Montgomery County sentinel. [volume] (Rockville, Md.) 1855-1974, 1948-12-30
194e IN A NUTSHELL

protection and increased produc
ton.
26. The income of wageworkeri
must increase before an advanc,
in prices. Contrariwise, too higl
prices always precede decline~ir
employment and wages. This down
ward cycle leading to unemploy
ment may begin in 1949. Much de
ponds upon crops and weather.
81. Labor leaders who get in
creased wage rates usually get re
elected, while those who do not get
wage increases are liable to be de
feated. Hence, labor leaders hav,
naturally kept urging higher
wages, although they may feel ii
their hearts that wages are high
enough for the time being. W.
forecast that 1919 will see some
change of attitude in this regarc
and that wise leaders will be more
interested in preventing the
bust"
%. If wages are too high, or.
ganized labor is the first to be laid
off when business declines. Unor-
ganized workers have the stead.
lest jobs and will go through 194s
without losing their positions.
20. Some labor leaders will
during 1949, work for pension sys!
TENS and sick benefits. This would
be a constructive program for en-
ployers who can afford to do it,
but many employers cannot afford
even these benefits at this time,
Both employers and wageworkers
will some day unite in urging a
program which will give steady
work throughout the year. This is
the best hope for lower building
costs. Bricklayers, painters and
carpenters are criticized today for
doing such a small amount of
work, but we must remember the
many days when they are unable
to work due to weather and other
conditions.
INITIATION
80. Initiation thigh prices) comes
when consumption exceeds produc-
ton. This means that imitation can
be checked only by increasing pro-
duction or by reducing the money
supply. The job of getting prices
down today depends, therefore,
upon what management and labor
produce per hour. We believe that
wage increases during 1949 will be
accompanied by a corresponding
increase in the per hour produc-
ton of the wageworkers.
81. Some object to the large
profits that their employers are
getting today compared with the
1905. 1t, however, should be re-
n1embered that during these de-
preston years most employers had
no profits whatsoever. We forecast
that profits will continue to be
regulated automatically by the
law Of supply and demand, rather
than by the government.
;32. At some time during 1949
we forecast that the point will be
reached where the nations inflated
money supply win have become
fully employed. Hence, emphasis
may shift from efforts to stop in
fation to efforts to halt defiation.
STOCK MARKET
'33. 1949 may not be a better
year stock market wise than 1913.
Investors will especially get out Of
stocks of companies which have
most of their assets in big, "vul-
nerable in case Of war" cities, re-
investing in companies whose as
sets are well distributed and safe
from attack.
81. The Administration will not
want the Dow-Jones Industrial
Average to go too high on account
Of the consequent effect upon la
boris demands. Commodity specu-
lation will continue to be curbed.
IS. The wisest will not try to
pick any special winners" in
1910; but will diversity broadly.
Those who have too many stocks
win gradually build up good re-
serves, in cash or Governments,
for the big break which will come
some day. Careful buyers Of stocks
will insist on making full payment
and avoid borrowing during 1949.
80. Safe dividend paying stocks
will be in greatest demand, espe-
eially If double taxation on divi-
dends should be eliminated.
BONDS
81. We are definitely bearish on
low-coupon-rate, long-term taxable
bonds as money rates will gradual
ly increase.
80. II Congress should exempt
dividends from double federal tax
alton, 1919 will see a further fall
ing off in the prices Of certain tax
exempt bonds.
30. We forecast no change in
the nations monetary policy relat-
ing to credit control and interest
rates during 1919.
40. Investors will give much
more attention to diversification
in l949 and will try to have their
bond maturities either fairly short
or staggered.
REAL ESTATE
al. City real estate will continue