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Karl R. Bopp before the Laacaeter Bankers Association and the Amerloan Institute of Bunking Hotel Brunswick Lancaster, Pennsylvania Wednesday, November 10, 194-3 'H h y WBÉJ’S AHEAD IN BOSINESS? 1< K y c /, ûAA-^-w <-1— Introduction; 1. 2. 3* I. * 6 * /» /|Cilv\l^/ ) Industry and finance in time ©f war Iamediate post-war prospects The economic possibilities of our grandchildren Industry and Finance in Tise of lar 1. In physical terns Industrial production for war «Ad for «î&rillaa* I w Ist^L m 5d 58 0 1932 IOO 100 1935-1*39 i ' 106 July 1939 —* July 1940 123 72 July 1943 239 Despite 8-10 million in the araed forces. 2, In monetary terms National income and Government finance in billions of dollars Xear 1932 1939 1942 1943 I119U National Income 1929 * Current & 40.0 70.8 117.0 LU-.O 51.3 87.3 123.0 14A.0 Federal Expenditures 5-U 9.5 56.0 86. 104. - 2 - 3« The achievement of balance A. Ehysical factora are basic• Finance must adjust itself. a* Taxes and loans out of current income b. Bank purchases B. The decision is up to us - our actions « 1 6 *\ d*, h if- - 3 - II. Immediate Post-war Prospects 1. Some prospects that are reasonably certain A. Taxation R Permanently higher level Pre-war expenditures $4-6 billion Post-war interest charge alone $4-6 bill. Armed forces - 2 million men " 8 kt? * ^ •* noo " ^ Probably higher than in the 1930’s Deposit structure C. Post-war demand Deferred demand will be large. Currency in circulation up from $5 to $19 billion Deposits War bonds Jjc c -U m p C& dkd* iSrr<. c m U ' - ' J* 14*^. Vn'! L**.Cti*v* ^T' *<\ - 4 - 2. P<ist^weir~goal (. lwfv"‘ f,1' ‘ A. In general a high level of productive employment B» In quantitative terms Year Civilian labor force Employed _______ 1932 1939 1942 1946? 50.9 54.6 54.5 57.5 37.3 44.2 51.9 55.5 3. ^ Armed forces Unemployed _________ .3 •4 4.2 1.9 13.6 10.4 2.6 2.0 A war versus a peace economy A question of markets In war: Government buys In peace: Who will buy what? 4» 5• til. Production creates markets A. General analysis B. The "hitch" : the individual employer versus all employers The challenge n w^xJt <L* " — gThe Economic Possibilities of our Grandchildren 1. Why discuss A. What are we fighting for? 2. Invention and output per man-hour - 5 - A. The facts Output per man-hour (in 1939 §) $2 in 1923 and almost $4 in 1943 3% compounded in industry 1.2% compounded in agriculture B. The explanation a. Invention is a one-way movement Variations among industries b. 3. the discovery of Our grandchildren in 1983 A. B. If output per man-hour doubles every 20 years, our grandchildren's options will be a. Real incomes 4 times ours b. Real incomes 2 times ours plus a 20-hour week c. Same real income as ours on a 10-hour week Will there be any problems? a. IV. A new invention: latent abilities What to do with leisure The part of the Federal Reserve System b
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