Show BABSON'S CASH REGISTERS TO JINGLE THIS SUMMER Babson Park Mass Now that Easter is over the taxpayers ers have or ought to have paid up what they owed Uncle Sam on last years year's earnings one of the big questions is How freely will consumers spend this summer Current Economic Status Upon the ultimate answer to that question quite a good deal hangs We are now In the eighth year of a cyclical expansion which has chalked up a billion increase in Gross Nation Nation- National al Product But the business community's confidence In the outlook Is dampened by a siz siz- siz sizable able number of uncertainties political l military and econ While industrial production just hasn't made the long strides earlier forecast by some observers with a strong boost from inflation GNP has roared ahead at record near speed However uncertainties especially concerning possible ble government tax moves and the Imposition of wage and price controls have added a note of caution Personal Income Yet very much on the plus side In any assessment of the situation is the extremely high level of employment which pro pro- promises to be well maintained over the near term at least Un Un- Unemployment employment is being held to 4 per cent of the total labor force 1 about as close to minimum as we can expect Perhaps the biggest plus of all is personal income Already at a record high it continues s 's to move smartly upward The in in- in increases creases being registered reflect gains in several parts of the economy Including advances in wages and salaries in business and professional Income in rental returns as well as in dividend and Interest payments ts Living Costs Savings Purchasing Power How much money people have available for discretionary purchasing depends in large measure on what it costs them to obtain the necessaries of life food clothing and shel shel- shelter tel ter Living costs go on climbing relentlessly At the end of Feb latest month for which complete figures are available consumer prices were 37 per percent percent cent above a year earlier at ata ata a record per cent of the 59 1957 average But how much money Is avail avail- available able for spending depends also on the amounts stashed away in peoples people's socks And since the middle of last year savings have risen sharply climbing to very high levels This increase in total savings and in the share of income allocated to savings is the consumers consumer's answer to ris ris- ris rising ing prices and higher Interest rates Boosts in total personal In come and In Income after tax tax- taxes es have for some time been outpacing increases In living costs As s a result a majority of the nations nation's consumers are In a favorable buying position even though many people have not shared fully in the broad Income gains achieved national l ly Consumer Attitudes People use lIse their purchasing power In two ways Either they buy goods and services or 01 they buy financial assets savings Their choice is limited by their income and or their ability to obtain credit as well as by the cost cast of that credit Purchasing decisions are governed also by bya bya a balancing of the benefits and the costs of what is to be bought How will consumers react this summer Since uncertainty be gets caution and restraint our guess is that by the large con sinners sumers will continue to buy more freel freely than last year But spending decisions will be fur ther Influenced by price and tax developments other gov gov- gov government moves here and abroad our commitment in Vietnam and by business and employment conditions prevail prevail- prevailing Ing in local areas While pro pro- profligate spending may be avoided consumer purchases of goods and services will show i further advances this summer It should be the bi biggest gest yet for apparel especially sports sports- sportswear sportswear wear sporting and camping goods and resort ions will get the big play |