Economy Booming...

Press, Volume CIV, Issue 30641, 6 January 1965, Page 9

Economy Booming...

(N.Z.P.A.-Reuter—Copyright) NEW YORK, Jan. 5. The United States is enjoying a record-breaking economic boom which shows little sign of ending. When Americans went to the polls on November 3, their country was in its fortysixth consecutive month of business expansion, a peacetime record. The newspapers were full of company reports of record profits, sales peaks and “new highs.” Few, if any, inflationary pressures have appeared and unusual price stability has prevailed. Most business analysts expect the boom to continue next year. Some predict that it will slacken but no-one is suggesting that a typical trade-cycle slump is round the corner. As business improves, prices have shown surprisingly little change. The wholesale price index is essentially the same as it was six years ago and the index for consumers has only risen from a 1957-59 base of 100 to 108.4 this autumn. The foreign trade balance is expected to reach a healthy 6700 m dollars this year but the balance of payments deficit, for years a serious prob-

lem, may remain at about 2000 m dollars.

The huge American corporations showed large profits in the first nine months of 1964 and many are expected to report record annual earnings. General Motors had the largest profits and sales ever recorded by a United States corporation in the first nine months of any year—l36om dollars (about £500,000,000).

Many other companies reported substantial increases in third quarter earnings after taxes. Most steel manufacturers had record profits and machine tool producers predicted that their output this year would be far above 1963 figures. All these boom conditions will be carried over into 1965. according to most business analysts.