The Brattleboro daily reformer. (Brattleboro, Vt.) 1913-1955, 1922-05-15
MONDAY MAY Is, 1922.
WHIT is AHEAD IN BUSINESS?

What is ahead in business? Perhaps
81" question more frequently flashes
across the mind Of man as he struggles
.o make q living; and yet. for the most
ratt. ms fH7re # business is as much
q pszz'e t. him as is the life beyond
dis sphere. 1t is indeed unfortunate
that we do not more often realize that
eo"nomic conditions are governed by laws
as memorable as those which govern the
experiments Of chemistry or the problems
of mathematics.
In the early months of 1920. there was
prosperity in city, village, and country
side. The demand for goods was so
great that it was hardly necessary for
the manufacturer or the jobber to SEND
travelling statesmen on the road. Money
was easily earned and as easily spent.
There was no unemployment. Optimism
everywhere prevailed. In the midst of
these feverish activities men occasionally
naused for a moment to ask, what is
ahead in business?' Almost invariably
came the answer, Continued prosperity.
1t cannot be otherwise. The goods of
Europe are depleted and for years her
people must look to America for the ma
terials of reconstruction The man who
took a different view was proclaimed by
the masses either a fool or a pessimist.
Economic laws, however, cannot be
thwarted. The formula, to every action
there is an equal and opposite reaction,
can be applied as truly to economies as
to mechanics; and depression was bound
to follow. In January, 1920, when bus
mess was at its best, people began to
ask, "What is the matter with Wall
street?" Interest in securities began to
lag. That unfailing Barometer of bust
ness conditions, the stock market. was
fOrecasting to the keen observer the APP
proach of a storm of unusual violence.
He was a wise man who needed that
, forecast, liquidated his business and put
his money into bonds at prices more at
t~ractive than they had been for many
decades. We have seen the havoc
wrought by that storm. Failures, unem-
ployment, encouragement. were left in
it's wake. OF late there has been some
revival in industry and it is timely to
ask, what is ahead in business?"
A study of statistics is helpful in an
swering this question. Economic his
tory shows that periods of prosperity
and depression are factors in every
business cycle and their appearance is
most interesting. Starting with inflated
business conditions, such as were in evil
dence in 1920, we find high money rates.
A high rate Of interest means lower bond
prices. Ineficiency is characteristic of
the times. Inefficiency brings on ndus-
trial depression which is forecasted by
falling stock prices; and the u~nsound
concerns which found the going easy
when confidence prevailed begin to fall
by the wayside. As the real crisis ap-
proaches there is a decline in commodity
prices. There is general unemployment
and pessimism is omnipresent. Finally.
real estate values decline and half the
cycle has been run. Then wages lower !;
there is frugality and greater efficiency.
Money rates are cheaper and bonds in
crease in value. Stocks advance, bust
ness q~uickens, commodity prices move up
and general buying is the, rule. Real es-
tate becomes more valuable. Finally,
there is activity in every field which de-
velops into feYerish and unsound busi-
ness, with conditions like those prevail
ing in 1920. The cycle is complete. An