'^^^/Z . WESKL:^ Iv^ARKET REVIEW AND FARM OUTLOOK 



-^^^'^Z/- ^ By (j^ L. Jordan 



f^^^ ^ Professor, Agricultural Economics 



^^' 'A University of Illinois . 



'•^ • ■ College of Agriculture 



, / • ■ , ■ ^..._ ■ 

 (P/repared September 1^) 



The/general demand situation continues favorable with indexes 

 of industrial production holding up at previous high levels but increas- 

 ing less rapidly than in recent months. We are now entering a phase of 

 -^ "activity comparable to that reached in late 1915 and early 1916 when 



industrial production reached a peak above whiph it v/as very difficult 



. . • .J 



to go. As industrial production reaches full capacity of output there 

 will be a shift from one type of production to another, rather than 

 further increases in production. The government has set up an organiza- j 

 tion in Washington to enlarge the program to simplify and conserve 

 materials going into goods for civilian use in order that production for 

 defense can be increased. However, Just because production approximates 

 the meLximum capacity does not 'mean at all that the demand for goods will 

 not increase, .. 4 



Following the early part of 1916 the price level rose ^ery 

 rapidly in spite of no appreciable increase in production of m(Smifactures, 

 There is some indication that the same factors that caused the pri 

 rise in 1916 are working at the present time; namely, increased v;age 

 rates and weekly earnings. The amount of money available for purchases^ 

 . of farm products depends not upon the volume^of iKTSustrianT^Gutput but 

 upon the amount of money received by industrial 8.nd other wot'kers. Not 

 only are wage rates being raised voluntarily, bu'b at the preseiat time 

 the railroad labor unions have threatened to strike unless "their wages 

 are /^ised, In some eases as much as ^1 per cent, « 



A statement released by one of the larger commercial banks 

 points out that hours of employment in 10 defense Industries for the . 

 months January to June inclusive, 19^1, were 2«9 per cent greater than 



