The Washington times., 1932-05-16

GILBERT sELDEs clear expression. In them, and in
interviews with fnancers, and in reports, have
discovered that certain facts which of the highest
Importance, not openly stated the moment they are
known; they filter into the general stream of Ideas
Perhaps the specialists all know them; per-
haps the others think it as we'll they should not be
known. Such fact was the shrinkage of production
in the United States six months before the Wall Street
panic It is important because it signifies the coming
of the depression before stocks broke to pieces Another
example, little complicated, had to do with the
juggling of international loans before England Went of
the gold standard.
Change in Tone
In recent months the whole contour of talk about
the depression has changed. From the levels OF en-
ployment and industry have moved to the of
deflaton and money Most economists, believe &C
cept Saters analysis, that the industrial depression
might have mended if it had not met financial tor
nado midway, about eighteen months ago. We have all
had to pick up idea here or there about gold
Rich vs. Rich
In this light hint dropped now and again be-
gins to have importance. It is not that the rich
against the poor but that the rich in strange
way, against themselves Take the of man with
millions in Government bonds, millions in industrial
bonds, and millions invested in businesses Some of
that money is at war with the rest of it. The income
he gets from Liberty bonds is worth more today than
it year ago and will be worth more as deflation
continues it will be worth less if initiation comes IN
On the other hand, he stands better chance Of max
ing money with initiation, his business will prosper,
he will have chance of profits.
On the Side
Take the case of salaried who has little
for magazines His salary has been cut, yet it is worth
to him today than eighteen months ago, because
prices have gone down. (Inflaton help him only
if it attacks his permanent obligations the mortgage
his house, the premium his insurance, etc.,. He
wants to keep his salary worth as much as possble
yet it will take initiation to make his subscription bust
ness prosper again.
Dead and Alive
Dead money is opposed to live money. If there
existed in America vast RENTER class, such as is
known in Europe, class of people who do little
work and live income, they would be at war with
every shOpkeeper and every manufacturer At the
moment this is only partly true; the class lines
complicated that, have suggested, sometimes the
same individual is on both sides at
Naturally those who have all their fortune in bonds
which still pay their interest do not want initiation. To
them, general prosperity through initiation means cut
in actual buying power. asked able economist the
other day. how these people to be persuaded and
: his answer was both encouraging and illuminating
He said that dead money has ceased to be SAFE Some
time last September, he felt, the moment when
initiation had to n that income itself might not
be jeopardized When the master issues railroads and
certain indusrals, begin to skip payments preferred
stocks when bonds to be absolutely sterling when
the proportion of nonpaymens rises, the danger line
has been reached Then the far-sghted who have
income from bonds are willing to take diminished re-
turn that their other investments will prosper and
make up the difference
Bond or Bonus
of the economic wrongness of this analysis
but my friends who have studied the subject
that there is division of purpose between those
whose money is working in way and those whose
money is working in another The economist alluded
to above has become mild inflationist; he objects
to the payment of bonuses but it may be the best
way to initiate. He in favor of bond issue of sew
eral billions for public works and enthusiast for
spending billions housing. And he says that if we
continue to debate heading toward the abyss;
but if we initiate properly, may break the back of
the depression in year.
There's optimism for you.