The Bluffton news. [volume] (Bluffton, Ohio) 1875-current, 1956-12-28
BY Roger w. Babson

Both presidential candidates, in
their prediction speeches, promised
PEACE, PROSPERITY, and PROG
RESS. They stated that they must
do this in order to enforce the En-
ployment Act of 1916. This is the
basis of my Outlook for 1857, tenn
pered of course by Russia.
/. World War III will not start in
1857.
2. 1857 will witness gradually in
creasing initiation.
8. Manufacturers will be faced with
higher costs for both materials and
labor.
a. All businesses will be confronted
by increased competition. both within
their own industries and from other
industries.
5. More advertising will be neces-
sary in 1857 if profits of manufac-
turers and retailers are to equal
those of 1856.
6. Failures will increase in 1857
both as to numbers and liabilities
Thousands of small concerns will be
wiped out. One or two of the largest
corporations will face bankruptcy OF
reorganization.
Z. Cost of living will rise slightly
during 1857.
s. Most labor unions will hesitate tc
make public fights for higher wages
but will work for shorter hours
| pensions, and ifringes."
8. Europe must pay SO much more
for oil that it will have less money fol
purchasing other goods.
10. Unexpected events will occur
during 1857; however, as a whole
business will remain fair, but with
smaller profits.
MONEY OUTLOOK
II. AS foreign countries must pay
in gold or dollars for oil, their indus
tries will be handicapped, unemploy-
ment will increase, and pressure for
aid from the United States will be
greater.
IL. The Federal Reserve Board will
not relax its restrictions SO long as
we have full employment in the
United States; but if unemployment
increases we may expect a relaxa-
ton. am very glad Mr.. Robert
Cutler will again be Mr.. Eisen-
hower,s adviser.
13. Owing to the tremendous num-
bers of employees, suppliers, and
retailers dependent upon the large
corporations, these will be first tc
receive bank funds.
IA. Many plans for expansions oi
plants, by both big business and little
business, will be postponed. Most
corporations will find it difficult t6
get new short-term money at an,
price in quantity; while long-term
financing will be to expensive.
Is. Tight money will cause state
municipal, and town governments t.
postpone plans for building roads
schools, and hospitals except in cases
where the Federal Government pay
most of the costs. This will put ;
damper on many lines of business.
16. Owing to these increased none.
rates, state, municipal, and tow
bonds, although tax free, have beel
declining rapidly in price. Mos
financial advisors forecast mucl
lower prices for such securities. ]
is possible that the postponement O
such building plans may so diminisl
demand for such money that thes
non-taxable bonds will sell at highe
prices before the year is out Thi
postponement may also reduce tn
price of steel and other materials
IL. The money managers of eacl
corporation, large and small, vii
now arrange their financing needs fo
two years by either securing tn
necessary funds now or reducing
their requests.
Is. Prices of corporation bonds vii
not recover SO quickly as the non
taxables. forecast lower prices 70
most corporation bonds.
i 19. Many of the smaller and newe
corporations will be much disappoint
ed by their inability to secure fund
during 1857, except by selling con
vertible preferred stocks on term
very favorable to investors. 1t i
well to issue such securities whel
money rates are low, because the ad
vantages continue for many years
but not when money is tight. as sue
securities then tie up the borrowe
for long number of years at hig
rates.
'sssSseSs Ssex~eS~sta