State of Business: Beating the Cost Bulge

On Wall Street, the Berlin boom was on. Rushing to buy common stocks, partly as a hedge against inflation, investors early in the week drove the Dow-Jones industrial average to a record 713.94 (previous record: 705.96 in May). The averages were jolted back next day by an inadvertent Antitrust Division haymaker at giant American Telephone & Telegraph Co. (see Personal File), but the momentum was too great: by week's end the market had moved on to still another new high of 720.69.

Not all the market's new ebullience was crisis-inspired. As encouraging to investors as the impact of increased defense spending...

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