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Show For The New Years FOR THE Baby's Mother LUCKY BABY FIRST BORN IN BRIGHAM A FREE PAIR JITTERY KNITTERY 68 S. MAIN 1977 CITY IN or A 5.00 GIFT CERTIFICATE BABY SNEAKERS $5 an order of Worth of Dry Cleaning RANKER 146 So. Mdn COMPLIMENTS OF we Have To give Mom A Dad a brook Benson Tire Co. OF Father I 734-959- 5 FREKCN ' 723-85- 03 FRIES BILK SHAKE for Mom A Dad CLASSIC SHOES Frco Wheel 723- - S. MAIN Albeit odorn Clcanors - 36 North Main 408 S. Main For FIRST Mora FEDERAL $10.00 ivoora' op KascniPFions & Dd SAVINGS AND FOR THE NEW BADY LOAN at either Brigham City Store Gift Certificate for OF LOGAN CERTIFICATE DcyPcr ta) Has a 5.00 Savings Ceriificaia PeoeCii open selection Red Dcron Restaurant DRIVE-I- N US7S).Ca 306 North Main 723-39- FOR NUMBER I 23 " ( ' f S V t Babson forecast sees 1 977 outlook as 'promising' (Continued from Page 1) the economys historical rate of growth. Strength From the Private Sector A vital feature of the outlook for 1977 business is the likelihood that the bulk of the anticipated upthrust will stem from the private sector of the economy. Consumer expenditures for personal consumption should be in the forefront of . the rise in the GNP. Over much of 1976, - consumers have been reluctant to buy, but the staff of Babson s Reports looks for some loosening of purse strings in the year ahead. ' There should be good support from residential construction too, especially units have showed signs since multi-famil- y of a rebound in the latter days of 1976, whereas most of the comeback in home building had previously been borne by single-famil- y units. , Spending on services, long in a well defined uptrend, should continue to move higher. There will be increased government spending, but this will not bolster demand for goods substantially as much of the rise in, outlays must be allocated for wages, climbing prices for supplies, and debt service Inflation Will Remain Worrisome in 1976 some progress was made in the task of braking the inflation rate. Much credit must be accorded the food sector, which benefited from another bumper outturn of agricultural products. In the second half of 1976, however, took a prices of industrial commodities turn upward. Though the fever of inflation has been dramatically lowered from the heights of 1973 and 1974, it has not been completely beaten into submission. The tempo of inflation during 1977 is expected to average around six percent, of 1976. showing little change from thatunder-utilized While there is still considerable productive capacity to militate a sharp resurgence of inflation, a downward tendency in food prices will not be notable in the year ahead. Furthermore, increases in wages and operating expenses will be reflected in tempered only by the price mark-uplimiting factor of competition. Hence, in public psychology, inflation will undoubtedly cpntinue to be a dark threat. Such concern could become greatly aggravated if government spending and expansion of the money supply should be emphasized in an effort to solve the serious unemployment problem. s, Industrial Productisn During much of 1976, industrial output trended upward. But some hesitancy was seen in the late summer and early fall due in part to the auto strike and the decelera-- , tion in the economy. ' The pause in the recovery of industrial activity, however, should be supplanted by ' - renewed vitality during the first six months of 1977. The outcome of labor talks in the steel strike-hedg- e industry and the magnitude of inventory accumulation will, of course, determine the profile of the production curve in the second half of the year. long strike would hurt industrial output, but the absorption of steel inventories during the stoppage would result in a rebound after the strike. On the other hand, if a walkout were brief or entirely averted industrial production should be well maintained, although upward momentum would probably be checked until stockpiles were digested. For much of 1976, monthly comparisons of industrial production showed substantial margins of gain over 1975 simply because the early portion of 1975 saw industrial output in a sharp slump. While the remaining months enjoyed a rebound, production rates were still well 4 below the peak range. Year-ag- o 1977 in will reveal more comparisons limited gains, but the net result for the full year should be an increase of about four perceni over 1976. This will not match the expected climb in the real GNP because the production index does not include and make-wor- k services programs to reduce the jobless ranks will doubtless employment. emphasize service-typ- e Still, industrial production will move into new high ground, at least during the first half of the new year. Among the stronger lines should be autos and trucks, motor vehicle parts (both original and replacement items), aluminum, fabricated metal products, lumber and forest products, computer and peripheral equipment, home furnishings, and minerals extraction (assuming no protracted coal mine strike). A year-to-ye- ar 1973-197- Change in Inventory Policies? During parts of 1973 and 1974, businessmen unwisely stockpiled inventories in anticipation of higher prices and possible shortages, and at a time of already brisk demand. This demand sustained business at a peak level some six months or so, but when the inevitable correction arrived, virtual panic liquidation precipitated tlie painful recession of late 1974 and early 1975. Since then, inventory policies have been wary. Until recently there has been little incentive to do much in the way of forward buying. After all, consumer demand has been indecisive and spotty, prices have ruled on the weak side, and there has been more than enough productive capacity for most items. But some inventory accumulation is likely, much of this in steel and ferrous-base- d products as a hedge against a possible steel strike. Stronger consumer demand and the upturn in industrial commodity prices will also encourage forward buying, though we doubt that inventory accumulation will be carried to excess. More Support From Capital Spending Economic observers who have been skeptical of the lasting power of the current business recovery point to the lack of vibrancy in business investment for new plant and equipment. This is not an abnormal development, however, during the phase of an economic cyclical expansion. early-to-midd- le elect Carter in (he 197S presidential race, At such a time, the fact of ample there will probably be a strong appeal underutilized productive capacity forces from the White House for moderate, management to focus on the activation of noninflationary demands in contract talks. existing facilities. Not until the surplus But union negotiators will almost cerproductive capacity diminishes will budtainly press for all the traffic will bear in get allocations for new capital equipment direct wage increases and a wide variety become markedly more liberal. of fringe benefits, spurred by the inflation-erode- d While there are still differences of purchasing power of take-hom- e opinion as to how much surplus productive pay over much of the past three years and capacity actually exists in the economy, the rate of industrial output has certainly goaded anew by fears of additional inflareached a level where management thinktionary spasms in the years just ahead. At this tithe, however, reimposition of ing turns increasingly to the matter of controls does not seem hiking capacity and making overall operations more efficient. likely, though the threat of such action Hie fact is that 1976 has experienced might he subtly used to fashion peaceful and moderate union settlements. some pickup in orders for capital equipment, though on a spotty basis. During 1977 we expect business capital outlays to Building and Construction From a low point in early 1975 of a advance approximately 10 percent over the 1976 average. Much of this will be the seasonally adjusted annual rate of well below a million units, new private housing result of purchases of new equipment construction of starts commenced a recovery which conrather than large-scal- e new plants or additions. Environmental tinued during 1976. The climb was erratic and fell far short protection requirements will continue to of the feverish peak range in excess of two capture a significant share of business million units marking parts of capital expenditures. So, there is little likelihood that 1977 will see a capital 1 but the late summer and fall weeks of the spending boom of the type that nurtured ' past year experienced notable strength. With mortgage money adequate-to-am-pi- e the periods of economic upsurge in the 1950s and 1960s, even though Presidentand with mortgage interest rates far elect Carters game plan for revitalizing 'less prohibitive than they were in the the economy will likely incorporate some , credit crunch not too long ago. Babsons measures to stimulate business capital Reports forecasts another rise in new investment. housing starts for 1977, aided by the y housing perkier pace of inmulti-famil1976. construciton late Corporate Profits Business profits in 1976 scored a sizable However, with high building costs, burincrease over the year before. This redensome property taxes, and restrictive flected generally favorable raw materials conservation, environmental, and zoning costs, selected price increases, and high regulations acting as strong deterrents to levels of operations. large-scal- e speculative building, it is We anticipate another good increase in unlikely that 1977 can reach the marks for the year as a whole. A goal 1977, but the tempo of advance will , doubtless be considerably slower than that of 1.1 million starts seems more realistic of 1976. at this juncture, compared with about 1.5 On the strength of the projected further million for 1976. Industrial and commerclimb in business, a 10 percent gain in cial construction will make only modest business profits for 1977 over those for 1976 gains in the coming year. should be attained. This will appear pale .' compared with the estimated 25 percent , Employment Personal Income - Wages rise for 1976, but there will be plenty of ' 1977 prospects for employment and room for more liberal dividend disburspersonal income favor new record levels ements in the coming year now that for both of these vital economic sectors. corporate liquidity has been materially Employment in manufacturing and services should be augmented by a quickenimproved. It is more than likely, however, that the ing in the building field which has been lackluster over the past two years. biggest year-ag- o gains in corporate profits will occur in the first two quarters of 1977. The average factory work week should lengthen somewhat. Thus, with improveAnother Busy Labor Year ment in wage rates and salaries, the With the spotlight on the steel outlook for personal income in 1977 is for a industrys climb of some 12 percent. negotiations over new union contracts, 1977 promises to be another year of brisk Transfer payments and investment in1 , come should also provide some uplift. But activity on the labor front. Though not quite as numerous as in 1976, net after taxes will not rise commensur-- " major labor pacts expiring in 1977 will stili ately with gross personal income. Also, ; involve close to 3 million workers. unemployment will remain a sticky 7 In addition to steel, other sectors problem, around percent. facing contract talks include communications, aluminum, clothing, and facets of the construction field. Consumer and Government Spending Total consumer spending is expected to There could be trouble in the coal fields rule stronger in 1977 than was the case in again, with a repeat of the wildcat 1976. While this will be due in part to higher walkouts of 1976. And infighting for the unit volume of purchasing top prices, the be spots of several unions could produce some up by a comfortable should also unwanted work stoppages. margin. mnlnvmpnt and risinff in- Despite labors support for President- - come levels will make public confidence more positive. Consumers, however, are extremely sensitive to the threat of inflation, and rising prices could bring about spells of resistance. Public expenditures' at all levels of government will increase in 1977, a result of both inflation and a plethora of assistance and social programs. State and local governments will be forced to make some trade-off- s because of budget and debt squeezes, plus mounting demand by irate taxpayers for spending curbs. As for the federal government, higher spending is already assured by the present budget which will cover the first nine months of calendar 1977 and by still heavier defense allocations for fiscal 1978 which will be in effect over the final three months of 1977. Federal outlays may be lifted further if efforts to stimulate business and reduce unemployment should take a more ambitious tack than now seems likely. wage-price-prof- Farm Outlook American agricultural prowess was 1971-197- 3, 4 again displayed in 1976 by the third-becrop year on record. This was surpassed only in 1975s peak and the second-beeffort racked up in 1973. Going into 1977, there will be good carryovers of most farm commodities. This would seem to imply planting curtailments and-o- r changes in the crop mix of plantings in the coming year, but the steadily worsening world food gap suggests government pressure and incentives effort in food production. to sustain all-oThis may well take the shape of some plan for a food bank. s st st f ' -- ' t.aaaJ . Washington Foreign Affairs The new administration will have a favorable initial rapport with Congress, but how long the honeymoon lasts remains to be seen. Differences in the degrees of liberalism between President-elec- t Carter and members of Congress as well as divergences among Congressmen themselves indicate that the platform of the Democratic party cannot be taken as fait accompli. Initially, efforts will be made to spur consumer spending --r probably through a and to create jobs. Since 350 tax rebate most other objectives will take time, national health insurance, reorganization of the government, and a national energy policy may be less political rhetoric the economy in such a way as to upset consumers and investors. poor-mouthi- Unless something unexpected forces international affairs into top spot, domestic matters will hold the spotlight at the White House for a while. comments, Regardless of foreign policy under Carter may differ little from Fords approach, expect for the Mid-easituation and the "fly at any time" tactic of recent years. Though Carter is ostensibly more jean lous of US interests in Sino- - and relations, the spirit of detente will not be written off. Granted, with the ongoing ferment in the worlds trouble spots 1977 will undoubtedly have its share pre-electi- st Soviet-America- of but Babsons predicts there will be no World War III outbreak in the year ahead. Money Supplies Interest Rates Easy money forces on Capitol Hill and ia the Carter camp seek even more liberal expansion of money supplies. While the Fed is leery of inflation danger, we feel that there will be enough money and credit for legitimate business needs. Yet, unlike 1976, stronger demand for funds will mean at least some stiffening in money rates. Look for the prime rate to reach 8 percent by the end of 1977. Long-terrates will tend to firm also, but not to any great degree. m ' Stock and Bond Outlook Babsons Reports looks with optimism on stock and bond prospects for 1977. Good stocks are available well below historical peaks, and the odds favor a spate of dividend increases. The basic uptrend of the Dow Jones Industrial Average should resume, and new high ground be reached. A reasonable range for The DJIA appears to be 1,200 on the high side and 850 on the low side for the year. While bond prices have rallied in 1976 and interest rates may rule moderately higher in 1977s latter half, the income-oriente- d investor can tie down some good yields in quality bonds, especially at this time. For growth and appreciation portfolios, Babsons currently favors better quality commons and convertibles in such fields as computers, electronics, insurance, drug and hospital supplies, savings & loans, fuel and energy, trucks, and building supplies. Animal control i (C .I'tinued from Page 1) county should assume animal control responsibilities. At the present time, Brigham City has a shelter and two animal control officers. However, neighboring communities, such as Mantua, Willard, Perry, and Corinne, have no shelter and disposal of strays to an extent has been performed for them by Brigham City. While Brigham City officials have expressed a willingness to let Box Elder county take over operation local pound, Commissioner Nielsen said he would rather see the county simply funds into animal control and let put the communities handle it. In still other busineM,. the commission approved renewal of ibeiir license for the Heil service station' WWuth Willard of-th- e |