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Show This Recession Is Difficult To Shake While economists both inside in-side and outside of government govern-ment have been hoping for an early end to the recession for some months, business in general gen-eral is finding it slow indeed for a real recovery to make itself felt. TRUE, THERE have been signals of improvement here and there within the economy, but for the most part they have proved to be temporary. Even post-vacation days of September Septem-ber have promised more than they have actually achieved in terms of recovery, and most of the final statistics for August were disheartening. For instance, the Federal Reserve Board's index of industrial in-dustrial production declined a seasonally adjusted 0.5 percent per-cent in August. A number of economic observers felt that this decrease-the 11th since the recession began in July 1981-indicated that unemployment unem-ployment will continue to hold on a high elevation over the months ahead. The dip in production pro-duction for the last full month of summer was particularly disconcerting in view of the fact that July showed an advance adv-ance in the index, even though it amounted to only 0.1 percent. per-cent. IT WAS expected in many quarters that the U,S. economy eco-nomy would pick up as an aftermath of the paring of 10 percent in personal income-tax income-tax rates effective the first of July. It has become clear, however, that too many people decided to keep their extra money rather than spend it on consumer items such as autos and more expensive merchandise. merchan-dise. Until consumer duying becomes notably stronger, best opinion has it that production produc-tion will bs held down to prevent pre-vent inventories from becoming becom-ing top-heavy. This is another specific reason for many economists eco-nomists to look for a further high level of joblessness in the months ahead. During the first 10 days of September, domestic auto sales plummeted 29 percent, to the concern of the entire retail front. It was, for example, sad proof that the automakers' incentive in-centive programs to cut down excessive car inventories have been far from successful. Ahough General Motors gave dealer bonuses ranging from $500 to $2500 for each auto sold in a particularly aggressive aggres-sive promotion, they reported that new-car sales totals for the first 10 days of September fell off 30 percent. This failure has prompted automotive officials to consider the possibility of "sweetening the kitty" in upcoming up-coming plans. INVENTORIES in all industries indus-tries are problematic. Retailers Retail-ers have pointed out that business busi-ness inventories for the full month of July edged up a trifle at a time when sales were relatively rela-tively feeble. Many fear that overall industrial output will be held down to relatively low levels for some time to come. A great many of ths nation's keenest economic experts feel that in order to get out of the recession and move ahead with any degree of vigor retail trade must pick up smartly along a broad front. This, however, has not yet showed signs of happening. U.S. retail sales turnover for August dropped 0.9 percent, according accord-ing to the Department of Commerce. Com-merce. Even though some business forecasters thought sales for August would be far from spectacular, many did not expect such weakness as was demonstrated. Much of it was due to the poor showing in the auto field. Without that decline, de-cline, the Department said August Au-gust sales would have reflected a 0.1 percent gain. DESPITE these uneasy factors, fac-tors, a number of economists feel that the recession is actually bottoming out. What with the 10 percent tax-rate reduction, re-duction, less exaggerated interest in-terest rates, and continued progress against inflation, they would not be surprised to see consumers gradually increase their spending, thus helping to spur at least a moderate begin-- begin-- ning of recovery. Even the best guessers, however, are not sure when real progress will be seen all along the way. |