The Portland daily press., 1900-01-13
ALWAYS THREE PERIODS
In the Ups a.a Downs OF Business
Prosperity, Periedieisy, Reaction.
(Nsw York Tribuns.)

Probably few who read the glowing 40
counts OF the conditions Of business and
industries at the opening Of the nsw year,
wsrs able entirely to escape an imprsssien
that 1t might be too good to last. Rsas-
tion usrally follows extraordinary I'D.
vancss for philosophical reason, in 9TH
or matters a. In stock speculation, be-
cause they produces In conservative min de
hesitation In place Of absolute confidence
When only part OF the progressive and
investing force begins to hold back. Its
progress Is necessarily retarded, ct least
for time.
But just at this point 1t 70 essential to
distinguish b,twesn a retarded rate Of
progress and . disaster. Putting aside
the sudden and violent resotions In spec
ulation which arc often Manufactured
only for the purpose Of enabling those
who are out to get In, there ara natural
laws which prevent immediate and sud-
den disaster after period Of great Inn
provemsnt, unless 1t 10 caused By az
tsrnsi changes as completes ~ the reversal
OF the national policy In 1907
Part OF tbs business world, even then
believed that the changed conditions
would have only limited or temporary
feet. so that the worst results OF the
COLLAPSE In 1923 were not felt until 1891
or 1897. Where reaction comes with ous
suoh exterior cause u always comes grad
ually, with slow decay OF confidence and
exhaustion Of the forces which produced
the great advance.
since business tides depend on human
nature, there ID some philosophy In the
calculation that approximate periodicity
n = he expected In the ebb and the now
e. affairs. Confidence starts mp, what
ever the cause. II grows for some years
until it has enlisted all the progressive
forces OF sosiety, when it necessarily
becomes less rapid; but progress does not
cease at once. because the wosks and I'm.
provemsnts begun at the point Of highest
investing confidence do MOI reach CON-
pietion, and begin production for year
or two.
Also the growth Of purchasing power
following the full employment OF workais
does not cease at onos when ovsrtaksn ly
n growth Of production, and % prices do
not suddenly fall from the highest point
but there 10 first u time Of slow recessien.
usually appearing In only part OF she
prod ucts, which gaina strength and in
cl udss more of them as the new tendsncy
becomes generally realized.
These workings Of human nature. ex-
cept In the presence OF great external
changes Of condition, render the latter
Eating than before, and the beginning OF
reaction gradual. usually sxtsnding
through several years. The downward
turn msy be distinctly traced, even In
the faint commercial records Of early
vssrs, for some time before the panic OF
- .s.I 10 al ~Ixr
marked that there should be no doubt
about 1t from the carly spring Of 1S72 to
the beginning Of November. 1873
SO the recovery from the lowest point
in ~ was slow until May 4, 1879. then
rapid fer nearly two years. and after
ward gradual for another year, until the
spring Of 1882 aft II which gradual reac-
ton can be clearly traced uutll the panic
came In May, 1884
The panic u 1853 was clearly due to
abnormal force', because 10 Was not
preceded by u year or two OF Increasing
III sitaucy and gradual decline after the
highe st prosperity had boon reached in
1892, and for similar political reasons the
recovery did not begin In full force until
the restoration of the n atiopal policy
wss definitely reached In the summer CT
1897.
Theirs have now teen HeNly two yeai
and a half OF advance, slow until the
spring OF 1898, anu cheoked t1sn by the
SrAn'sh war until the fall but wonder
fully rapid through the rest of that yeaI
and the whole year 1893. 1t 10 not In &C.
cord with experience ID expect the oulnai-
nat,on OF the upward movement until
a,tr period of retarded progress nor is
1t In accord with the conclusions war
ranted by st udy Of the underlying causes
in human ratuIe
Only the beginnings OF doubt appear
fret and have Influence with q few while
the gene raj progress siiil continues.
Nor would It be In accord with experience
or the teach ngs Of philosophy to expect
sudden action after the eliminating
point had been reached. A year or two
OF hest incy anu slow decline would tie
needed under ordinary circumstances 10
work out the gradual excess of produo.
t,ou over consumption, the decline OF
employment and Of consuming power
aud the decay of hope and of enterprise
which are ordinarily required to prepare
for disaster.
External events, not normally belong
log to the commercial or industrial field,
IN ght bring reverse at ons time as we'll
as ut any other. But without suoh inter-
position a year or two mora OF business
never surpassed In volume nor In profits
might now be expected, with warrant IN