Altitude: Rising

From Washington last week came a new set of statistics measuring the U.S. economic altitude as of second quarter 1958. The figures added significant evidence that the altitude is rising.

The Commerce Department reported that the value of the rate of output of goods and services in the first three months of this year (seasonally adjusted) was $425.8 billion, $4 billion higher than earlier calculations. This was down sharply from a peak of $445.6 billion in the third quarter of 1957; all told, the recession has chopped $20 billion from the gross national product, about 4.5% v. 2.7% during the 1953-54 recession. It is not likely to cut any more. Though second quarter figures are still incomplete, top Washington economists expect them to show a $1 billion rise to around $427 billion.

The Federal Reserve reached the same conclusion with a different set of soundings. At 130 on the 1947-49 index, June industrial production was two points above the May level--and four points higher than April. Output was up in all major categories with increases ranging from four points in both industrial goods (machine tools, aircrafts, etc.) and consumer durables. Even more meaningful was the news on personal income. Though total personal income has held remarkably stable throughout the recession, serving as a needed ballast for the whole economy, April's rate for wage and salary disbursements had still dipped to a worrisome low of $232 billion, down $6.1 billion from 1957. In June the figure climbed back up. The total: up $3.3 billion to $235.3 billion. If Social Security and veterans' payments, which hit new records this spring, are counted in, total personal income for June, at $351.8 billion, was appreciably ahead of 1957's level of $347.9 billion.

Economists noted two major industries where the quickening business tempo was coming clear. In construction, private housing starts continued to rise in June to a rate of 1,090,000, highest since the boomtime year of 1956. There was even a small but bright spot of light in the auto industry. Although July stocks of unsold cars and trucks amounted to 695,000 units, it was the smallest inventory for this time of year since July 1954. To help work off the rest of the load, Detroit carefully held back from rushing in to replenish dealer stocks, allowed shortages to develop in some lines of convertibles and station wagons. Looking ahead, the industry anticipated that July, August, September and October would pare inventories to new lows and clear the showrooms for new models.

This file is automatically generated by a robot program, so reader's discretion is required.