The Ypsilanti daily press. (Ypsilanti, Mich.) 1928-1962, 1941-09-26
BY Roger W. eabson

La Guardia Field, New York. Sep
TENDER 26-Readers ask me, why
do not the stocks Of the airplane
companies, which have such ire
mendous backlogs OF untitled prof
table orders, sell at higher prices ~
Well, If you would like my frank
answer and will not hold me or this
newspaper responsible, here 1t is:
-- Tremendous
Closely approaching the tabled
reproductive capacity Of the house
fly production of United States air
craft has zoomed skyward in recent
months. From a dollar value below
fifty million annually six years ago,
it is estimated that 1941 aircraft
production will set high mark not
far from two billion dollars.
/ II Is only natural that such
growth has attracted a flock Of
admirers from the investment pub
lie. There has been so much talk
about the expanding market for
these war birds that investors and
spectators. who do not know a
prop from tail fin. are buying.
these aviation securities.
Permanent or Temporary
Public interest is directed espe-
cially toward the manufacturing end
of the aviation industry. The big
figures refer to the production of
airplanes and engines. These. OF
course, are the things which 90 to
build military battle force. They
are the immediate and visible re-
suits OF war Of movement.
Those who are rushing to buy the
securities OF airplane manufacturing
| companies should focus their minds
on the important fact that these
companies are experiencing a tenn
porary spree The temporary nature
OF this spree should not be over
estimated by anyone who takes his
investment problems seriously.
When VIII The War End?
II is true that production OF air
craft and engines will probably not
reach a peak until July, 1912. o.
early 1913. is true that these
companies are priority-proof and
the Government is giving them
every consideration including great
depreciation allowances. Every ef-
fort will be made by the Govern
ment to quickly settle their labor
| disputes. Yet, all these favorable
factors cannot black out the tenn
porary nature OF the aviation boom
In any consideration OF the future.
we should assume certain things:
0) War rs not the ordinary pursuit
OF man. The present war may come
TO an end sooner than most people
think possibly In the winter of
1929. ~ We must be so bold
as 10 assume that England and her
allies will win the war. (3) a large
airforce will be maintained after
the war in order to assure a keeping
OF the peace. but IL will be much
smaller than that which is current
y being amassed.
Earnings In 1874?
Therefore. ! say. Watch out for
a topping of OF earnings OF manu-.
featuring companies during the year
1912" I do not deny that they are
III Nht NlDfF NbNt buN WHERE VIII
they be after the war? At the best.
there will be period OF readjust-
ment after the armistice. At the
worst many congratulations and
consultations viii be necessary in
order to adjust production to a
new peacetime basis. Thus, although
company may earn s. this year
and 81 next year. what Will this
company be worth II Il Is able to
earn only 81 In 194i7
This leads to the conclusion that
investing In the manufacturing
companies can be- al best. only 2
temporary speculation n Is true
thai much money may be made In