Sidewise

The Wall Street Journal this week headlined: BUSINESS IN 15-WEEK SIDEWISE MOVE; BREAK EXPECTED TO BE ON 'UP' SIDE. Evidence to support this conclusion abounded. Such sensitive indexes as scrap steel and commodity prices were up. Steel production at 55.1% of capacity was near the year's peak. Automobile output rose, National Distillers Products Corp. filed the first large industrial bond issue ($22,500,000) since November. And the Dow-Jones industrial stock averages climbed to 149.49, a gain of 13 points from the year's low on January 26.

Most production indexes showed a steady rise from June to November when the " 15-week sidewise move" began. A corresponding rise in TIME'S index of Business Conditions (see below) took place from March to August, when the TiMEline wavered, subsequently to reach a new peak on the first of the year, and then begin another descent (which has not yet indicated a reversal of the major uptrend). This in no way contradicts the sidewise movement of other indexes, for the TIME index reports not production but the relative soundness of business conditions. Since business activity has lagged several months behind the TIMEline, business activity in the immediate future may well reflect last December's rally in the TIMEline --as the stockmarket last week gave some indication of doing.

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