The Waterbury Democrat., 1933-10-25

by Harold Stonier, director oI thc American Institute of BanKing' New York, before the fourteenth annual convention of the First DIS trict, Advertising Federation or America. Hotel Bancroft, yesterday afternoon.
 No more difficult task confronts modern business management than inc proper use of advertising during ia husiness crisis. It Is now gener- ally recognized that advertising used at the proper time and under fhe right conditions can be very powerful force in developing busi- ness enterprise. On the other hanu, ae advertising is not properly used for used at the wrong time, 1t can very easily defeat it's nurpose.
 a Organized Advertising
 E have had occasion to observe the work of the Advertising Fed- .erntion of America for fifteen years and I have been impressed with the fact that it has always stood TOT truth in advertising. Long belore the government thought of the idea of fair practice codes. orsanizea advertising had formulated prlnci- ples of fair practice, and 1t had es- ,tnblished better business bureaus and other agencies to carry out the .principles Of fair competition. The organized advertising movement has for years been an educational 'nctivity--the idea in mind being the spreading of information about advertising. l believe that business .orga nizations and | w D apers should continue to support the ssvork of organized advertising us sthe most effective means of lnsuf- Ing the use of fair practices In the field of business.
 Advertising and Credit.
 \ Advertising and credit have much fin common. They are both intang- Able forces. They exist as effective weapons in a depression only when certain other factors exist. Ad- eyertising cannot be successful if there is fear or lack of confidence existing on the part of the general ypublic. Neither can credit do its work under similar conditions. when the buyer and the seller have Ia proper relationship and when leach feels that the other can per- form the acts and services he claims to, be able to perform, only then does confidence exist. When this kind of confidence Is established. rbusiness men may go to banks and secure credit through which busi :. ness confidence can be translated into profit to both the buyer and ,the seller. But until confidence Is ;established. credit cannot exist. iCrpdit cannot be manufactured and sba successful; neither can advertis- inx. Advertising cannot exist in an atmosphere of suspicion or rumor of hysteria and do It's best work. 1t is only when there is chance for confidence and fair practice that advertising can be effective.
 Advertising As Pioneer.
 Advertising of necessity Is a Aploneering activity. We cannot con- strcl all the factors in the picture Ito such an extent that we can as sure the absolute success of an ad- svertising undertaking. Advertising must take the risks of the pioneer; 1t Is also entitled to reap the re- wards.
 Tempo of ga.
 We are living in u very inter- lesting and hectic time. The mass spsychology of the people of this Country changes very rapidly. In 1880 our mass psychology was one of false optimism. We thought we could laugh the depression away.
 Our psychology rapidly changed fin, 1881 to pessimism and cyncism s'Oh yeah" became the byword of s1931. In 1882 we saw change again in the mass psychology of the people. People were attempt ing to look the situation in the face. They could not laugh 1t away and they could not cry it away. They faw that 1t was real. and the tempo % .,I Yealism. The temhpo Of the mind Or 1882 was, that Of realism. The fempo of i933' is geared to action. This fig a year of tremendous ac- tivity of experimentation of trying things. [ believe that advertising has more chance Of success this gear than at any other time dur ing the period of the business cris- ;ia. People want action. Advertise ing can give it to them. It can dl- rect their thinking. It can stir them to means of activity. The Government is depending on ad- 4vertising in way that has not been witnessed since the Grat war.
 Speculation and Gambling
 Tn a period of boom the Amer tcan people are great spectators. Jn . period of depression they will inot assume the necessary risks N hich lead toward recovery. Dur ing every depression the seeds are gown which lead Go recovery. sim ply because during q depression people refuse to buy. to rebuild. to Sreplace and in SO doing they store i,D an ultimate demand which soon 'er or later dawns during every pe- trlod or depression. The recovery starts.
 People confuse speculation with fambling in period of depression. We must assume risks in a dynamic .econolnIc society or 1t cannot e%isI and progress. America has made It's great progress In the past sim ply because its people were willing to assume risks.
 q The assumption of necessary