The Farmville herald and farmer-leader. (Farmville, Va.) 1934-1957, 1954-01-26
People Will Have Money
To Buy In 1854 Says Babson

To Buy In 1854 Sa!
washington, D C,--There has
been a lot of loose talk about the
rise in the cost Of living and the
ability OF people TO buy Many
readers have asked for dependable
facts, Here are the official Govern
ment figures
Cost of Living
To a degree. whether people
have money to buy depends on
what they spend for their daily
NECESSITIES. Living costs,
without question, have been flat
tening out. From January !, 1852.
TO date, consumer prices have
risen less than &c This compares
with rise CT 1870 III 1876,
6Gd jump in 1850, and a ass
push in 1851
What makes these figures even
more meaningful IS the fact that,
while living costs have risen less
than 2Tc since January. 1882,
hourly earnings i'll all manufact-
uring industries have risen about
go during that time. To have
held prices down While wages have
gone up IS a great achievement
on the part of manufacturers
and merchants.
Fewer People Employed
If people are to have money to
buy. they must have Jobs. Al
though our labor force normally
increases by about 100000 per-
sons a year-for whom jobs must
be provided-1953 figures show
very little change from those OF
1852 This is because new workers
young people entering the labor
market in 1858 just about equal
ed the number Of people who left
it.
What is really happening?
Some workers have left the ranks
Of the employed to retire Some
wives who have been holding
down full-time Jobs have decided
to quit working out and to make
real home for their husbands.
Many have not been replaced.
These people do not swell the
ranks of the unemployed, they
simply deplete the ranks OF the
employed TO whatever extent they
are not replaced Obviously, in re-
| tirement one has less income.
Obvious. also, is the fact that
when a wife ceases to supplement
her husbands income, that couple
will have less money to spend.
Savings Beat All Records
There's another angle to our
problem. How much money peo-
pie have hidden away in their
socks. 1t may surprise you to learn
that the top 500 of our families
have readily convertible savings
amounting to a staggering S97
Billions. The bottom 500 share
81 billion in liquid savings. Our
people must build up 5000 billion
equity in their homes, with but
$50 billion mortgage debt 500 OF
people must build up 5000 billion
worth OF automobiles. And 500
Of all families have a net worth
greater than years income.
When the figures are all in,
T am pretty sure that 1858 will
prove to have broken all peace
time records for savings. People
spent much less than they made
in 1858. Cash or readily convert
lble assets saved in 1853 could
nave scared to better than SIC
1illions, compared with about 50
billions in 1949 and about S12
billions IN 1851 Perhaps the MAD
RUSH to buy is over This is a
healthy sign.
Key to Prosperity
like to see this trend. UP TO
a certain point. However, too
much money lying idle is bad for
our economy. America, you see, F.
is a country that actually develops !
its way TO prosperity. And the
way to keep prosperity is to keep
raising our living standards .
higher and higher by creating
more and more wants for more I
and more goods and services with
out proportionally increasing
what people owe.
There are enough Americans
who have money to spend in 1854
TO hold business high. If, for ex-
ample, the top 500 OF our fam
lies with their s97 billions con-
5inue to hold their purchases
nigh, the lower 500 will be kept
BUSY producing. All groups will
hen have the funds necessary to
;atisfy their needs. We have a
lUge backlog of buying power
is up to the sales and advertis-
ng brains of the country to get
,s m enend il