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has such an Important bestring upon the duration of the war that it is 

 probably the most important current . development. If India would Join 

 wholeheartedly with China and the other allied nations, it might be 

 possible to stop the Japanese before they completely cut off Russia 

 and China from help from the United States and England. 



In this country we are rapidly shifting to all-out war 

 production without seriously curtailing the demand for farm products. 

 In a number of industries the conversion to production of war goods is 

 made v;ithout a great deal of construction, retooling or unemployment. 

 The extent to which this shift is taking place can be illustrated by 

 statistics compiled by the Federal Reserve Bank of New York. Compared 

 to February, 19^1, the production of producers' goods in February, 19^2, 

 v;as up 31 points to 1^3 per cent of the long term trend. Producers* 

 durable goods were up ^0 points and producers' nondurable goods were up 



19 points. On the other hand, the production of total consumers' goods 

 dropped 2 -ooints to 92 per cent of the long term trend. Consumers' 

 durable goods were down 50 points and consumers' nondurable goods were 

 up 6 points. Most of this decline in the production of consumers' durablt 

 goods has taken place recently. The decline from '^anuary, 19^2, to Fc"t>- 

 ruary, 19^2, was from 6S per cent to 5I pe^ cent of the long term trend. 

 During the year ending February, 19^2, the cost of living rose 12 per cen^ 



Scarcities of skilled labor and essential materials are most 

 likely to Impede the war effort. Efforts are being made to train more 

 and more workers in the lines where bottlenecks are likely to appear. 

 Materials are being conserved for war purposes. We have got used to the 

 A limitations on automobiles, rubber tires and electric refrigerators and 

 we shall have to get used to a very large number of other limitations. 

 Just this week there has been an order prohibiting buildings either on 

 the farm or in the city costing more than $1,000 except in defense areas. 



