Blue Skies?

How big is the boom? Bigger than ever, said the Federal Reserve Board last week. Following the summer slump, FRB's production index (1935-39 average: 100) had climbed to a postwar peak of 192 in November.

President Truman's Council of Economic Advisers, issuing its second annual report, took some of the bloom off this rosy figure. In a rambling, 31-page document that gave no help in charting the U.S. economic course, the council vaguely wondered: "[Will] full production, in catching up with market demand, force disastrous price breaks, result in production cutbacks, and thus prove to be its own undoing?"

At a press conference later, the council's mild-mannered chairman, Edwin G. Nourse, former vice president of Brookings Institution, was less chary. The scarcity of coke, steel, pig iron and railway cars, he said, "is likely to prevent production from overshooting the mark. . . . Given a fair crop year, there's a distinct possibility that 1948 will see an abatement of the inflation."

Businessmen were not too worried. FORTUNE'S semi-annual poll of 28,200 top executives found some 60% expecting the boom to continue at the present level or even higher in 1948. Only 37% expect a moderate downturn (last May 74% expected a slump by year's end). Some 90% expect to keep their present payrolls or boost them. Almost none expects to lower prices in the next six months.

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