The Canadian Forum/Trade and Industry/1920-10

Review:Quiller-Couch:On the Art of Reading (Fairley)

The Canadian Forum/Trade and Industry 1920-10 written by G. E. Jackson

The first in a regular series.

TRADE AND INDUSTRY

	June 1920	July 1920	August 1920	Sept. 1920	Sept. 1919
Wholesale Prices (Michell)	296.9	292.9	274.4	254.5	250.7
Family Budget (Labour Gazette)	$26.81	$26.92	$26.60	. . . .	$22.88
Volume of Employment (Employment Service of Canada)	+1.3%	+1.4%	-0.5%	+0.2%	. . . .
Average Price of Twelve Canadian Securites (Mitchell)	122.5	125.2	122.9	116.6	132.0

The Canadian Forum will devote this page in each succeeding issue to the discussion of trade and industry. It will not compete with existing financial journals, by trying to guide the public in its choice of investments. It is hoped instead that the man of business may be helped in a very general way, towards an estimate of the changing situation.

Men of business everywhere face a difficult alternative. On the one hand, the volume of financial and trade information, bearing on their daily problems, is great and grows larger year by year. The firm, whose size does not warrant it in creating a special intelligence department, is driven to finding a makeshift. On the other hand, if it turns for relief to one of the mechanical systems of forecasting the future, which is sold commercially, such a firm does so with an uneasy suspicion all the time, that the tremendous forces governing the tides of trade may refuse to be bound within the limits of a formula.

A guide to the changing conditions of business, sufficiently flexible for men in many walks of life to turn it to good account, may perhaps be found in a simplification of four statements. The first of these is the general trend of wholesale prices; the second is the general trend of retail prices, which may be supposed as a rule to lag behind the trend of wholesale prices, but to move in the same direction; the third is the growth or decline in the number of workers employed in trade and industry; and the fourth is the rise or fall in security values, which represents the market estimate of the three former conditions, though this estimate is not necessarily a correct one.

So far as we know, there is not at present a publication in Canada which combines these four things in a simple statement. One of the reasons for this is the fact that records of employment and prices are as a rule a little out of date. We feel justified in using these records monthly, only because we are enabled to publish them complete, with one exception, when The Canadian Forum goes to press.

The figure for wholesale prices which we quote at the head of this page has been very kindly placed at our disposal by Professor Michell of MacMaster University and is also published in the Toronto Globe and the Manitoba Free Press. His index number is a new one, and is based on the wholesale quotations of forty commodities, including twenty foodstuffs. It has the merit of giving the facts several weeks in advance of the figures prepared by the Department of Labour at Ottawa, and is, we believe, the more sensitive of the two.

The figure for retail prices is that officially given by the Department of Labour, in its monthly calculation of the cost of the family budget for a Canadian working man. No private calculation of retail prices can command the ame authority, but its compilation is a task so laborious, that it can never be quite up to date.

The figure for the volume of employment in trade and industry relates to the second week in each month under review. It is taken from the weekly bulletin issued by the Employment Service of Canada, and is based on the weekly comparison between conditions at the moment, and those of the middle of the previous January. The calculation is made from the returns of 5,000 firms in all industries, and 700,000 workers, and may be taken as being substantiaHy accurate.

The figure for the change in security values has, like the index number of wholesale prices, been supplied by Professor Michell. His average is based on the following common stock quotations: Bank of Commerce, C.P.R., Dominion Textile, Dominion Bridge Company, Consumers' Gas, Shawinigan Light and Power, Penman's, Russell Motors, Bell Telephone, Canadian General Electric, Lake of the Woods Milling, and Canada Steamships.

The very large fall in wholesale prices during September still leaves the general level above that of twelve months ago. In the month just past it was mainly manufactured goods that fell in price. Professor Michell finds that while the average fall in the wholesale price of manufactures was rather more than 12%, the wholesale quotations of foodstuffs declined on an average by less than 3%. Since the cost of foodstuffs is an overwhelming item in the family budget, there is no certainty that the present break in the wholesale markets will bring a really considerable relief to the consumer, even when retail prices are adjusted to the change.

G. E. Jackson