Marion progress., 1949-12-29
BABSON'S FORECAST
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Continued from first page)
tai. Moreover, some of the nuis.
ance taxes may be eliminated OF
reduced.
II. The Iong-term capital gain
tax of 25 per cent will remain un-
changed.
18. There will be many increas-
es in local and state taxes, and
more reaching for relief by "sal-
Is" taxes or other forms Of rails
ing needed funds.
RETAIL TRADE
10. Goods on counters will be OF
better grade in 1850 than they
were in 1949
20. Markdown sales will con-
4inue during 1850 as consumer
spending slackens due to decline
IN employment and other factors.
21. The dollar value Of all re-
tail sales in 1850 will also be less
in 1850 than in 1949.
%. Less will be spent on new
building and equipment by stores
and factories during 1850.
Foreign Trade
23. Our exports will be down
during 1850 and our imports will
be up during 1850, comparing
both with 1949. This will partly be
accounted for by the ,~dexaluation
>of the. English Pound and other
: foreign currencies. -
t..9ss 25. ForeieH credits will continue
to be granted during 1850, but
some of these will be direct by
American Business firms and in
vestors. If our Government will
get foreign governments to agree
fhat such investments will be ex-
empt from any new tax or other
legislation by the foreign country
in which the investments are
made, considerable progress would
be noticeable along foreign trade
channels.
25. American interests will have
more competition from foreign
producers of raw materials and of
manufactured goods during 1850
than they had during 1949. This
will benefit some American con-
Germs, but be harmful to others.
26. Fear of war with Russia will
continue during 1850. World War
III will come sometime; but it will
not start during 1850. Those in
Large vulnerable cities should use
these years of peace to get some
small farm or country home to
which they can 60 in case of war.
Such places will be almost unob-
tainable when war actually COM
es.
Deficit Financing
27. The supply of money will be
increased during 1850, but the
price of Government bonds will
not change much one way or the
other during 1850.
%. In addition to the anticipat
ed Federal deficit the $4,000, 0,Oe0,-
600 being distributed ss insurance
refunds to veterans will be mostly
spent.
20. Congress will not change
the price of gold during 1850.
Stock Market
Most stocks will work up and
down in about the same range dur
ing 1850 as during 1949.
81. Stocks of companies with as
sets mostly in natural resources,
known as initiation stocks, should
have the greatest demand.
80. There will be more invest
ment buying for income during
1856 and utilities and companies
making labor-saving machinery
may be more popular than other
industrials or railroads.
33. The wisest investors will
keep a fair amount of their funds
liquid throughout 1850 pending
the great break in stock prices
which will come someday.
Bonds
"a. High-grade taxable corpor-
ate bonds bearing low coupon
rates should continue at about the
same prices during 1850, but of
course, they will sell for much
lower prices when money rates in
crease.
35. 1850 will see further fad
ing off in certain tax exempt
bonds due to the new Housing Au-
shorty Obligations to be issued
during 1850.
SO. The Federal Reserve will
continue during 1850 the same
general policy which it followed in
1949.
81. The Importance of diversifi-