Moth Hole?

Manhattan kids last week had their first chance to go coasting since Thanksgiving. In its puckish fashion the stock-market also went tobogganing. Somewhat to the confusion of Wall Street, which was generally bullish, prices continued a slide that began with the new year. The Dow-Jones industrial stock average got down to 146.52, barely above the November low of 146.14.

Yet no important commentator last week could find in the fabric of U. S. industry any moth hole big enough to justify a major stock slump. Signs for optimists included:

> Steel output climbed a point to 52.7% of capacity.

> Engineering construction awards hit the highest level since 1930.

> The National Machine Tool Builders' Association announced that its index was up 34 points in December over November.

> The Federal Reserve Board reported December industrial production at 104% of the 1923-25 average, up from 77 six months ago.

> Bank debits rose comfortably.

Aside from war, the most obvious threat to continued industrial recovery seemed to lie in the possibility of overproduction such as brought on Depression II. Rising commodity prices would probably herald such an event and last week they were only slightly above the four-year low set last month.

Nonetheless, some thought they saw signs of overproduction in the nation's No. 1 industry when General Motors Corp. announced that it had sold 83,000 more cars to its dealers in the final quarter of 1938 than they had sold to customers. This was almost the same surplus as marked the final quarter of 1937. But there is a difference: Year ago dealer inventories were at a peak of 425,000 new, 800,000 used cars; last week, according to Detroit estimates, they were relatively normal--300,000 new cars, 450,000 used.

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