Imperial Valley press., 1938-08-22


a waiting period. The end Of
the summer is traditionally slack.
However, when we put Labor Day
behind us watch the smoke! This
Fall should see one of the most
spectacular business upsurges on
record.
Yet, in the face of the vigorous
jump we have already had, rs per
cent Of the people with whom I
talk are still groaning about the
recession. They say they are sit
ting tight to see whether this is
"just flash in the pan or a genu-
inc recovery. Not until prices are
skyhigh, orders rushing in, and
raw materials and good workers
scarce will they finally become op-
timistic.
Hot Dogs and : Ication
The situation reminds me of the
story my friend George Trundle,
jr. tells. 1t is about a man who
lived by the side of the road and
sold hot dogs. Here it is in his
own words:
''The hot-dog man was hard of
hearing, so he had no radio. He
had trouble with his eyes, so he
read no newspapers. But he sold
GOOD hot dogs. He put up adver-
tising signs. He stood by the side
of the road and cried, BUY a hot
dog, mister?' And people bought.
He had to increase his meat and
bun order. He had to buy a bigger
stove to take care of his trade.
He finally got his son home from
college to help him.
But then something happened.
His son said, Father, haven't you
been listening to the radio? Have
MT you been reading the news
papers? There's a big depression
on. The European situation is ter
rible. The domestic situation is
worse. Everything's going to pot.
Whereupon the father thought,
Well my sons been to college, he
reads the papers and he listens to
the radio, and he ought to know.
so the father cut down on his
meat and bun orders, began to talk
depression, took down his adver-
tising signs, and no longer bother
ed to stand out on the highway
to sell his hot dogs. And his hot
dog sales fell off almost overnight.
You're right, son, the father said
to his boy. We certainly ARE in
the middle of a great depression "
Ups And Downs Sharper
This little story not only illus
trates the point about todays pes
simists, but it also has a deeper
moral. For 35 years 1 have been
studying business statistics. I have
a big Babson chart hanging on the
wall which covers all those years
Whenever I look at this business
chart, l am amazed by the violent
changes in the line which pictures
the good and bad times of business
This curve" has gone up and down
more in the last ten years than in
the three previous decades!
This fact is especially disap-
pointing to me. When 1 started on
my career of gathering data about
business, I had typical young
sterS idea that l was embarking
on a crusade-a crusade to help
educate people about the business
cycle. With such education l be-
lieved that the "curve" would
smooth out. 1 thought the peaks
would gradually become lower and
the valley shallower. But the op-
poSlte has happened. The zig-zags
are now more pointed and come
more often than ever before.
News More Sensational
What are the reasons? There
are many. believe that the ma
Jor ones, however, are the greater
public interest in the business cy-
Gle and the new role government
Is playing in business. The cher
rished hope of my early days (that
the more knowledge the public had
OF the business cycle the less severe
the cycle would be- has worked in
reverse. What happens is that
people try ito beat the cycle. Bus
mess news now gets far more at
tention than it ever did. Further
more, such news is handled much
more sensationally - especially by
radio commentators. The result is
that business today is ruled by
emotions rather than by statistics.
Here is how it works. Some
morning the public wakes up to
the fact that the business outlook
temporarily is uncertain. Activity
slackS off and securities are quiet
ly sold. News of this uncertainty
begins to appear. People are fear
ful that they are on the brink of
a depression. Suddenly the crou,d