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Show "I'rofit less Prosperity"? Mr. Milton A. McKae, tor nearly a half-century one of the leading newspaper publishers of the country, has returned return-ed to his "retirement," at San Diego, after some weeks in the East, where he was engaged in merging several big business concerns and learning what is going on in inner business circles. What he reports is of unusual importance and interest, inter-est, one reason being that neither business nor political considerations con-siderations influence what he reports. Mr. McKae says: "In many trips east I have' never found business conditions con-ditions in the east and middle west as they seem to be today. I have talked wilh many bankers, manufacturers, and econo-i econo-i mists, and few of them agree as to existing conditions. An j eastern banker spoke of the situation in the east as 'the era , of profitless prosperity," meaning that while the manufac-1 manufac-1 turing industry shows only a slightly diminished output and I volume, fierce competition has reduced the profits to a mini- mum. Even the steel business, which has always been a bar- ometer of industry, shows a continuously diminishing out-I out-I put. "In Detroit, the automobile center of the world, there i have been more men out of work than at any time for the I past nine years. Beginning June 1, Henry Ford will lay off from 30,000 to 40,000 men for several weeks for the pur-: pur-: pose of revamping and revising his machinery to manufacture his new car. A tremendous interest exists among automobile men as to the kind and character of Henry Ford's new car. I, personally, know that Mr. Ford has designed during the past year three new types of automobile, each one complete, but he scrapped them all because they were not satisfactory to him. He now claims that he has developed the car that will satisfy the public. ' 'It is a well known fact that the volume of business on ! , the Pacific coast has been less affected than in any other part of this country. There is no doubt in my mind but that a business recession in the east began last October and will ! continue for a year or two. But any nation doing $90,000,-000,000 $90,000,-000,000 of business, as the United States did last year, can Dtand a slight recession without material injury. "I predict that, during tha next year, there will be more ( mergers in manufacturing industries than have taken place in any year in the United States during the last 20 years, and that a number of automobile manufacturers will be among those who will merge. Those in a position to know advise me that it is,the practical thing to do, because by reducing overhead and competition, it will be possiolc to evolve reasonable reason-able profits. TKir-fWipey market in tho east is very low indeed, and I predict the lowest interest rate that the country has enjoyed for some years past." |
