The Ypsilanti daily press. (Ypsilanti, Mich.) 1928-1962, 1943-07-30
By Roaer W. Babson

Gloucester. Mass. July 5o-I
am spending a few days here in
his great fishing center. In fact,
an writing this column in the
house where ! was born at IS Mid
dle Street These annual visits
mean much to me. They not only
enable me to renew old acquaint-
anCes, but learn much from not
ing the changes Of the past fifty
years. Both the sunny and the
dark sides Of the business and So
cial cycles are so evident in this
, old city.
Avoid Doing as Others do
It was only few years ago
that the Gloucester City Fathers
felt that the fishing business was
gone for good; while that their
future prosperity would depend
upon the tourist and summer bust
ness. Today, however. the fish
business Is operating at an all-time
high with great profits TO all en-
gagged therein: while many OF the
summer hotels are closed and cot.
tages can he rented for song.
Yet, the breezes are as cool; the
bathing is as fine. and the sunsets
are as beautiful as ever. Certain
ly. this is the ideal summer TO
visit Gloucester and similar re-
sorts 10 get both rest and attention.
This great change in the local
situation here reminds me OF one
Of the many wise things which my
father used to say:-"The wheels
of business and investments are
continually turning few per-
sons have the courage to get on
the wheel when prices are at the
bottom and TO get off when at the
top. Most people follow the crowds
and get on the wheel when prices
are al the top and get off when
they are at the bottom. Those,
however. who will get on the
wheel and stay on. through high
prices and low prices. will get
6 per cent interest. a fair profit and
reasonably security"
Banks May be Wrong
Just now New England people
are much disturbed about mort
cages which were the prime and
safest investment when ! was
\ boy. Since then much OF the
mortgage property has deterior-
ated and the banks have been
compelled. by timid and short
sighted directors. 10 force foreclo,
sures, As a result. much real es.
tate can be purchased at 80 per
cent TO 40 per cent OF the assessed
values. and Of course. at less than
the mortgage. | am inclined to
now wonder II these bank direc-
tors may not now he as wrong in
their judge OF mortgages as they
were in their judge OF railroad
bonds when they sold them at all
time low prices.
There Is no reason why both
the real estate market and the
mortgage market should not have
their ups and downs like stock
prices. commodity prices and even
employment. In fact. when en-
ployment and wages are at an all
time high-as at PRESENT. is a
sure bet that the tide will turn
and run out sometime after World
War II. Hence those who now
quit peacetime Jobs. Just to get
more money at war jobs. are max
ing a big mistake. Those who are
now taking losses on mortgages
may he making similar mistakes,
Recently the L. s. Treasury
stated It spent s7S. 5000 900 900 dur
Ing the fiscal year ending June
80. 1913. This is ten times what
il spends in peacetime. Two thirds
of this (S56000. 900, O00) has been
paid for by printing government
bonds. This is little different
from printing green backs. This
great initiation OF the currency
should surely make it easier for
people TO pay off mortgages dur
ing the few good years following
the war II they will have sense
enough 10 do so. In the meantime.
new houses and new office build
ings are not being built, except
for war needs.
This coming initiation Is. how
ever. not a reason for investors
TO take on more mortgages. |
had much rather now invest in
good stocks or in producing, we'll
maintained real estate. Banks.
however, cannot now buy stocks
or real estate as an investment.
They are confined To mortgages,
bonds and commercial paper. Tn.
der these conditions feel that-as
a rule it is mistake for banks