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A f c * f' 1 o w ? k~ ~ ¿ u ,__^a _ . , , . —-g.^-«-g?-^i— o / ^ '3^— 7 ^ </-r^ —> — *^' ^ — G*-^¿ ^ b• _ _____ c ^f„ , ._ (/ ^ ^ ...... ^>— -<~ ,, „; _ X • <f ' f- < r Q^/~3^-*--~* J<&~r-~—T^^í~c- / • —^~i 6 g.^ <r ti,^ ~ s^ f<&<- ■ G? ■**X r _ >-*-a_-*_^- * , ú y • o Jpç^^, ¿5? 3 ï ^ C - c ,r N 4 i, \ November ___ 30 , 1944-• _ ’ m __ Mr, it. G. ir.ells, frellsville, ftiew York. Dear Mr. rsells: --- It occurred to me on reading your well-reasoned letter of iMovember ¿4 in regard to my recent speech that you may have seen only a necessarily brief newspaper ac count, and I am therefore venturing to send you a copy of the entire text. Ifthile I think it clear from the text that I would be as concerned as you would be about anything that contributed to an upward spiraling of prices, as a result of your letter I have added a line or two to the text as it will be printed in the Federal he serve Bulletin so that there will be no possibility of misunderstanding on this point. Kvhat I have added points out that unless wages of the lower paid groups can be increased without increasing prices, the deaired increase in consumption would not, of course, be brought about. Sincerely yours, M. 5. Eccles, Chairman. Enclosure ET:b • W ,, ttMcftvedm otoo* NOV 2 3 1944 to*» <* * 11» p u wei 4iiwerp»dyeie» ¿U - ^ >2 .^ Rise in Prices! HeM Needed in Steel Industry Inland Chairman Asserts SolvencyHinges on Move Following Pay Changes # The steel industry finds it im possible to absorb further in creases in costs caused by wage adjustments without raising prices of its products if it is to remain solvent, Edward L. Ryerson, chair man of Inland Steel Co., said yes terday. Discussing War Labor Board proposals for still higher wage rates for steel workers, Mr. Ryer son asserted that because of ceil ing prices on products and higher costs of operations, the industry j is already showjpg a subnormal return on invested capital. "Our present schedule of prices remains unchanged since 1939, y e t; we have already had two general wage advances and under the re-I cent Labor Board directive we will j have to make additional upward1 adjustments,” the statement said.: “The *~tter, though indetermin able, be substantial. "Be. ~s the wage increases, our costs have risen due to a variety oi other causes, including ad vances in the prices of many o f . ¡the materials we purchase. As a ! result, our operations show direct • losses on a number of products and this must be true in the steel industry as a whole.” Mr. Ryerson recalled a recent survey by National City Bank of New York, showing that in the first nine »months of 1944 twentysix iron and steel companies showed earnings of 4.9 per cent, annual basis, on net worth, com pared with 8.9 per cent for 246 companies In various manufac- j turing activities ffeckoned on an annual basis from the like period. Suggesting that the steel indus try has been discriminated against, Mr. Ryerson said that “it seems clear the steel price schedule should be properly adjusted if sufficient risk capital is to be a t tracted to this key industry in order that it may be prepared to Digitized provide for a FRASER high level of employhttp://fraser.stlouisfed.org/ ment in the post-war period.” Federal Reserve Bank of St. Louis Thank you for your recent letter and copy of your speech. If depressions always follow inflationary booms, why not prevent depressions by avoiding inflation. It seems questionable that a serious inflation can be prevented. We have gone so far in devaluation and there is no relief in sight for demands from almost every quarter for increased wages and salaries. Prices must go up and dollars go down. Perhaps you saw the enclosed clipping. The devaluation of the franc it seems did not make France prosperous. How much alike are we to French thought when the church properties were "taken over" and assignats issued?
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