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About Medford mail tribune. (Medford, Or.) 1909-1989 | View Entire Issue (Jan. 1, 1959)
.f o 1 M 1 ! m (Lyinnibeir Dindtuisliiry Biggest Question Is Credit for Building Homes (Editor's nole: The follow ing article discusses what's ahead this year for the lum ber industry, It is written by Robert M- Ingram, pres ident of the National Lum ber Manufacturers associa tion and president and gen eral manager of the E. C. Miller Cedar Lumber com pany, Aberdeen, Wash.) By ROBERT M. INGRAM Lumber manufacturers have many reasons to be optimistic about their business prospects for the year ahead. The economy appears to have recovered almost com pletely from the recession of recent months and the current upsurge in business generally can be expected to continue well into 1959. The biggest question mark, of course, is credit-particularly with regard to new home construction. Certainly, for the next few months at least, we may ex pect the many pressures now at work to restrict the avail ability of mortgage credit. Powerful Forces Among the powerful forces involved here are recent in creases in Federal Reserve Board's discount rate-the fee charged for loans to commer cial banks. Another factor is the pros pect of .a federal budget defi cit of $12 billion or more for the current fiscal year. These developments and competition from other seg ments of the economy for available money supplies may make it more difficult to ob tain FHA-insured and VA guaranted home financing during the early months of 1959. On the other hand, the new Congress which convenes this month is likely to waste little time in considering legisla tion designed to enlarge the role of government - backed mortgage credit in the over all housing picture. Too Early to Predict It is still too early to pre; diet how far Congress will go. But, obviously, many of the nrnhlemq facing home build ers todav would be eliminated if pur lawmakers were to re move the artificially low in ID'S A $$ r3 n$k m re 1 1 MEtfSfeR II NX u terest ceilings on FHA-VA-backed mortgages. Instead of being tied to ar bitrary limits, these interest rates should be allowed to fluctuate according to current market conditions in the same manner that convention al interest rates go up or down depending on the an cient but irrevocable law of supply and demand. It is encouraging to note that a number of top govern ment officials, including the chairman of the President's Council of Economic Advisers and the Undersecretary of the Treasury, recently spoke out in favor of flexible interest rates on government -backed housing loans. Conventional Financing With the prospect of a tight FHA-VA mortgage market-at least during the early, months of the coming year - conven tional financing should ac Paqes 1-6 Medford MEDFORD, OREGON, THURSDAY, JANUARY 1, 1959 RUSH FOR NEWS This New York newspaper dealer is having a busy morning indeed, as commuters crowd in to buy the first local papers available in 20 days. All of New York's seven major dallies had been completely shut off by a dehvery men's strike. Whatever you've been wanting ... you'll find in these impressive groups of fashions that have all been marked down to clear . . . now they can be yours for a mere fraction of the original price . . . we MUST make room for new Spring merchandise arriving daily. Shop early for best selection. THE BEST VALUES YET IN . . . Coats 0 Dresses Sweaters Raincoats 0 Sportswear Blouses Robes Bras 0 Accessories Sale FASHION CENTER Slip count for a greater share of home construction during 1959. Since the basic demand for housing is still one of the strongest potentials of the economy, it seems reasonable to expect that private non farm housing starts next year will equal, and perhaps ex ceed, the 1.1 million units in 1958. Judging by the replies 1o a recent nationwide survey con ducted by the National Lum ber Manufacturers association among leading producers of lumber and wood products, private non-farming housing starts this year may increase 3 to, 4 per cent above the level last year. If 1959 turns out to be a reasonably good year in home construction, it seems likely that the lumber industry will produce and sell as much or more lumber than in 1958. Fashions ... All From Regular Stock, at Low, Low Prices! 0 Formals Skirts Jewelry 0 Girdles 0 Handbags 0 Gowns Begins Friday at 9:30 a.m. We Are A Charge Plate Store Buy Now! Pay in February ALL SALES FINAL! At this writing, lumber manufacturers believe that 1959 production may be up something like 3,8 per cent from 1958's expected total of about 32 billion board feet. Prediction Assumes This prediction assumes that several markets, in addi tion to housing, will expand next year. According to the NLMA out look survey, non-residential construction will use 2 to 3 per cent more lumber than in 1958, farm demand may rise about the same percentage, use of lumSer by the furni ture industry will increase nearly 4 per cent end railroad consumption will gain be tween 1 and 2 per cent. Exports and the use of lumber for wood containers are expected to be about the same next year as in 1958. Especially encouraging is the prospect that demand for No. 243 Tribune ' ' '''''' 4 ' wood paneling will increase nearly 5 per cent. Lumber manufacturers ex pect their cost of doing busi ness to increase about 4 per cent. Prospects Rated Many producers say their prospects for obtaining an adequate supply of raw mate rials next year are only fair; others rate their prospects poor. The industry plans to spend about the same amount for new plants and equipment next year as in 1958. Also, the level of employment is ex pected to figure out about the same as in 1958. If current indications are sustained in the months ahead lumber manufacturers may find their gross sales up 6 to 7 per cent and their profits after taxes up 5 per cent from Ihe unusually depressed level of 1958. Net profits after taxes averaged only 0.9 per cent of sales during the first id U Vacation LUKUKI00 KVf f if . f i j'ii ff M. ' A T 7 Jf Tf IB'fJI no Another IM RIESTT SHUNT i YOUR FRIENDLY CREDIT JEWELER q mm 5 d six months last year. At this point I would like to emphasize the need for labor to understand that the lum ber and wood products indus try has just beeen through a most difficult year. Perhafis the most signifi cant figure, in 1959 will be lumber consumption. NLMA's survey of leading manufac turers indicated that con sumption this year will total about 35.8 billion board feet 3.8 per cent above 1958's ex pected figure of 34.5 billion feet. Influence Production If the many factors that influence lumber production and consumption can be lumped together and their probable effect appraised in a single senfence, I would say this ykar will be a moderately good year for the lumber in dustry. There is no doubt that our competitors - the manufactur ers of steel, brick, aluminum Cy U If 111! II I Time Will Soon Be mmim l.lil QUlLTtD! TJT7 15 N. I i " m fi ill I kvi r i iiiiiiaBiiii ' Miir- m Mr raws;. 11 , nwp 9 and plastics- will accelerate their efforts to secure a great er share of lumber's markets. But the lumber industry after more than a quarter-century of inactivity on wood's national promotion front is finaly doing something in a united way to counteract this force. Supplementing the out standing merchandising - ad vertising programs being con ducted in behalf of specific brands and species, lumber manufacturers hvve launched an overall National Wood Promotion program to give greater purpose and direction to their regional campaigns. Building Material , This new national effect will concentrate on promot ing wood as a modern build ing material-superior to its competitors in strength, beau ty, economy and versatility. Our objective will be to make the customer think fa vorably of wood, thus improv J I I VVy Here Buy Now JJ ( AJTn?PR nrvfi rvTHi WE GIVE GREEN STAMPS Central ing the climate for accept ance of regional and brand name product promotion ef forts. In its recent outlook sur vey, the National Lumber Manufacturers association re ceived a special mandate to go all-out in this direction. Asked to suggest what the association could do to bolster industry prospects for the coming year, lumbermen re sponding to the survey gave We Will Be CLOSED FRIDAY & SATURDAY January 2nd & 3rd FOR INVENTORY Sims Cycle & Hobby Shop b 'J c "i on Andy's Easy - 7 95 top priority to advertising and promotion. HELP US! We Need Clothing, Shoes, Dishes, Furniture. We Pick Up. HELP OTHERS! The Salvation Army SPring 3-7335 Credit Terms I I MONE I 1 I U J S010.T0 Now and Have This 1 1 s i r i raid ror in i ime For Your Vacation scemsnf mil r m . FSil l ImtlTtt a ocb Pyr chaser - ent.Hes fo replace f ooditiott '-) Sr tt USE ANDY'S 1 i
