Above the Line

''The United States Government has . . . taken a step backward into the darkness of the Middle Ages," snapped crusty old Editor Jacob Seibert last week in his Commercial & Financial Chronicle, referring to the decision to pay Government gold bond interest in paper dollars. But U. S. Business took a big step forward. Chart-watchers throughout the land happily eyed certain thick black indexes creeping slowly above the line of May 1932. For the first time in four long years of Depression, they said, U. S. Business was definitely better than it had been twelve months before. Automobile production for the third successive week exceeded last year's figures, and May was expected to be the best month in nearly two years. Steel output crossed the line at 33% of capacity, was expected to soar to 40% this week. Carloadings, biggest barometer of the movement of goods from mine to mill, from factory to store, jumped 43,000 to 535,000. considerably more than the usual seasonal gain.* Only major index still below the line was electric power production, but a heavy gain was predicted for this week. The gains were not all in the basic industries. Retailers described their trade as the best since Christmas. Exporters, jumping to the chance that a depreciated dollar provided, reported the best business in two years in automobiles, machinery, radios, tools. Sales of cotton goods were well in excess of production, something seldom true of that unhappy industry. Wholesale trade was reported above normal. From London came reports that the travel business of Thos. Cook & Son-Wagons-Lits Co. was 10% above last year. For the time being, observers last week agreed there was little doubt that U. S. Business could hold the thin black line of last year's level.

*Most indexes are adjusted to season variations. Typical is power production which must be adjusted to iron out the rise in winter (when days are short), the decline in summer. Annual peak is usually a cloudy day in the week of Dec. 22. shortest day of the year. Bottom is not around June 21, longest day. but always July 4. most observed U. S. holiday.

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