Gloom

BUSINESS & FINANCE

U. S. businessmen have often had the jitters in the past two years of the New Deal. Sometimes they have been critical, sometimes impatient, frequently downright fearful. Often they have been angry. Last week they were just plain gloomy.*

Gloom has been gathering for a month or more--in market place and counting house, in home and club and office. And for once it was as thick over the rest of the land as in the dark depths of Wall Street. Even Washington seemed discouraged.

What was more, the gloom was worldwide. Heads of the European central banks gathered at a board meeting of the Bank for International Settlements at Basle, Switzerland, found fundamental conditions growing worse in every important economic area of the earth (see p. 20). After the meeting a New York Times correspondent wrote: "There is no feeling of despair and no fear of an immediate catastrophe anywhere, however. Pessimism comes from the continued lack of any indication of improvement in the basic factors . . . and discouragement from the fact that every one, despite all efforts made, feels he is forever fighting in retreat."

Of course, the sad-faced bankers were thinking chiefly in terms of international exchange -- particularly pound sterling, whose steep decline in the past few weeks threatens to bring on a crisis in the gold bloc lands and touch off a world race for currency depreciation.

In the U. S. the fall of the pound has helped intensify the gloom but no single cause can be spotted. Business has tapered off very little from the peak of the upswing that began last autumn, yet the stockmarket last week rounded out a long month's decline.

Perhaps the strongest underlying cause for the current U. S. gloom was summed up last week by President Henry I. Harriman of the U. S. Chamber of Commerce who is by no means unfriendly to the Administration. "Faith in the New Deal is waning," he declared. "During the past two years I have crossed the continent many times . . . visited many sections . . . talked with people in all walks of life. And as a reporter I can say that up to the fall elections of 1934 the President had fully maintained his remarkable popularity. . . .

"For the last four months, however, the story has been different. The people still admire the President and want to have faith in his policies. But they also want jobs. They see from seven to ten million men still out of work, and they see a sixth of the population dependent upon the dole for support. They are asking whether this should be so after two years of almost absolute power."

* Typographically erroneous, however, was the New York Herald Tribune headline last week which read:

MR. MORGAN AT L. I. HOME; HAS FLOWER SHOW GLOOMS

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