Montgomery County sentinel. [volume] (Rockville, Md.) 1855-1974, 1942-01-08
BABSON'S FORECAST
FOR 1912
Continued from Page u

ESdCHSu us peak anu Will UcSAh
to slump off in 1912.
Ordinarily this should result
in increased rents and an in
creased demand for houses al
ready built. 1t must be remem-
bered, however, that where third
of the workers will have more
wages and want to move into bet
ter houses, two-thirds of the work.
ers will have no wage increases.
Many will have wage decreases.
Some will see their expenses SO in
creased that they will be looking
for cheaper homes as well as for
cheaper cars. Readers who have
real estate which they would like
to sell should make a strong eff
fort to sell it during 1942-at least
sell enough to get out of debt.
WHAT ABOUT RETAIL TRADE?
Merchants in the defense areas
should have a good year. ! am not
Sc hopeful for those outside defense
areas. Certainly, the number of
sales will be smaller although the
total gross may hold up. Expand
ing the draft age may have a
dampening effect on retail trade
later in the year. The new draft
call may also cut the labor sup
ply of many industries. Blackouts
are another factor in retarding
consumer buying. Hence, mer-
chants should increase advertising
appropriations if they expect a
good year in 1912. I advise mer-
chants to keep down expenses;
avoid wage increases; and get out
& CT debt. If someone else offers your
employees more money than you are
now paying, let him have such. At
ter the war they will come back to
you glad to work for less money
than you are now paying. Don't
speculate in merchandise. Keep
we'll stocked on standard goods,
but avoid style goods which are
hard to carry over. Initiation is
with us and is gradually increas-
ing prices at the rate of from To-
1870 a year. Legislation can check
it, but it can no more stop in
fiation than can legislation stop
crime. Remember that when the
war stops, it will stop suddenly.
Therefore, merchants should keep
close to shore.
RESIDENTIAL BUILDING WILL
DECLINE
Residential building during 1941
increased, as a year ago l forecast
ed it would increase. Hence, ! do
not like to risk my good reputation
row in giving a figure for 1912. I
believe, however, that rising costs,
scarcity of certain materials and
the provoking way in which labor
has acted is hurting residential
building. Surely it will show no
increase in 1912 over 1941; while /
should not be surprised if it fell
back to 1910 figures possibly to
the extent of 1879 to 1879. Public
works and highway Construction
will be less in 1912 than in 1941.
The building of industrial plants
will continue in good volume dur
ing the first six months. Pleasure
car production will be cut 500.
General export trade, except for
war purposes, will also fall off.
This will especially be true in the
Pacific due to Japan's attack upon
us. Remember that - as rule
the curves for residential building,
auto production, and non-defense
foreign trade generally go in the
same downward direction.
UTILITIES SHOULD IMPROVE
The utility industry is basically
sound. With few exceptions when
high-finance crept in, the utilities
have been conservatively and eff
GENTLY managed. They have been
foremost in reducing the cost and
improving the quality of their SER
vice. Yet for some unknown rea-
sons the utilities have been perse-
cuted, taxed, sandbagged, ara
strangled as never has any legiti /.
mate industry before. When a
financial history of the goth GER
fury is written this unjust and I'M
necessary abuse - climaxed with
the SEC "death clause''-will be it,
big black spot. What of the fu-
ture? They will continue to grow
and improve their service. All the
bonds and stocks of the operating
companies should be good invest
ments. The bonds and preferred
stocks of the holding companies
should sell during 1912 for more
a.