Evening star. [volume] (Washington, D.C.) 1854-1972, 1926-01-02
BABSON THINKS OUTLOOK BRIGHT
FOR FIRST HALF OF NEW YEAR
Commodity Prices May Rise-Urges Caution in Buy.
ing Stocks-Expects Bonds to Hold Steady.
Looks for Higher Money.

witnessed generally increasing indus
trial activity. and as the year drew
to q close this resulted In q dimin.
ished supply of available labor. The
ranks of the unemployed have been
steadily thinned since September.
This heightened employment should
continue we'll through the first half
of the year, although there is little
reason to expect an excessive demand
for labor and a fairly amply supply
promises to be available In nearly
every industry. In 1925 my records
show fewer strikes than during any
year since 1914. The present upward
movement of general business may
bring In its train some increase Of
strikes.
The first half Of 1926 will doubtless
see a growing number of Industrial
disputes. This applies particularly
10 those industries In which wage
agreements come up for renewal dur.
! ing the months Of April. May and
| 'r,e do not expect. however. that
q : of these disputes will prove
seriously disturbing to business. With
the REIMBURSEMENT Of wage agreements,
at the middle of the year. strikes may
taper off again and decrease In mum.
Der and Importance during the latter
half OF 1896.
Wage Trend Downward.
The record of wage increases and
wage reductions now shows d pre-
pondcranCe % cuts over wage in
cre1ses. For comparable periods dur
ing the prsl three years the records
run as follows: II 1928, ,432 wage
Increases and Is wage cuts; in 1924,
49, increases and Ut cuts; in 1925.
~. II
I9"5, then. closed with n somewha I
downward wage trend in progress,
and this may last into the first half
OF 1925. probably becoming less
marked in the latter part of 1926.
Observe. however. that the wage
trend is a gauge Of real purcha sing
power only when viewed in conpari-
son with a corresponding trend in
the cost OF living In spite of de.
cliring tendencies In wages, the pur-
cha sinE power OF labor may be fairly
Well sustained in 1926. provided living
costs remain at Il reasonable level.
Industrial Prospects Good.
Industrial activity generally is on
the increase. When seasonal move
ments are disreEarded and attention
is focused on the underlying trend,
many industries had an upward swing
in 1925, and are entering 1926 with
considerable momentum
Among such industries might be
ne" ned. together with their asso-
ciat lines, iron and steel, auto
moh..es, railroad equipment, some
branches of the textile industries, and
various electrical lines.
There should be a more even 6istri.
button of industrial activity in 1925
than we have had FOR some time.
Sales Should Improve.
In most territories sales should con-
tinue TO improve. Starting with the
low point of the 1921 depression the
manufacturing centers We're the first
70 recover from this slump and rise to
normal. In 1922, 1923 and 1924 the
farm regions were VIGOROUSLY tagging
behind the rest OF the country in
sales opportunities. During 1925 this
dislocation OF the farming regions was
largely corrected. and there is nov
fairly good balance between the MAJ.
featuring cities and the agriculture,
areas.
With general business now swinging
up through its normal line and point.
ing toward prosperity, II is a most in
terestiag question whether or not the
manufacturing cities will take the
lead in the advance into prosperity
just as they took the lead in rallying
from depression.
During 1925 more attention was
directed 70 the advantages OF the
South than ever before. Florida be
came the scene OF extraordinary &C
tivity. but, In broader sense, people
walked up to the immense possibilities
throughout the whole Southeast and
Southwest. One thing in particular
| desire TO emphasize, namely, the re
markable growth OF the South. AT
the risk of repetition. | again urge
readers to watch the wonderful devel
opment that Is sure 10 continue