ECONOMIC RALLY REMAINS ON HOLD

This is a year that economists have much to be modest about. They have repeatedly promised a business pickup - an economic rally that has yet to come. If it does come, it will remove some tarnish from their repute as forecasters. But it had better come soon. Better late than never!

Seven successive months of dispirited economic growth have become worrisome: What's holding up the pickup? The latest survey of the National Federal of Independent Business is not encouraging. The NFIB comprises a cross section of 500,000 small businesses. The optimism and plans of members to expand have contracted noticeably in recent months . Oomph is lacking.However, economists regard the January-July economic doldrums as a forerunner of long-lived expansion through this year and next. They're a bit less optimistic than in January, but few foresee a recession.

And why shouldn't they hold fast to optimism? Didn't Federal Reserve Board Chairman Paul A. Volcker say reassuringly to the House Banking Committee, "I think the signals, the harbingers, that one normally associates with a near- term recession are generally absent, but we live in a much more complex world than even a few years ago"?

Economists have construed favorably news that skeptics could construe unfavorably. Here are three examples:

One: Lower oil prices. They are equivalent to a tax cut. They lower costs of users of heating fuel and gasoline and thus increase the spending power of consumers and business firms.

Two: Lower interest rates. They'll stimulate the economy. Business firms will be able to borrow more cheaply. This will increase profit margins and encourage expansion. People who are debtors also will be beneficiaries. So an interest rate cut can also be likened to a tax cut. It, too, buoys spending.

Three: The lower-priced dollar will enable U.S. exporters to cut the prices of products they sell in foreign markets and will force foreign enterprises that sell goods in the United States to raise their prices. Thus it will improve the competitiveness and sales of U.S. companies both in their home market and abroad.

The three economic "lowers" became one big glorious economic "upper", and they fostered the long bull market in Wall Street - the rise in the Dow Jones industrials above 1,900. Yes, the July break in stock prices shook confidence a bit, but the trip of Mr. Volcker to West Germany was a restorative.

Ostensibly, Mr. Volcker went to the funeral service for Otmar Emminger, a former head of the German Bundesbank. But he wasn't idle. He met the present Bundesbank head, Karl Otto Pohl. Wall Streeters concluded that he had persuaded German officials to reduce interest rates so as to stimulate German economic growth and assist the United States in reducing interest rates here.

Expansion in Germany would have desirable worldwide repercussions. Germans would increase consumption and buy more from the United States and other nations. Furthermore, Japan too would lower interest rates, and the burden of debt everywhere would be lessened. This would help over-indebted nations. Sales everywhere would increase. As a result, U.S. stock prices shot up.

The three "lowers" that made an "upper" for economists have bearish aspects. True, the drop in oil prices bullishly entered econometrician's computers as a "tax cut," but the losses that were subsequently suffered by oil companies and banks escaped measurement. An oil glut was mistakenly treated as a gloat.

The drop in interest rates similarly has a negative aspect. If business were robust, loan demand would increase and interest rates would rise. Thus, the interest rates cuts were the Federal Reserve's response to political and Wall Street exhortation to do something - don't stand aloof from the doldrums.

The drop in the price of the dollar also is not an unmitigated plus. It raises the prices of foreign automobiles, clothing, and other imported products. Thus, living expenses in the United States go up.

But all misgivings wash away when economists look beyond the current ''growth recession." It has been assumed that U.S. efforts to obtain German and Japanese collaboration on lower interest rates would succeed and provide a worldwide economic lift.

Lower interest rates are a powerful propulsive economic force. Not only do they alleviate the debt costs of over-indebted less-developed nations, but they encourage economic growth. Hence Wall Street's exultant response to Mr. Volcker's German visit. Mr. Volcker wants an economic pickup, and what Mr. Volcker wants, he often gets. So, Mr. Volcker may be the savior of economists.

Still, this can be written: 1986 isn't a year that economists can be proud of. The pickup, when and if it comes, will have been disappointingly slow.

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