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About Nyssa gate city journal. (Nyssa, Or.) 1937-199? | View Entire Issue (Dec. 27, 1973)
Thuriday, December 27, 1973 The Nyssa Gate City Journal, Nyssa, Oregon BABSON'S REPORTS plan of price stabilization is being put back to work. Con sidering the prices key farm commodities are com (Continued From Page I) a "must,” such as siding, manding, the high allocation the year, and while we are insulation, storm windows, rating the Administration is hopeful of an upturn in the doors, and supplemental asking on fuel supplies tor final three months this is slopgap spaceheating units. farming purposes, and the by no means certain. It does Auto parts replacements present lush farm incomes, look as though we will ex* should enjoy higher de demand for agricultural ma perience a true recession mand, especially where a chinery and implements is (at least two successive quar car's idleness does not ne extremely brisk. With a little ters of decline in the "rear' cessarily mean longer life help from Mother Nature in GNP). for some parts (tires, for In important crop areas, the stance, tendtocorrelate with expansion of acreage put to INDUSTRIAL PRODUCTION miles driven). Raw ma seed assures a new record If we can escape a pro terials and energy supplies crop outturn in 1974. There tracted petroleum shortfall, permitting, there should tie should also be some increase industrial production may not no letup in output of ma in livestock and poultrysup suffer too badly, but a de terial and components for plies over the next twelve cline seems inevitable for power generation and trans months. The picture as part of the year. Key areas mission, equipment for a whole promises more rea have already felt the sud oil and gas exploration, off sonable food prices, par den repercussions from the shore and onshore. ticularly after (tie 1974 gro fuel crisis. The downtrend in While the crestover pat wing season is well under home building will hurt manu tern may already have way. facturers of building pro formed, the bulk of the slide ducts and home furnishings. in business will be centered "A PENNY SAVED IS..." Painfully higli consumer pri in 1974 Consequently, the NOT GOOD FOR BUSINESS ces and the intense need to Federal Reserve Index of Although consumers have conserve fuel and energy production may well ave been a bulwark against re will produce areas of both rage 5$ below that of 1973, cessions for nearly three de strength and weakness in the and (lie uniqueness of theexis- cades, they may not be the consumer durables field. Lei ing climate suggests the stopper this time. Spending sure-time products (boats, drop could tie a bit more, will be hurt by weakened recreation vehicles, skis, possibly 6%. consumer confidence, soar snowmobiles, pleasure air ing living costs, and the craft) will suffer from the burden of installment pay FARM PROSPECTS crunch of scarce and high- The economy should dp- ments. Now, the high cost cost fuel as well as from rive some support from the of both heating and trans consumers* needtoestablish agricultural boom. With the portation fuel along with ga spending priorities Autopro- low supply levels of most soline shortages may limit duction is already suffering agricultural commodities In shopping jaunts. Neighbor from lack of demand for relation toexpecteddomestic hood mini-plazas and local "gas guzzlers." There will retail outlets will benefit and foreign demand, the push be high priority on certain from this situation. Since is on to expand farm pro items which were once non- duction Acreage previously neighborhood shopping tends essential but are now to tie less extravagant than Idled under the Soli Bank that done in the impulse buying supermarkerts, we foresee a periodduringwhich consumers will channel more of their disposable in come into savings and debt repayment. Long term, this is healthy and lays the groundwork for the next cyclical upbeat in the eco nomy, but the short-run im pact is negative. Less con sumer spending will mean reduced inventory buying, with perhaps some backup of goods. EMPLOYMENT-PERSONAL INCOME Aggregate personal in come during 1974 will not show the vigor of the past two years. It will be up, but boosted more by trans fer payments (social secu rity, unemployment compen sation, etc.) than by ear ned income. Salaries and wages and income of pro prietorships and partner ships will average lower than in 1973 because of the slo To convey our true wer business pace. Support will come, however, from appreciation of wage hikes in multi-year union pacts, new agreements, your patronage over the yeare. may we wish and built-in cost-of-living you and yours a fruitful. Happy New Year. adjustments. Employment faces reductions in 1974, and the jobless rate could ave rage 6%, but may run as much as 7% at the topmost point. As in the early years of this decade, unemploy ment will be difficult to shrink because of the flood of new workers into the la bor pool. improvement in this sector which utilizes so much man power and materials. Re sumption of vitality must await a longer spell of anti-recession credit policy than the past six weeks. By late spring of 1974 or some time during the summer, re sidential building should bot-, tom out, probably near the 1.1-million annual rate, and thereafter the economycan derive much-needed support from this source. For 1974 as a whole, new residen tial starts should approxi mate 1.3 million units. In dustrial andcommercialcon struction bolstered over all building activity for a good part of 1973. But high costs, supply shortages, and now the lack of clarity as to consumer spending plans and shopping patterns are likely to cause some hesitancy for nonresidential building during the coming year. CORPORATE PROFITSAND DIVIDENDS The amazing 1973 gains in overall business profits af ter taxes were due to basic and uncomplicated business principles and not to pro fiteering on the part of cor A CHEERY NEW YEAR! gay good wishes are chirping your way FRANK AND DORIS ARBOGAST CHET'S MOTEL INew Year FROM THE BOTTOM OF OUR HEART, WE SAY “THANK YOU’ AND HAVE AVERY MALHEUR TELEPHONE CO. BUILDING ANDCONSTRUC- T1ON While the nation's hous ing needs are still enormous, tight and costly money has snuffed out the boom after the high rate of residential starts in 1972 and the first half of 1973. Government figures on building permits issued give no hint of early porate enterprises, as clai med by some unthinking cri tics. Fact is, we saw what happens to profits when plant and equipment operate at full capacity and there is little simultaneous cut-throat price competition. For 1974, however, the outlook is less promising. In general, we cannot count on the strong demand of the past year, and costs will continue to move upward. The situation will be worsened if fuel allocations prevent profitable use of operating facilities. But, barring extremes, net cor porate profits should dip about 14% overall, with the greatest year-to-year slip page in the first half of 1974. But some firms, notably those with food-related ope rations, may even stack up favorably, vs. 1973 because of the afflictions they suf fered at least part of last year. As to dividend disburse ments, if operational dis ruptions are not overly se vere, corporate dividends can increase again in 1974. The reason for this is that anti-inflation rules permit ted only a tiny slice of 1972 and 1973 profits to be paid out. Page Eleven POLITICS--DOMESTIC AND INTERNATIONAL Politics caused a good deal of the uneasiness and uncertainty which marked 1973. The unending sequence of "shocks” in connection with the investigations on Capitol Hill make any rea sonable forecast of politi cal prospects for 1974 an exercise in futility. It is to be hoped that the biennial congressional and gubernato rial elections upcoming next fail will produce some sem blance of reason to replace the chaotic circus. While those most eager to have the President impeached may have lessened their efforts just how much of a working relationship between the Ad ministration and Congress will be restored is ques tionable. Past election years have usually brought forth some productive efforts on Capitol Hill; these will be most vitally needed in 1974. There should be no federal tax increases except on the Social Security impost in the year ahead. While the staff of Bab son’s Reports is hopeful that there will be no resumption of fighting in the Mideast, negotiations leading to more stable conditions there will be arduous. Arabs will doubt less use their oil strategy as an overhanging threat for years to come in dealing with the industrialized nations of the world, although they may moderate their attitude some what. The emergence of underdeveloped nations is never smooth, and unrest will surface from time to time. We do not expect, however, actual military ac tion between the great po wers in 1974. leLs than short-term in the past two years, will recede more slowly This means healthier bond markets in 1974 than for the past two years. Investors requiring the best possible yield on their investments should find, therefore, that bonds, preferred stocks, and even some common stocks ge nerally regarded as “income issues" can now provide an (Continued On Page 12) INTEREST RATES ANDTHE BOND MARKET Late in 1973 the mone tary authorities at least tem porarily relented their anti inflation credit constric tion in order to forestall a serious recession duetofuel shortages. Confronted with both inflation and recession, the Federal Reserve may be forced to vary its tactics. For now, the need to protect the economy prevails. So the peak in interest rates may have been seen for this go-round. With an economy propping monetary policy and business needing less borrowed capital as activity eases, short-term money rates will likely back away from recent peaks, but long term rates, which had risen Nolan Field & Waldo Ins. HAPPY NEW YEAR NYSSA TAVERN ishing all of our good friends New Year Owi pKKfCI toja* aPmeefad Ite# 'IfMifayicM! MORRISON ELECTRIC CO. health and happiness Vip’rc greeting the New Year with hope that it brings to all our wonderful friends and customers the best of everything ... health, happiness and success. With many thanks for your good will and patronage, we sincerely wish you and your family a very joyous year. We look forward to serving you again, soon. SUGAR BOWL NYSSA AUTO PARTS