In the Pink

Noting that pink has become the U.S. color of 1955, in house furnishings as well as in clothing for both men and women, Chicago's H. W. Gossard Co. (girdles) last week announced a change of policy. Instead of emphasizing its recently popular blacks, blues and reds, Gossard will feature a new line of foundations in pink. Psychological research, said Gossard, had shown the reason for the U.S. color trend: "Pink represents a mood of sentimentality, good times and luxury."

There was evidence to support that conclusion. Last week the U.S. economy was producing more goods and services than man has ever enjoyed anywhere. When the business and governmental statisticians finished their computations on the first quarter of 1955, they came to an almost unanimous conclusion: this will probably be the best year, economically, in U.S. history. Factories are nearing a record level of production, workers are taking home more wages than ever, many corporations are making more profits than ever.

Paychecks at the Base. In the first three months of 1955, the U.S. produced goods and services at the rate of $369 billion a year, a firm indication that the year's total will go beyond 1953's alltime record of $365 billion. New orders received by manufacturers were about 20% above the total for the first quarter of last year. House construction was moving at the record pace of 1,400,000 starts a year. Retail sales were the highest for any first quarter on record. While durable goods led the way, the prosperity cut across nearly all lines. Last week the steel industry was operating at 96% of greatly expanded capacity, after reporting firstquarter profits about 70% more than a year ago. (See BUSINESS.)

At the base of the prosperity was the greatest personal income of all time. A striking example came from the auto industry, where the average weekly pay of General Motors Corp. employees in the U.S. reached an alltime high of $103.79. Rising paychecks were not being offset by rising prices; the national cost-of-living index has not changed for four months. From their record income, consumers were spending more than ever before, spreading prosperity almost everywhere in the land. In Texas, where retail sales are running about 18% above last year, the University of Texas' Bureau of Business Research reported that retailers did as much business at Easter this year as they did during last year's record Christmas rush.

Petunias on the Road. Probably the greatest public indication of the prosperity is on the highways and in the parking lots. This week the U.S. auto industry passed the 3,000,000 mark in 1955 auto production, the earliest that mark has ever been reached. Lined with brightly colored new cars (even some in girdle pink), parking lots are taking on the appearance of petunia beds. Said Drug Salesman John Tinder of Seymour, Ind.: "There's one feller in town who has a black car. Why, everybody knows where he is all the time."

Even near the soft spots, the economy seems to be in the pink of condition. Farm income is still down, but it showed a slight tendency to rise in April, and Midwest farmers have flocked back into the market to buy equipment (International Harvester Co. sales during the last five months were 15% above the same period of last year). Unemployment appears to be static at a hard core of about 3,000,000, but employment is rising. Credit was near a record high, but the Federal Government was gently tightening in vital spots to hold the credit line.

In the economy's condition at the end of the first quarter, 1955, there were no symptoms to confirm the judgment of the doom criers of a year ago, e.g., Illinois' Democratic Senator (and sometime economist) Paul Douglas, C.I.O. President Walter Reuther and A.F.L. Teamsters Union President Dave Beck, who had wailed that the U.S. was in, or dangerously approaching, a Republican depression. While Douglas & Co. had demanded federal action to avert a depression, the Eisenhower Administration applied only its philosophy of free play for private enterprise with a nudge or a check, whenever necessary, by the Government.

All over the U.S. there were indications that the people believe that their prosperity is durable. Confident businessmen were greatly increasing their spending for new plants and equipment, e.g., the Ford Motor Co. announced that it will spend $625 million for expansion in the next three years. The immediate future (see opposite page) looked even better than the rosy, prosperous present.

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