Evening star., 1922-05-13
Growth Reflected in Real Estate and Building News

Surely the sale of cofins can be in
creased very little by advertising,
salesmanship or any other means
known to the most clever sales man.
Take salt" continued Mr.. Babson,
salt 10 the prime essential of food,
yet the cleverest advertising In the
world could not increase the natural
consumption Of salt Although offhand
you might think 1t much,safer to loan
money to the salt industry than to
the candy industry. yet q study or
failure records shows that the candy
industry IL safer than the salt in
dustry.
although musical instruments are
not essential, the demand for them
can be increased to an almost unlim-
tied extent. Hence industries pro-
ducing products Of the second group
are preferable to those OF the first
group.
Industries Most Profitable.
'The third group. including those
industries based upon repeating pur-
chases, IL the most profitable of ALL
The securities Of the Gillette razor
are a very good illustration: The
Gillette company can anord to sell
a rasor at a loss because OF the blades
: Another Illustration is tho Eastman
Kodak Company. Eastman can well
afford to sell q kodak at cost because
Of the great source of income In films
and supplies. Another illustration Is
the phonograph- A plano would go In
group 2. a phonograph would also
60 In group 2. but phonograph rec
ords would go in group 3. The
Victor company has made It's great
est profits on the records rather than
on the phonographs: This fact is very
interesting when looking over the
stock market, because you will see
that the most profitable stocks are
those Of companies like Gillette, Ko-
dak and Victor. all Of which come
under this third group.
Investors should not be frightened
at the word industrials. Every class
Of securities has its strong features
and its weak features. No class of
Investments has a monopoly of all
the good points. The wise investor
will diversity, taking part govern
ments and municipals, part railroads,
part industrials. part public utilities,
part other classes: When. however.
those industries that are based upon
repeat orders and where the market
is more or less unlimited.
Bank on Monopoly.
Some people bank on monopoly.
They will buy only into industries
which have monpolies. Temporarily
they may win. but the fact of the
company's having a monopoly usually
tends to make the company inefficient
and often ultimately brings disaster.
Tho investor who depends on mo-
nopoly Is playing a dangerous game.
1t fs far, better to buy into an in
dustry which has a great undeveloped
held and which relies on repeat
orders.
II certainly advise investors against
putting their money into companies
which manufacture products which
do people harm. Statistics show that
the greatest losses to investors in in
dustrials have come through compa-
nies such as brewery companies. for
instance. They have been operated
purely for profit without regard to
the welfare o. the people. The
primary feature to be sought when n
conside ering an investment" concfud-
ed Mr.. Babson. '1s to be certain that
your money is to make people
healthier. happier. and more pros
porous. When you invest your money,
II you will try to select such COM
panies, and at the same time COM
panies proflting on repeat business,
you will make the greatest profits
with the least risk" .....
General business has maintained
the gain made a week ago, according
to the index of the Babson chart. and
is running at Is per cent below
normal.