The Washington times. [volume] (Washington [D.C.]) 1902-1939, 1908-08-01
PROSPERITY AHEAD
ADAMS PROPHESIES
Stockholders Coming Into
Their Own in Way of
Dividends.
MANAGERS LEARN
WAYS OF ECONOMY
PanicS, Which Appear to Come in
Twenty-Year Cycles, Grow
ing Less Severe.

That period of years is at hand, in
which safe, stable and highly satisfac-
tory dividends will be paid on the shares
OF Industrial and transportation COM
panies. is the confident prediction Of
Prof. Henry C. Adams. for twenty years
in charge of statistics and accounts for
the Interstate Commission.
THE stakeholder is coming into his
own" is the way Prof. Adams, than
whom there is no more careful and
analytical student Of industrial and
financial conditions in America, worded
his prediction He proceeded 10 explain:
This theory of the periodicity of pan
les is rather fascinating one. People
who insist that panics have relation 10
the sun-spots make out a most interest
ing case for their opinion. Other the
cries are likewise well supported. What
ever the fact, II seems pretty well au-
thenticated by long experience, that II
takes about ten years for the business
cycle 10 complete itself. The rule seems
TO be that there is a big, first-class
panic each twenty years, with a disturb
ance Of the same sort but less intensity,
at each intervening ten-year period.
Managers Learning Economy.
1--WE are going through one Of these
depI essions now. II was preceded by a
period OF intense business activity. IN
evitably, during such period, men lose
more or less OF their caution. Every
thing seems prosperous and the future
promising, and there is less care taken
10 watch details Of management and ex-
penditure. So when the depression
comes, and revenues fail away. the
managers cast about for means 10 re-
GuDc expenses They have been finding
out for the larger part OF a year past,
where TO make economies; where they
were permitting part OF their money TO
go into aYOidable expense. They have
been taking in the slack, getting things
on the safe and secure basis. II has
been severe experience, but from the
standpoint Of the shareholder il has
been really good thins.
The depression viii end, and bust
ness will be good again; its volume
In the next cycle, Will be greater than
ever. But the lesson OF this period u
enforced economies Will not be sooa
unlearncd. The increasing revenues
viii be paralleled of against columns
showing reduced expenditures in many
ways. There will be greater care and
economy, with the result that the stock
holder viii have better share coming
10 him"
Uncertain About Type.
Prof. Adams is uncertain about one
aspect Of the present depression. There
is no doubt that we had major crises
in 1879 and 1Ss3.'' he explained. Ten
years after 1893 we were due for a minor
depression. Well, We had one: but K
was rather Sympathetic it didn't
amount TO much If Il was fairly 20 be
set down as the mid-period panic, then
- IA
er. appaI emily; tina. with the setter
organization and greater developed
wealth back Of our Industrial and finan-
Cial structure, il can more securely
stand against this tendency to recur-
rent troubles,
But the depression Of 1854 was Of
Euch slight consequence that 1 am IN
certain whether tC classify the present
of 1907 depression as the belated minor
disturbance which was due in 1905, or
the major disturbance which was due
IN 1913 but got mere ahead Of time. II
IS somehow out of its period a bit. It's
four years late Ton a second-grad4
frst-grade one.
Claimed Panics Were Over.
I'VE all remember few years ago
the captains of industry and finance
were assuring Us that the time for pan
ics was past. They told US that the
balance of supply and demand. Of
wages and capital, and all other factors
going TO make UP the general business
situation had been so perfected, and
the control Of things so far central
lied in strong hands. that that balance
would not again be permitted to be
gravely disturbed. Wise and farseeing
men would anticipate causes. and. ap-
plying prevention and adjusting the fac
tors IN the scale, preserve the balance.
A good many people got TO believing
IT. I was not one Of those who accepted
the doctrine
But there are some circumstances
about the present depression which give
color of justification TO this claim Of
the industrial leaders. II the present
is the belated small panic that ought TO
have come in 1903, It must be conceded
that this new adjustment of forces has
served to postpone IL for four years,
which IS worth while. II on the other
hand the small depression OF 1907
so small as hardly TO be recalled now
was the regular intermediate one. then
its force was certainly greatly reduced.
If, finally, the present depression is the
major one that ought to have come I'm
1913 or thereabOuts. but Is ahead OF
schedule. Il. also. compared with 1898
something new in conditions has taken
much of the force. and destructiveness
out of these major commissions"