Masonry Magazine August 1968 Page. 10
Washington Wire
(Continued from page 9)
proved with passage of the tax increase. Losses of U.S. gold have fallen recently. But they would zoom again if we eased money here, with "unseemly haste." U.S. officials, therefore, are attempting to "talk" rates down. They are letting it be known-in public statements and private interviews that today's rates are too high in the light of the coming slowdown. They hope this approach will work as before.
History shows that expectations of easier credit conditions can bring a decline in money rates, including mortgage rates. In a month or two, the "Fed" will give expectations a boost, by adding-very gradually to the country's money supply.
INTEREST RATES WILL NOT SLUMP OVERNIGHT.
Rather, you may well see a moderate, steady decline, barely perceptible over the next month or so. The tax hike and the spending cuts must take hold before rates really move. To be sure, mortgage rates have passed their peak already, in some sections. But if history is any guide their decline will be slow in months ahead.
Cuts in bank loan rates will come slowly, too. Banks must pay high interest costs on the deposits they hold. Thus, they will be unable to reduce loan charges too fast. But analysts are forecasting a cut in the key "prime" rate sometime this fall.
IN PLACING HELP-WANTED OR OTHER CLASSIFIED ADS,
here are some tips from a new survey conducted by the American Newspaper Publishers Association. The Association tested a variety of sample ads in papers across the nation. The study showed that a few extra words often pay off in increased response.
These are some of the findings of the comprehensive survey:
-Advertisers shouldn't spare adjectives, just to cut expenses. "Excellent" fringe benefits will help attract more readers.
-Catchy headlines make your ad stand out among the classifieds. A small, easily overlooked ad may be only a waste of money.
-Don't abbreviate if it will confuse the reader. Spelling out "experienced" or "opportunity" is worth the extra line.
CORPORATE PROFITS WILL BEGIN FEELING THE IMPACT
of slower business before many months have passed, say economists in government and industry. They aren't forecasting a slump in sales, though gains will be more modest. But the experts see a squeeze on profit margins that could be quite powerful. It should become more apparent as the tax increase starts showing its bite.
The earnings slump seems all but inevitable. Wage increases of 6% or more are being won at the bargaining table again this year. Once started, it takes time to halt rising labor costs. Price increases, though, will be harder to pass on to buyers. The new taxes make people and businesses more cost-conscious. And the appearance of slack will heat up business competition. The lower net will probably be clearly evident by winter.
The stock market is already reflecting some of this pressure. Its dull behavior in July, often the month of a summer rally, was recognition of the prospects for less corporate earnings. The experts say shares will drift still lower before rising.
THE NEW EDITION OF THE HANDBOOK OF LABOR STATISTICS
is now available. The book, published each year, is the standard reference work on bargaining. It describes wages, fringe benefits, living-cost data, productivity figures, broken down by region and industrial group. The 350-page book costs $2.50. To get a copy, write the Superintendent of Documents, Washington, D.C. 20402.
CONGRESS WON'T ACCOMPLISH MUCH IN THE POST-CONVENTION SESSION
now set. The legislators are anxious to forget Washington and hit the campaign trail. Attendance at the "rump session" will be spotty, particularly in the House. Some Committee chairmen have already said they won't hold any new meetings.
President Johnson is focusing now on his place in history. He feels that the Congress let too many things slide while it debated whether or not to raise taxes. He is determined now to finish up a fitting legislative record, so he forced the leadership to schedule an extra list of "must" bills.
CONSUMER PROTECTION IS ONE AREA
with which Johnson is not satisfied. Poultry and fish inspection bills, for example, have Administration priority. The session may also talk about the controversial mutual-fund reform bill. And there are some house-keeping bills-vital appropriations to be passed.
History shows that controversial legislation does not pass after a convention. The President is no doubt aware of this. But he thinks his "above-the-battle" stance should help this time. And it may help to put the Republicans on the spot.
GEORGE WALLACE'S GROWING POPULARITY HAS STUNNED
Washington politicians. Some now say that the ex-Alabama governor could take 25% or 30% of the vote. The Republican strategy of capturing eight Southern states is obviously hurt. But Democrats fear that Wallace could swing some Northern states to the GOP; Wallace could take away many blue-collar votes in the large, crucial cities.
The House may have to pick the President. The Constitution says it must, if no one wins an Electoral Vote majority.