NOTES ON FIGURE 13. 



The wholesale price of "ail commodities" as reported by the United States 

 Bureau of Labor Statistics is indicated by the heavy purple line. The heavy 

 red line shows the weighted average prices paid to farmers for 31 farm products, 

 20 of which are shown in the chart. 



Any product that is higher than the wholesale price of all com m odities is 

 high in price. Any product that is lower than the general price level is low in 

 price. 



The average of all farm products was about the same as the general price level 

 until October, 1919. At that time a decided rise in wholesale prices of "all 

 commodities" took place, but prices paid to farmers rose less rapidly. Begin- 

 ning with July, 1920, wholesale prices dropped rapidly, but farm prices dropped 

 much more rapidly. In the spring of 1921 practically everything that farmers 

 sold was lower than the general price level. 



Notice that before the war the price of each farm product varied about the 

 general price level in relatively small cycles, but that when the general price 

 level changed the cycles were made much more violent. However, the cycles 

 continue and may be expected to continue. Any product that is much above 

 the general price level is likely to fall in price and any that is lower than the 

 general price level is likely to rise in price, owing to relatively stable conditions 

 as to the amount of human effort involved in production. 



During the period of high prices before October, 1919, farm prices averaged about 

 the same a3 all commodities. Farm prices were neither high nor low. But some 

 farm products were very high and some were very low. It was not possible to 

 describe the condition of farmers as a whole. Some were prosperous and some 

 were the reverse. In the spring of 1921 practically all farm products were far 

 below the general price level. This has caused the agricultural panic. It does 

 not seem possible that such abnormal price ratios can continue. Other things 

 must come down or farm prices must rise. 



The data for each product are given in Table XVIII. The data for wholesale 

 prices of all commodities are given in Table II. 



26 



