole hope for victory on the promise that the Hardng administration had not made good. Striking revelations con- cerning .the leasing of oil lands in Wyoming and Califogrila promised at one time to mean the expulsion of the Republican party from power. The Democrats tried hard to associate President Coolidge with the errors of cabinet officers appointed by his predecessor, but to no avauil. Country Trusted Coolidge. The country simply would not be- lieve that a man of the rugged New Engjand training of Mr. Coolidge could permit a repetition of the oil scandal. Nevertheless, the ousting of Secretary Denby and Attorney Gen- eral Daugherty was demanded by the leaders of the Republican party who felt that the election could be better D. LAWRENCE. | the administration on_the defensive. Since that tim | noticeable effort were to continue there has been a on the part of the Coolidge group to dissociate the selves from all acts which occurr prior to the taking of oath |office by the Vice President. since the electfon, when the Amer people gave Mr. Coolidge an over- whelming majority. th has been confirmatory evidence that hie wished to steer the ship of state without thought of what had occurred before. “Botter Business and Prosperit The most impressive thing, about Calvin Cyolidg vember election, is his determination to make a record on his own behalf and not to regard the obligations or commitment of a predecessor in poli- tics too seriously. If there was any one thing, however, which typified the Republican candidacy it was the slogan of “Better Business and Pros- perity.” This did not appear last June—at the time of the convention—as the paramount issue. It then looked as if the Republican would fight a defensive campaign The Democrats were preparing to crusade for a liberalism and radical- ism which hoped to use the Teapot Dome controversy as the basis of its claim to power. Unrest in the agri- cultural regions of the country seem- ed sure to mean a political uphe There had been signs in the congressional elections of a sion in popular sentiment W spect to the Republican party even the Republicans themselves early in 1924 feared the tide would run against them. Turning Point of Year. The turning point in the year came with the events of June and July Not only did the Democratic party break in half at Madison Square Garden but the appearance of a third party, under the leadership of Senator La Follette of Wisconsin, made assurance doubly sure for the Republicans. On top of it all came the sudden ascent of the curve of | agricultural prices. It was due, of course, to no act of the Coolidge ad- ministration but to a series of cir- cumstances throughout the world which enabled the American producer to become the beneficiary of the change for the better. Politicians, however, do not look beneath the surface—they are satis- fied with the result and not its causes. A rise In agricultural prices, which at first was gradual, at last became a sensation until a ray of hope was spread everywhere that the depression of the preceding months would be superseded by an era of golden opportunity. Some sections of the country produced larger crops than ever before and the prices re- ceived were especlally favorable. The nrest in the agricultural States had cen due almost entirely to the di- minished return which the farmers had been receiving for their products. | The ecry naturally had gone up against excessive freight rates and the profits of the middiemen. The clamor for relief In a legisla- tive way had become so acute that the farmers of the West had begun to look to Washington for a solution of the problem, which had, in fact, only a general relationship to the Government at Washington. This was more or less borne out later in the year, when the upward trend of prices began to have its effect. Advantage to Party in Power. The party in power was not slow to take advantage of the change in the agricultural situation, and the con- servatives from one end of the West to the other insisted that it was no time to add disturbing factors to the situation by changing the adminis- tration. When it is said that the Government at Washington had little to do with the improvement in agri- cultural conditions, this must be qual- ifled by the statement that the exten™ slon of credit facilities by the Gov- ernment through the War Finance Corporation and private Institutions generally gave a psychological confl- dence which helped the West to re- cuperate when the good crops began to move. There was money enough to lend, and when the yield was found to be large and the shortages in other countries were discovered, the west- ern farmer began to think of paying off his debts. Estimates vary as to how much money was made by the American agriculturist on the crops for the year, but there can be no doubt that considerable payment was made on previous indebteduess. Agricultural Commission. There are, of course, some excep- tions to the rule. The cattle indus- try benefited only slightly and in re- cent weeks has become even more depressed. The President realized early in the year that the problems of agriculture could be settled only by a non-partisan study apart from the maelstrom of campaign politics. His first inclination was to appoint an agricultural commission in mid- summer and start working on a so- lution, but he was dissuaded from the course by the farm leaders themselves, who thought very little could be ac- complished because of the inevitable the of inde the sin fic | won with handicaps removed than if | administration | Closely Related Than Ever Confidence of Leaders of American Trade and Industry in President Cool- idge Emphasizes Near Relationship. charge that the commission was belng used for a political purpose. As soon as the campaign was over, however, Mr. Coolidge made £ood his promise and appointed au agricul- tural commission, which i< to meet in Washington on January 5, and one of its most immediate problems is the cattle industry. But while agriculture had much to do with the winning of the West by the Republican party, this cannot be said to have been true of the Eastern sections of the country. An alto- gether different basis prevailed there, but fundamentally it was made of the same issue, namely, confidence in the stability of the Coolidge admin- istration and its unwillingness to in- re with business by meddlesome slation or executive flat First Message Reassuring. Although President been in office only a short first message to s satisfled the business men of the country that | he was no radical and that he wou |undertake no experime p which would injure the course of business. His second annual message reinforced that view. It is strange on the pres | business toward govern | there is no longer so much clamor f | particular legislation with privilege In it, but a genuine that Congress with Coolidge had time, his Congre a con legis the pr ng and » fact that foreign trade ¥ | by law 1s an ir been pe feation ¢ world in n reg to do ome erican b plish | mergers in A | have been acco, murmur of | trusts,” d the Departn | ington has been free | to | masses by |a suck Federal T whict ington ness Commizsion Govern- | ment on unfa | competitio | fingers on e in a super that the by means of meth commission warding off s of an unfair cor back issfon, of cour by those w Government should thing to with ecor the survival of the fitte Washington, howev ’ refuge of the oppres er business be ated a large A Ju as agriculture Washing ton, so do business {men in the t Federal Commisston th v 1insti here wh » the for the s hir without lawsuits and expe | _There are oti | Washington whict bu | very vitally, par > Commer. olaints again latter nt months have d hed largel because the commission has been held within limits by the Transportat Act itself. The cc ne what are f. n in runs to the ¢ ssed ades is h can take u nderdog when nds ne In but the ir freight rates, after it has given due con- n to the other phases of » Which require that the roads be permitted to receive a certain re- turn on their investments. Radicals Will Not Res The radical group in Congress will not rest until they have in some way | modified the Transportation Act that freight rates can be changed and a flexibillty imposed in the Interstate Commerce Commission which it is not now enjoying. The effort to t all roads voluntarily to decrease freigh rates, which was a policy of Presi- dent Harding's, was not pursued by Mr. Coolidge because f futility. The program of c rail- ways so as to acl ve effi- clency is now held for ps the way out of the qif the roads reduce their operation by consolidation hope of the administra a cut in freight tained. Perhaps the most outstanding thing which Mr. Coolidge has done so far with respect to business his an- nouncement Yhat unless some unfor: seen emergency . arises he will not call an extra session fter next March. He is content to leave Con- gress to do its work in the present short session, passing the appropria- tion bils and going home for a legis- lative moratorium. Foreign Relations. dating greater expenses 1t is of the that rates ob- may be In the all-important field of foreign relations the year 1924 h; marked by the greatest advances since the close of the European war. For the pfoblem of reparations, which has constantly beclouded the vision of statesmen in all countries, at last was reduced to something besides argument and nationalism. It seems an odd coincidence that in the same year two men passed off life's stage —Woodrow Wilson and Senator Henry Cabot Lodge—the two chief figures in the five-year debate on the degree of international co-operation that should be given to Europe by the United States. President Coolidge, with counsel of the Secretary Charles BEvans Hughes, steer a middle cours who favored the League of Nations and those who advocated isolation. The American plan first presented a year ago in a speech at New Haven by Mr. Hughes, proposing that Amer- icans of expert training and knowl edge should sit with representative business men of other countries, was adopted and put into effect, being known as the Dawes-Young scheme. It has done more than anything else sin¢e the war to establish confidence in the good sense of the countries concerned and their sincers desire (Contniued on Page Z3.), . been E the able of State, decided to between those