Regional Distributor Eyes Possible Pause

Robert D. Peterson President Palmer G. Lewis Co., Inc. Auburn, Wa.

first of all, from an overall viewpoint, we defnitely expect 1977 ta be arother good year for distributors. Most distributors had a mighty fine year in 1976, and we're betting that 1977 will offer a continuation of the trends that have developed during 1976.

On the other hand, based upon all of the economic forecasts that we read, we're accepting the possibility that business could begsn to soften by the fourth quarter of next year. Whether it does or not is anybody's guess. In our own company's case, however, we're going to keep the possibility of a slight downturn, by the fourth quarter of '77 , in the back of our mind.

The specific reasons for our business optimism, regarding 1977 , lie within the following areas:

(l) Inflation The USA inflation rate has been coming down steadily for the past two years. In 1975, it fell all the way from 12% at the end of '74 to about 7% at the end of '75. ln 1976, it has worked even lower, down to about 5-ll2%, which is its current level. This is an extremely favorable development for everyone in this nation. It's my own personal guess that our national inflation rate will stay at about its current level in the near future. I doubt that we will see a recurrence of that horrendous 12% rate, which was primarily caused by the OPEC oil embargo and subsequent oil price increases, and was also due to the mess that developed during our national price control era. Let's hope that neither one reoccurs.

(2) Money. Money seems to be more available, right now, than it has been for years. This applies to both business and personal loans, for both large and small projects. As a result of record savings flowing into S&Ls, it certainly appears that there will be plenty of money available for housing. Furthermore, we can expect stable