The Wolf Point herald. (Wolf Point, Mont.) 1913-1940, 1924-01-17
STOUT TALKS
OF CALIFORNIA
SAYS LOS ANGELES HAS PASSED
POINT OF SATURATION AND
HAS TOO MANY PEOPLE
Banks Are Making No More Loans on
Real Estate; Many Who Have
Gone There to Locate Will Return
to Their Homes.

The Los Angeles area of Califor-
MIA has passed the point of satura-
ton, in the sense in which that
term applies to population. This
winter, many thousands of persons
are located there who have no
prospect of sustaining themselves
permanently by means of employ
ment or by consistently engaging
in business or placing investments,
with the result hat there inevita-
bly, will be a compulsory exodus
when true values are determined.
That is the observation of Tom
Stout, editor of the Lewistown Demo-
crat-News, who has just returned
from California.
Nobody who has been in Califor-
nia-and that includes a good num-
Der of Montana people-would want
to detract from that states wonder
full advantages" said Mr.. Stout, "but
to the unbiased observer it seem
very certain that California, espe-
cially the Los Angeles area, has been
overdone. This portion of Califor-
mia is a huge, versatile, virile terri
tory, one that in any event would go
forward under its own momentum,
but in my opinion the population has
become greater during the last few
years than can be normally absorbed.
There is ample evidence that this is
true, even when to the sustaining
power of the areas production is
added the outside capital that has
been taken there in very large
amounts.
Realty Values Inflated
"Real estate values have been in
flated to a point that bears little
more than a remote relationship to
normal. The housing of the surplus
population and the hustle and hustle
and confusion that always attends a
boom period had created a situation
that would seem to me as involving
a large element of hazard. The OBJ
servers conclusion in that regard is
significantly confirmed, it seems to
me, by the indication that California
business men are beginning to realize
that there must be taken into con-
sideration the fact that there is a
safety limit that cannot be ignored.
1.-THE trend of thought among bust
ness men in Los Angeles is apparent
in a policy that now is in effect with
the banks. Through an agreement
entered into by banking houses of
that city, 10 real estate loans have
been made by concerns of this kind
since November 1. The agreement
was entered into for a period of go
days, which would make it expire
February /, but there is strong in
dication that after that date it will
be continued indefinitely.
1.-THE situation confronting Los An
geles bankers can in a measure be
analysed by an instance 1 personally
was familiar with. A former Mon
tana man now in California paid
$3.50 for his residence and only re-
Gently was offered a loan Of $4,000
on this property. 1t is not
able to think that the value in this
instance has been tremendously in
flated by the boom, and the reason
for the action taken by the Los An
geles banks is rather apparent when
1t is remembered that there undoubt-
eddy are thousands of parallel cases.
Many Families Leave
There seems to be ample proof
that many of the new arrivals in the
Los Angeles area are themselves be-
ginning to realize that the satura-
ton point has been passed. l OBJ
tanned no statistics but large num-