Perth Amboy evening news., 1923-04-14
VIVISECTING A BOOM TOLD
OF BY HASKIN
Daily Letter by Frederic j. Hsskio

business. He should follow reports
| of production, consumption, prices
and methods. Second, he should in
form himself Of what Is going on in
all other business. It Is pointed out
that the shoe manufacturer might
keep we'll informed on the shoe maxi
ing industry but IL he remained ig-
norant of a slump in steel and coal
which threw thousands out of work,
he would be caught u~npreDared.
All Must Prosper Together
All businesses must be prosperous
together. II the nan in one line
finds another line is having trouble,
1t Is time for him to trim his sails.
The business man also must keep
himself informed concerning the
general credit situation. If the farm
ers, for instance, are having Difficult
ties i'll obtaining credit, his business
ultimately will be adversely affected
even though he is encountering no
present difficulty.
The committee thus urges every
business man to obtain regular in
formation on what is happening in
all businesses, nor does it stop with
the United States. The scope of this
study must include the whole world,
for the markets abroad have a reflex
action on markets here. In fact the
last depression here was precipitated
by the collapse of the silk market in
Japan. Wise business men of that
period who had been studying world
conditions and knew of the Japanese
silk panic. instantly prepared for a
business slump in the United States.
ThA TnLN 3L1k IT, I-=N 49,. a..
fresh in the minds OF business men
and the further fact that they have
been especially urged to keep their
eyes open by the business cycle
committee are the circumstances
which are producing the extraordi-
narily interesting ~vivisection of the
existing boom.
Already it is being noted that
some of the same signs of overex-
pansion that caused the last up
heaval have appeared. One of the
most conspicuous of these signs is
the placing by retailers or jobbers
of duplicate orders with manufac-
turers. A manufacturer who is busy
will not promise early delivery of an
order of goods. This alarms the deal
er who wants to be sure to get his
goods, so he not only places an order
to be delivered as soon as possible
but TO be sure he obtains something
for his store places the same order
with two or three manufacturers.
This creates a fictitious situation and
accelerates the boom. The sequel is
that when the manufacturers finally
lido get around to making the goods
n start delivering the duplicate
orders, the man who placed them
begins canceling. Then the manu-
faoturers have the goods on hand
creating an oversupply. The price
breaks and business depression fol-
, lows.
BY viyisection Of the boom it is
hoped that the business men will
learn to avoid the actions which ag-
gravate these situations.
When the signs of boom appear
they will move cautiously and Le
sure not to overbuy or o~verborroW.
BY such a policy they can avoid a
crash and keep business going on an
even keel. On the other hand, If
there are signs Of depression, that is,
of business inactivity. they can adj
v~ertise and resort to various means
to stimulate business. 1t is estimat-
ed that hundreds of millions Of dol
la. in losses could be avoi ed II the
peaks and depths Of the business
cycle could be smoothed out and this
Is what the vivisection of the present
boom is expected to accomplish.