The State of American Economy

Described by Eisenhower economists as a sideways movement, the downward turn in 1954 was overcome in a relatively quick reaction. Late in the year the major indices began to move up again and by July 1955 it was evident that those who were optimistic and bullish would win out. The automobile and home construction industries outdid themselves. Automotive experts had hoped to dispose of about six million cars during 1955; the public gobbled up 7%2 million. New housing starts were expected to reach about one million; actually, there were about 1.3 million. The Gross National Product, the total of all goods and services produced, climbed close to the $400 billion mark. Consumers increased their spending by $20 billion—probably accounting for the quick recovery from the 1954 “sideway slip.” But to do this, they drew on their saving accounts and bought on the installment plan as they had seldom done before. By the year’s end, urban mortgages w...