Up & Up

The bull market kicked up its heels last week, and reached a new high. In 1951's first week of trading, volume topped 3,000,000 shares for four straight days, one of the biggest weeks since the baby bull was born in 1948. With such old reliables as steels and motors leading the way, the Dow-Jones industrial average leaped 4.51 points in a single day, hit 240.68 at week's end, more than five points above the previous peak in November. Much of the surging demand for stocks came from pension funds, investment trusts and other big investors. But even little investors felt that with more inflation ahead, it was better to have their assets in stocks, which were going up, than in dollars, which were depreciating.

Outside the market, the news was not all bullish. In November, reported the Federal Reserve Board, credit controls had caused installment credit to drop $74 million to $13.3 billion, the first drop in that pre-Christmas month since 1943. Nevertheless, overall credit (e.g., loans, charge accounts) kept on rising, reached a new high of $19.4 billion.

As materials shortages hit harder, new layoffs swept through industry. Most of the big refrigerator makers cut back production (up to 15%), and Avco Manufacturing Corp.'s Crosley Division (radio, TV and refrigerators) laid off 1,000 employees. Chrysler Corp. made the biggest cutback of any company to date. It announced that it was laying off 25,000 men and slicing January production by 20%.

Though most of the other automakers had already made some cutbacks and planned some more, they were still optimistic about production in the first half. Despite the layoffs, said Ward's Automotive Reports, output should be no more than 5% below last year's first-half production of 3,100,000, when Chrysler's plants were closed by a strike. Said General Motors Corp.'s President Charles E. Wilson: Defense orders so far placed "will not absorb 5% of the manpower in the [auto] industry during the next six months, nor as much as 2% on the average of the materials used by the industry."

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