White-Walls

One of the first civilian products to disappear after Korea was the white-wall tire, that symbol of what economists*call "conspicuous consumption." Last week NPA told rubbermen they could make whitewalls again, a sign that conspicuous civilian production was almost back.

Automakers were told that they will have materials enough in the third quarter to make 1,050,000 units--5% more than in the second quarter--and will be allowed to make at least 1,150,000 cars if they can stretch their metals that far. Actually, the problem for most civilian industries was not how much they could make, but how much they could sell.

To spur lagging sales, there was a new wave of price cuts. Sears, Roebuck and Montgomery Ward brought out their mid-spring catalogues with prices slashed up to 37% on hundreds of items. TV makers, whose sets have been selling for months at big under-the-counter discounts, recognized the fact by officially cutting prices by $10 to $90. Food prices continued to slip and farm prices as a whole were 8% below year-ago levels.

Even with the price cuts, retail sales were still sluggish. But there were signs of a pickup. And the Federal Reserve Board reported that the index of industrial production, which had been holding steady for months, edged up in February.

*Notably Thorstein Veblen who, in 1899, wrote: "Conspicuous consumption of valuable goods is a means of reputability to the gentleman of leisure."

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