"IN THE DUMPS"

King Country Chronicle, Volume XXV, Issue 3373, 3 October 1931, Page 5

"IN THE DUMPS"

BUSINESS SITUATION IN UNITED STATES. CAUSES OF SLUMP. A sidelight on conditions in the United States is given by an American business man in a letter to a Wellington retailer. "In spite of the moratorium," he writes, "business in general here remains in the dumps. Money is very tight. One great trouble is that so many people hold on to their money, the result, of course, being that the savings bank deposits are greater than ever. Self-preservation is the first law of nature, and no doubt accounts for heavy per capita savings. Another thing here, and probably not felt so much here as in other parts of the world, is the insane desire of everyone to own- a motorcar. This means a heavy drain, to be sure, and as a result the owner and his family go without many necessities, thereby causing those dealing in necessities to feel the lack of real buying power. Instalment Buying Curse. "Instalment buying is another curse. It is so easy to get credit, and everyone must have his radio, electric refrigerator, electric this and that that the majority of the American workers are up to their neck in debt, caused mostly by their desire to keep . up with the family next door.

"It would seem that my first statement about there being so much money in the savings banks is inconsistent with what I have just said. When I say that many people hold on to their money in the savings banks I mean that they are of the class who could well afford to put it into circulation to help us 'out of the depression, but they, too, have gone into the depressed state of mind, and are usually cautious. "It has been recently estimated that 7,000,000 people are out of woi'k in this country, and no apparent relief is in sight. Only recently President Hoover has tackled the unemployment problem in view of the forthcoming winter, which probably will be even worse than the last one —that is, from the standpoint of human suffering—and that one was certainly bad enough:

High Tariff Effects.

"Another thing, and to my way of thinking, a most vital matter, is the tariff situation. The (foreign) tariff walls are getting higher and higher, and American exports are greatly 'off.' Let us take a specific example, American typewriters, which are generally conceded to be the best-built and lowest-priced in the world. The two leading typewriter manufacturing firms have registered a distinct growth domestically, but their export business has fallen terribly; to such an extent that instead of working full time, their factories are running only three or four days a week. There you have a typical example of what American industry is up against, and what can be done to readjust such a state of affairs is beyond me. Let's hope for the best, not only in the United States, but elsewhere in the world."