“HOT MONEY” IN U.S.

Gisborne Herald, Volume LXXII, Issue 21853, 25 October 1945, Page 5

“HOT MONEY” IN U.S.

INFLATION RISK PRICE CONTROLS VITAL HOMES AND MATERIALS (10 a.m.) WASHINGTON, Oct. 24. The head of the Office of Price Administration, Mr. Chester Bowles, toid the Senate Banking Committee that plenty of “hot money” is floating around the United States. The situation called for continued price controls which should be expanded to include housing. lie said that ready cash in savings and cheque accounts alone equalled more than the entire amount spent by consumers in 1939; much of this will be spent in bidding for the first new supplies of things that were scarce during the war. “Talk of inflation fills the air today,” he said. “The stock market booms merrily upwards. Taxi-drivers and barbers, as in 1929, pass out tips on favourite speculations. There is more ‘hot money’ around than most of us ever dreamed possible. “We are particularly alarmed at the dangerous situation in housing and building materials. At least 3,000,000 families are expecting .to build new homes, but building supplies remain extremely light. I am fearful that unless prompt and vigorous action is taken, we will soon be facing a wild scramble for scarce building materials, accompanied by rapidly increasing prices for old and new homes. “The average real estate prices throughout the country are already up 50 per cent, with an increase of more than 100 per cent in many areas. I want to make emphatically clear that the need for price control and rent control will not be ended by June.