Evening star., 1923-06-09
Roger Babson Great Believer
In Very Extensive Advertising
StabHises Business, He Asserts.-CaIIs Size
/: of Daily Papers Business Barometer.
In Glass With Banking.

in any other form. Advertising.
when properly used. is considerably
cheaper than selling through sales
men and clerks. Not only is the
through the newspapers or the mails
the maker knows just what he prom
ises The firm, however, which depends
upon a crew of statesmen does not al
ways know what the statesmen pIpm-
Use. There are many other economic
advantages gained through the in
telligent use Of constructive adver-
tising
Finally we shall have what like
to call ultimate advertising. The
history of the advertising agent will
be similar to the history of the
banker. Banking, as you know.
started with the pawn shop. The
loaning of money in it's early stages
was looked upon as a most illegiti-
mate business and carried on under
cover by questionable people. Usury
was not only banned by the church, but
by legislation. 1t was only compare
lively fewsyears ago, considering his
tory as a whole, when banking was
recognized as a legitimate business.
Present Banking Methods.
During the past hundred years
banking has gone through various
stages. The first campaign was to
next step was to eliminate competi-
tive banking; and the present genera
tion has been engaged In constructive
banking. The country is now learn
ing, however, that the banker has a
great opportunity in steadyinG busi-
ness conditions, thereby elimina tin 6
reckless booms and preventing need
less panics. 1t has been learned that
by increasing the bank rate durin~
Arin of Si a.,
can be prevented. Then by lowering
the rate during periods of depression.
prosperity can be brought back. 1t
has been learned that the bank rate
bears the same relation to business
that the governor bears to an engine.
Hence, the banks have been recently
united in the federal reserve system.
which can control the discount rate
with the sole object of eliminating
reckless booms and preventing need
less panics.
If however, you will talk with
any bank man. thoroughly informed
in economics. he will tell you that the
goal cannot be reached except with
the help of the advertising man OF
the country and the transportation
systems. The three creates factors
affecting business are money rates,
advertising rates and transportation
rates. Given control of these three
factors one can go a long way in
eliminating the. hills and valleys of
business. The federal reserve board
is doing as we'll as it can with only
one of these tools. but at present it
is like a carpenter with only a ham
mer, and without a saw or chisel.
The Interstate Commerce. Commits
sion, which controls the rates of
transportation, has the saw; but
the advertising men have the chisel.
Some day your Associated Advertising
Clubs of the World will take up the
question of using advertising rates
as tool in connection with the
steadying of business conditions.
Papers Show Prosperity.
when business is recklessly ex-
panding. advertising rates should be
materially increased. SO that when
business Is depressed advertising
rates may be correspondingly re-
duced. One. of the best barometers
of business is the size, of our daily
papers. I do not want to reduce the
size of our papers over a period of
years. Rather l want TO see them