The influential U.S. magazine Fortune did a survey of business prospects in the United States in its May issue, It concluded that there was a very real possibility of a recession in the year ahead. Fortune ases its assessments on three major developments within the economy (it should be noted that its opinion is not shared either by most U.S. big business executives or the Administration) Firstly that although Americans apparently made full use of the tax reductions last January to raise their expenditures to abnormally high levels, during the first quarter sales from some retail outlets have not been as buoyant as hoped. Clothing retailers in some areas found early Easter sales below expectations, while sales of new cars declined for the second month running in April, hitting an 8.3million annual rate, compared with 9.6million in January and February.
Secondly, Fortune expresses concern that while "an important part of the economic advance of the past four years has been based on the growth of credit," there are now indications that borrowing ater reaching a rate of nearly $80,000million in the last quarter will slow to around $67,000 million, Thirdly, Fortune points out that business investments in stocks had “exploded" since early last year, to a current - annual rate of $8,000 million, and it suggests that "the rate will soon have to come at least halfway down,"