Show 21 OUTLOOK IS S 0 U r D fOR BUSI BUSINESS SS Should Find Strong Public Buy Buy- 4 u n a 8 summary ot oL the ears yeara Yr siness emphasis must be placed place of all On Oi the exceptional de- de of rity enjoyed by ily IY every major economic group 4 the tho country states current sue mie ot of the Guaranty Survey h has just been issued by the anty Trust company of New rk bik The most strikIng feature this prosperity Is that It Is more than prosperity rity the conventional economic sense active business large employ employ- ent rising prices and wages and cr asing bank loans the Sury Sur y continues Under such con con- large business busine Jg profits alost al- al ost st st. invariably In prevail but wages d do salaries while generally g often faIl to keep ce the advance In the cost living so FO that the purchasing of some lags lats behind at of others It Is chiefly In this ct that the present domestic IP- IP u Is remarkable Not only ye e wages risen to new v high vets but the cost of lIving has hns crOL creased Jed comparatively lIttle In last five years and during the eater part ot of this year It has hast t been moving downward 1927 OUTLOOK The wide distribution even r re than th volume of the pub pub- power po-er justifies the that business will coniTo con con- iTo Q active and underlyIng con con- l l-l ns generally sound during the year It Is not to be ex- ex that the rate of growth during the las two rs s can be tely Even it if it be granted that r Is a normal feature of the business and that the power now exi exiting lUng could lder ider better manag-ement manag produce sU more than It has even In 0 recent past It remains true rapid expansion demands which must from time Ime occasion temporary set set- s It must be remembered wever that a moderate decline dec mJ such suh levels level as have existed J year would by no means rk the end of tire the present era ern CESSION POSSIBLE Ie number of developments In Ine e last few months have led to toL tot L r ther general genera belief that some Bome someI t I c i sIon or at lea least It some slow I down In the ra rate te of expansion I likely to OCCur In the near fue fu- fu I e Curtailment has In fact al- al y In some ome dIrections I II declInes in building actiVity Ea d a manufacture the lIed lle-d key IndustrIes IndustrIes' the theS S I ward vard movement of Commod m Ill prices the effects J of low cot cot- prices and of unfavorable cons con con- s In some agricultural seans sea sea- n ns the extremely high level of prIces and and ot of speculative acin lC- lC In the security markets the euort trade balance I 1 Ical uncertainties the outward i ement of foreign C which 1 l taken refuge in this country rIn ring the period of Inflation In- In ng competition at home and these road are among the tao tao- J. J sc that bavo been mentioned fis s the approach of busi- busi cs 55 rea cUon n n the other hand there is the l Ic fact of large and widely ly sred purchasing Power J full employment high hIg-h wage Is active retail trade and small n a edit It sItuation a highly liquid On th the part of most enterprises slowly re- re ipg pu power abroad Ui th the hone hODe of more rapid 81 s to follow the restoration of nd ad fInancial conditions re- re ly y efficient transportation ce and factors such the expenditure In this country funds borrowed by foreign in- in As for the Influence of commodity prices the of th the past year has hasiy iy ply demonstrated that such a av v ment d- d does J not necessarily arlly duce excessive hesItancy On tIre the of business men while e It ai- ai ax ar that in some respects the enee of the tendency ual in periods ot of prosperity may to prolong rather than Il the present term of pros pros- 1 t tl iVE PRODUCTION l The year as a whole has a new nev peak peale In general in- in Ired rial production while the volle vol- vol Ti le of trade at wholesale and re- re that tIre industrial f P has moved freely Into lion con f without resulting resulting- in any Inventory 1 Th- Th tion The level of activity has been fairly stable throughout the year The position of the banks has continued very strong throughout the year With money rates moderate moderate ate and fairly stable TIre The condition condition condi- condi tion of the Federal Res banks shows fe v fe important changes durIng during dur- dur ing the last twelve months Discounts Dis Dis' counts are slIghtly smaller than a year ago but this declIne is more than offset by increases in the amount of open market purchases and In holdings of government se- se Note circulation and deposits deposits de- de posits have increased very moderately while reserves show a more pronounced gain tire the present total being about above that of ef a year ago The most important change In Inthe inthe the condition of reporting member banks of the Reserve system tern tem is the continued increase in inthe inthe the amount of tibe deposits which is now greater by than thana a year ago Loans Leans and discounts have increased by notwithstanding slight declines in loans loais against security collateral Investments have also Increased while net dem demand nd deposits have declined by and bor- bor rO from the Federal Reserve banks ban by Tho position of the stock market market mar mar- ket Is probably stronger than a year ago prices have regained and possibly even surpassed sur- sur passed the level then prevailing there are numerous evidences that the general public is less deeply In security speculation than was the case last winter At Atall Atall all events the amount of bank funds devoted to tIre financing of stock transactions shows an apprecIable appreciable ap- ap net declIne during the year COMMODITY PRICES The movement of commodity prices is the anomalous feature of the years year's business developments Despite the undoubted ted prosperity of the country and the high level of business activity prices In general gen gen- eral have declined but rather throughout the year It Is noteworthy that most of the principal groups show the same general movement As a factor bearing on the probable future trend of busIness the slow downward movement ot of prices appears to strengthen outlook for continuation tion of pros pros- pertly In some directIons no doubt confidence will be Impaired and enterprise restrIcted by the gradual declIne Such a slow ro- ro cession however threatens little in inthe inthe the way of inventory losses particularly par par- at a time when busIness concerns in general are carryIng on a very large volume of business with the of investment nt In stocks of goods Tire The absence of price appreciation certaInly reduces re- re duces the incentive to speculative buying a practice which could easIly result in disaster ter under present conditions with the country's country's coun- coun try's gold res reserve at an abnormally abnormal abnormal- ly high figure and subject to enforced enforced en- en forced reduction at any time |