Gypsum & Deflation

A white, nonmetallic mineral is gypsum. It has been used as a building material throughout history. In raw form its principal use is as a retarder in cement, preventing it from setting too rapidly. It is also in wide industrial demand as a flux in smelting, as ''mineral white" or "terra alba'' in the paper, textile and paint trades. Blackboard chalk is raw, powdered gypsum molded with a binding substance. Pure gypsum is alabaster.

Most gypsum, however, is calcined by dehydrating with heat. With 75% of its moisture removed, gypsum becomes plaster of Paris.* And mixed with sand, hair, wood fibre, lime or other materials, calcined gypsum is just plain plaster.

About one-half of all U. S. gypsum plaster is sold by U. S. Gypsum Co., a $60,000,000 corporation founded in the trust-making heyday of 1901, and always called by its management "Gyp." Gyp also sells prefabricated plaster called Sheetrock. Gyp's leading non-gypsum item is metal lathing to put under its gypsum plaster, and Gyp sells about one-fourth of all metal lathing in the U. S. Hard hit by the building depression, Gyp's profits sank as low as $1.599,000 in 1932, were $2,155,000 last year.

Head of Gyp for three decades has been a suave, nimble-witted gentleman who today is more famed as the president-chairman of another and noncompetitive corporation. Montgomery Ward & Co. Gyp's Sewell Lee Avery was picked to pull the floundering mail-order house from its red depths. He did. Last year Ward earned $9,302,000 (11 mo.) as against a deficit of $8,712,000 in 1931. But Mr. Avery continues as Gyp's president, a fact which lets him in for unmerciful attacks from disaffected Ward stockholders. Once they cartooned Montgomery Ward as a cow. U. S. Gypsum as a pail and Mr. Avery, as he said at a boisterous Ward stockholders' meeting last year, "in the flattering position of doing something about which I know nothing."

Last week it was as Gyp's president that Sewell Lee Avery presided over a stockholders' meeting. Forthright as ever, he briskly challenged a few of the country's most cherished economic notions. It was shortsighted, said he, to think that the U. S. must embark upon a vast building program to restore prosperity. There was far too much building in the last period of prosperity. Home and industrial construction would pick up when & if business activity created a genuine demand for new quarters. What was more, any building revival was unlikely until both material prices and wages came down. And Mr. Avery went on record with a prediction that there would be a period of deflation before inflation finally set in. That prospect, he declared, now has businessmen "not only puzzled but actually worried."

*So named because of the gypsum deposits in the vicinity of the Montmartre section of Paris.

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