The Ypsilanti daily press. (Ypsilanti, Mich.) 1928-1962, 1941-01-01


surely forecast no industry-wide
strikes during 1871. As to the Com
munistic element. the vote on last
November shows this is declin.
ing. Even the most radical know
what has happened already TO la
Dor unions and their leaders IN
every country but the United
States. | believe labor will show
appreciation for its blessings by
being extra fair during 1871.
Farm Income Uncertain
Ordinarily. farm income from
marketing and benefit payments in
1871 should exceed the 1910 figure
OF around 100000 200. but can
not promise this. Weather is a very
unpredictable and important fac
tor Exports will be so severely cut
and such large SURPRISES already eN-
list that | am not too optimistic on
farm prices. Yet. II the cost of the
things which the farmer must buy
is kept down. he should be at least
as well off In 1871 as in 1910. Inter
est rates will be In his favor. and
taxes should not hurt him. There
Will be no new gadgets, such as
automobiles, refrigerators. and
radios. offered to his family during
1871 which he must buy Further.
more. II Germany and Great Britain
begin TO use arsenic next summer
TO kill each others crops. L. :.
farmers may save the situation and
really prosper. considering all
things. | think the farmers cash
income in l94l may exceed 1910
by $3.50, 600 00. or about per cent
despite the reduced exports OF cot
ton wheat. tobacco. and fruits.
All of this means that present
benefits to farmers will continue
throughout 194l at around 100000
600 In addition to the existing rea-
sons for such benefits to continue.
there Is the additional pressure of
South American diplomacy. The
people of South America have only
wheat, cattle. and other agricultur-
al products to sell We must help
them sell them to keep their good
will. This, however, puts real han
dicap on L. S. farmers. If our farm
ers are to accept this burden, IL
surely is up to the rest of us to
help them carry it. Hence, farm
benefits will be more logical in
1871 than ever before.
Foreign Trade Outlook
Foreign trade will be very irreg-
ular during 1871 If allowed to take
its natural course, 1t will slowly but
steadily decline. Every now and
then, however, something gives II
a shot in the arm. Any hypodermic
has a stimulating effect for awhile.
The recent Sl00,000.000 loan TO
China and the talked-of loans TO
South America are illustrations. II
we repeal the Johnson Act. allow.
ing loans to Great Britain. this will
boost foreign trade for awhile
While the summer months and even
September, 1910, showed constant
slumps, October and succeeding
months have shown improvement.
Business And Taxes
Every cloud has silver lining
The need of huge taxes by the gov
eminent insures good business. We
cannot pay taxes without profits,
and we cannot get profits without
good business. But you say: THE
government takes 90 per cent OF the
profits one year. but does not share
the loss another year" This is true
TO a certain extent. Hence, to get
out OF debt and avoid future losses
should be one aim of every business
man in 194l-except those to whom
the government is allowing heavy
plant charge-offs.
When computed on an invested
capital basis the Excess Profits Tax
applies only after per cent is
earned. Have you ever figured what
s per cent will give you when com.
pounded annually? For instance, S.
900 at s per cent compound interest
would amount to over $4,000 i'm 80
years. When you multiply the
amount by 10 or 100, the result is
stupendous. Moreover, il makes lit
tie difference to a conservative in
weston or business man whether
this per cent goes into dividends.
or to plant improvement, or TO debt
reduction. ! once asked Thomas A.
Edison who was the worlds greatest
inventor. He flashed his eyes and
replied; THAT chap who invented
compound interest"
Outlook For Utilities
Although the eastern railroads
should do better during 1871, so
many banks and investors are wait
ing for a chance to unload. do not
foresee much prospect OF a boom
in railroad stocks. As for utility
stocks, the situation is only little
better The increase even in nor.
NAL taxes will hurt the utilities
more than any other group Utilities.
moreover, cannot raise their rates.
at least during 1871. Therefore, the
increase in normal taxes from 20
to "a per cent or more. comes out
of the stockholders This is not the
case In many Industries where the
increase in normal taxes can be alb
sorbed by higher prices OF finished
products. The only hope is that the
increased consumption OF electrl-
city will offset this tax increase or
else that the commissions will be
more lenient as to depreciation.
Bonds, Stocks
High-grade, long-term, low coupon
bonds are today in the same dan.
gerous position as were the blue.
chip stocks in 1929 They can move
in only one way: and that Is down.
May not an investor be crazy 70 tie
up his money at per cent or even
three per cent. for thirty. twenty,
or even ten years? There is iustifi.
cation for an insurance company.
which knows that in 1860 il will
need so much money and can base