Current Situation

With the Christmas shopping season at hand, other business phenomena for the time being are of secondary interest and importance. Indications are for a very good retail trade, although in some quarters it is apparent that merchants have not stocked their shelves heavily. The Manhattan stock market, last week, encountered its first important reaction, so long expected. The slump in prices proved only temporary, however, particularly in the good rails, and failed to indicate any real halt to the rising market.

It is to industrial conditions, therefore, rather than to stock prices, that business is looking for guidance; and the outlook is more than usually confused. In most lines, the trend is undoubtedly toward improvement, particularly in the very barometric steel industry. Nevertheless, the lesson of the first quarters of 1923 and 1924 are still fresh in mind. In both cases, prices rose with increased demand and prospects grew rosy. Manufacturers, however, opened up and speedily unloaded goods on the market in such quantity that prices fell again and production languished.

In most industries, our productive facilities still outrun our normal demand, We have apparently entered a cycle of small industrial profits and intense industrial competition. Manufacturers are now wondering whether the first three months of 1925 null witness a repetition of the preceding two years or whether a more moderate industrial program will prevent overproduction next spring.