RETAIL TRADE: On Borrowed Time

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The Federal Reserve Board this week promised the public its first taste in over four years of the old American custom of installment buying. "Regulation W" (wartime consumer credit control) will be relaxed enough to remove all restrictions for the installment purchase of building and home repair materials. If the materials are to be had, the average man can once more build all the new houses or buy all the new bathrooms he can afford, "on time."

But the heady days of a few dollars down and a few cents a month for everything from garages to garbage cans are still a long way off; controls over installment buying in general are due to outlast reconversion. Reason: Regulation W was instituted on Sept. 1, 1941, as an anti-inflationary measure. And FRB fears that inflation would blow prices sky high if unlimited credit is permitted before supply meets the demand.

Nevertheless, lending institutions last week scrambled furiously to get themselves ready for installment buyers when the lid is lifted. The big credit companies led the way by slashing to an alltime low the interest rates to dealers for financing autos. Commercial Credit Co., C.I.T. Financial Corp. and General Motors Acceptance Corp. announced a drop from a prewar 4% to 3%. (The Bank of America National Trust & Savings Assn., in San Francisco, went them one better: 2½%.)

Right in step were 1,000 U.S. banks. They prepared to participate, for the first time, in nationwide time-payment financing. Aiming at the lush household-appliance field, they announced the formation of the National Sales Finance Plan. Purpose: to lend money in at least 3,000 cities and towns for appliances costing as little as $25.