The Ontario Argus. (Ontario, Or.) 1???-1947, 1922-10-12
BUSINESS INITIATION IS
TEMPORARY SAYS BADSON

Wellesley, Hills, Mass. Oct. z,
1922. Discussing the statement of
certain bankers that the country is
headed for another period of infla-
tion, Roger w. Babson today is
sued the following statement from
his statistical offices at Wellesley
Hills:
For readers who are not bankers
ana economists, let me first explain
is a simple language what is meant
by initiation. Men who are ac-
quainted with the Babsonchart of
Business Conditions know it is made
up of two lines-first a normal line
representing the permanent growth
OF the country which looks like a
simple uphill grade and a second
line which looks like the outline of
hills and valleys. This second line
represents temporary business con-
ditions. For few years it is above
the normal line. When the two
lines coincide, business is normal,
but when the second line is above
the normal line, bankers say we are
having initiation, while when this
line is below the normal line, bank
ers say we are having deflation.
Just now they say we are threat
ened with another period of infla-
ton.
"The normal line of business Is
determined by the honesty intel
ligence industry, and thrift of the
people. Comparing the health of
business with the health of per-
son, we would say that the normal
growth depends upon how we be-
have and how we take care of our
selves. The temporary business
line, however, is affected by stim-
uli the same as our body. A stim-
ulant may greatly exhilarate us
but we know the effect is only tenn
porary and the reaction afterwards
is very depressing-we feel much
worse in few days. This is the
scientific explanation of the COM
mon saying, I feel like the morning
after There are several reasons
why the bankers may be right in
saying that a temporary period of
initiation is at hand. The country
during the past year has been given
three distinct stimulants, which
should artificially help business and
thereby cause initiation.
'The first of these stimulants
was the immigration Law passed
year ago and which was recently re-
enacted. This is known as the
per cent Law, which limits the emil
grafton from any country in one
year to three per cent of the people
now here from that country. 1t is
practically a tariff on manual labor.
If continued it will cause famine
of common labor in this country. It
is the reason why the United States
Steel Corporation and other con-
Germs are increasing the wages of
common labor. II this law con-
tinues very much longer it will
cause an initiation in the wages of
common labor and thereby tend to
bring about general initiation.
"The Tariff Bill, which was passed
last month, is second cause of in
flation. Whether or not such a |
tariff is good for the country is q
political question and is not for me
to discuss, but all students are
agreed that 1t is largely a tempo
rary stimulant. The tariff helps !
the manufacturer the same as the |
immigration Law increases produc- !
tion or makes two blades of grass |
grow where only one grew before, |
The tariff will cause an increase in |
the price of goods the same as the |
immigration Law will cause an in |
crease in wages Increasing prices |
and increasing wages, however do |
not make the country any richer.
The country becomes richer only as |
1t has more houses, more bushels, |
more tons, and more yards Of goods.
Marking up the price of goods ac-I
complishes nothing. With about
thousand dollars you can today buy |
million German marks and be-
come millionaire, but you are no
richer than before.
1.-THE third event that will bring
on the initiation, happened last week
when England gave in to Turkey.
England has been the one great
country outside of America which
payment of debts and sound cur
rency. The lack of France and