WHAT THEY'RE SAYING

In an anxious economy, the moods and opinions of top businessmen take on added importance. While their opinions were mixed, their mood last week was still generally optimistic. A sampling:

> ROBERT W. GALVIN, chairman of Chicago-based Motorola, Inc.: "I see a continued rise through 1967. Whether auto production is up or down 2% doesn't matter. The new technology will result in new products and new demand. Technology is making the present means of production obsolete, so we have to invest to stay in business and capital investment will thus stay high. I don't see any break in the confidence of businessmen."

> JOHN L. COOPER, president of Massachusetts Investors Growth Stock Fund:* "The earnings of the major companies will be higher in general in 1966, on the order of 10%. On that basis, it would seem logical for the stock market to recover somewhat. But we have had a change of psychology hard to predict about, and this is complicated by the fact that there are unpredictable world events--such as the trend in Viet Nam--that will affect the market."

> KELLEY ANDERSON, president of Boston's New England Mutual Life Insurance Co.: "The economy is continuing upward. Taxes should go up, although I wouldn't like it. And Washington should cut out some of these foolish expenditures."

> TILFORD C. GAINES, vice president of the First National Bank of Chicago: "The President would be well advised to have a tax bill introduced in Congress. If it is not needed by August, he can let it die. But if it is needed, then all the committee work will be done. As for the economy, defense spending will level off some time in the next year, and this will have a depressing effect. However, right now all evidence points to a continued upward trend in the months ahead."

> JOSEPH L. BLOCK, chairman of Chicago's Inland Steel Co., who in 1962 helped break the steel price rise by refusing to go along with the rest of the industry: "The wage-price guidelines are unjust, discriminatory and harmful to the economy. Steel and a few other so-called basic industries are expected to adhere rigidly to the prevailing prices, while thousands of others go their merry way and raise prices at will. The Government's attack on inflation should be through the exercise of proper monetary and fiscal policies. Federal expenditures such as public works should be postponed, money tightened and taxes raised."

> THOMAS F. PATTON, chairman of Cleveland's Republic Steel: "A tax increase at this time may prove to be not only unnecessary but also injurious to continuous sound growth. The nation has not yet had sufficient time to feel the full deflationary effects of the increased rates on borrowing, high social security taxes, the upward adjustment in the schedules for tax withholdings and the renewal of certain excise taxes."

> MILLS B. LANE JR., president of Atlanta's Citizens & Southern National Bank: "You know we Americans always overdo things, whether it's an ice cream cone or Scotch and soda. In not too long, we'll be looking for ways to stimulate the economy. The slowdown is beginning already."

> HERBERT JOHNSON, vice president of Chicago's Continental Illinois National Bank & Trust Co.: "It is quite obvious that some sectors of the economy are now entering a phase of less imperative expansion. Some state and local bond issues, for example, have been approved by voters but priced out of the market. So the projects are being postponed to this fall or 1967 or 1968. The nice thing about this is that these projects will ultimately come on stream in years that can use them more than 1966."

> EDWARD B. RUST, president of the State Farm Mutual Automobile Insurance Co. in Bloomington, Ill.: "The consumer's purchasing power has been undercut by the increase in prices in everything--far more than the indexes show. In the long run, the consumer will have to cut down. In our business, people are shopping a lot harder than in the past few years. On the other hand, industry's tremendous capital investment is really a stable factor, and all these commitments are long-range enough to carry through any short-range slump caused by the auto situation."

> ELLWOOD F. CURTIS, president of Deere & Co. in Moline, Ill.: "We're on a plateau--a high plateau, with very minor inflation. I don't feel the economy will go down. The main strengths are full employment and tremendous purchasing power."

> ROBERT M. MORRIS, president of West Virginia's Wheeling Steel Corp.: "I'm not bearish at all. Business will probably slow some in 1967, but I think 1966 is in the bag. Even in the third quarter, the problem will still be one of producing and delivering rather than insufficient orders."

> NORMAN ROBERTSON, vice president of Pittsburgh's Mellon National Bank & Trust Co.: "The only problem is that people have become so accustomed to superlatives that even a moderate decline may produce a disproportionate reaction. Let's not become statistical hypochondriacs."

* Sister fund to Massachusetts Investors Trust.

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