Sliders & Saucerites

Economists know that business is slipping, but they are having trouble finding a way to describe 1) what is going on, and 2) how bad it will get. Last week, at a credit conference of the American Bankers Association in Chicago, Economist Walter E. Hoadley of the Armstrong Cork Co. produced a list of the newest expressions used by the most contemporary schools of economic thought. Samples:

P:Sliders--Those who expect a fairly steady downward movement in the economy for all of 1954.

P:Saucerites--Forecasters who think business will drop in the first half, then pick up in the last half of the year, like the cross section curve of a saucer.

P:Rolling adjustment--A period in which supply catches up to demand in one industry after another and selling and competition become tough.

P:Dynamic doldrums--A time when economic indexes are holding still or dropping slightly, while business conditions are excellent.

The economy last week provided some fuel for both the sliders and the saucerites. Sliders, for instance, could point at a Commerce Department report that showed unemployment up 510,000 in January, to 2,300,000. The seasonal letup in building activity and post-Christmas layoffs in retail stores accounted for most of the drop, but total employment slipped to 59.8 million, below 60 million for the first time since March 1952.

But the saucerites had their arguments, too. Bethlehem Steel Corp. announced the highest sales (over $2 billion) and net profit ($134 million) in its history in 1953, reflected its confidence in the future by a surprise boost in its dividend for the first quarter from $1 to $2. After the announcement, the stock shot up 3^ points in a single day's trading. Other companies reporting record 1953 sales included National Biscuit Co., Union Pacific Railroad and St. Regis Paper. The Pennsylvania Railroad reported that its revenues were the second best in history.

Cheered by such reports, the stock market went right on climbing. The Dow-Jones industrials average tacked on another 2.74 points to reach 292.39, within a whisker of the peak reached at the start of 1953. Some saucerites felt that the ride up the far slope of the saucer had already begun.

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