WHAT ABOUT
STOCKS?
Babson Believes Them To
Be Very Cheap
(By KOGKIt W. BABSON)
Babson Park,~Haas.4 jjuy ii. ?
It? is not the (unction of this
column to forecast ? the stock
market. It is,
however, my
duty to give cer
tain facts to
readers. This
week, these per
tain to the stock
market1.
PRICES VERY
LOW
The dividend
paying slocks,
listed on the
New York Stock
Exchange, are
now selling at
less than 14
B ARSON
tluies their dividends compared
with nearly 20 times in August,
1939, and perhaps 27 times in
August. 1929. This means that if
you shut your eyes and blindly (
put' a little money in every divi- '
dend-paying stock, you would get
a yield o f over '<%. With the ex-,
ception of the 1917 break, the|
1920-21 panic, and the 1931-33
depression, at no time in the past
.,'41 years have good stocks been
> eo ch?ep in relation to dividends
as today.
AFTER THE WAR?
Four main reasons aie given
. for t'hese very low prices:
( 1 ) "Present good business Is ,
largely artificial due to the Wnr, .
There wilt be ? gevPre and "long
Tnislness slump immediately after
the War is over." My answer to
this is that the first part of the
statement Is true; but not Neces
sarily the second part.
A sharp drop may be expected
directly after the coining armis
tice; but it should be short fol
lowed by a healthy reconstruction
period which may last for roim
years. In this, t-he United States
and Canada must take a lead
ing. part. Of course, unless some
great new industry conies into
being, the world must someday
"pay the piper", but cannot fear
of such now being overdone? j
FRIGHTENED by labor
(2) "Labor lias the upper hand
and is taking all the profits."
To read t'he newspapers,, one
would think -that -50% of the .
workers are out on strike. Statis
tics, however, show that, at the
very worst, less than 1% of the
workers have been on strike at
any one time ? and less than <%?
of those engaged in defense work. .
This -percentage is too much and
a disgrace; hut are we not "mak- .
Ing a mountain out of a mole
till"?
Of course, there has been con
siderable Increase in wages in
many industries. But why worry
from an investment standpoint?
Wage workers spend all they set.
- If -your investments are properly,
diversified, you get back in ad
ditional profits from your chain
store and. other consumer stocks
What you lose on your stocks
hurt by labor demands. Besides,'
we investors are at fault if labor
leaders win any unjustified |
strikes. We cowardly spick our j
heads under the bed clothes and j
let the labor leaders do all the
shouting.
(3) "The l". S. is doing Com
munistic an<l nothing- can stop
it." Let me reply to this by say
ing that Communism is distinct
ly on the decline ? everywhere
except in the newspaper headlines.
Even there it is the fault of those i
supposed to protect your invest
ments. Consider, for instance, t-he
recent strike in Boston of office
building elevator and other em
ployes. Many of these buildings
are being operated .at a loss and
are practically owned by the
policyholders of insurance com
panies and savings banks did no
picketing nor lifted a finger to
protect- ttoem.
I forecast that after this War
there is sure to be a reaction to
the right ? not further to the left'.
This return to common Bense
would come now if the heads of
our insurance companies and
banks had the courage and fight
ing qualities of the labor leaders.
(4) "Taxes will be so high
this and following years that the
companies will not hare profits
| to distribute." Those who talk
as above are making a great mis
take. Most taxes are passed oil to
;the ultimate consumer. The re
tired person living on fixed in
terest coupons has his net in
come cut down by taxes. But ?
as G rille ? this does not apply to
men in active business who have
their money ill well-selected com
mon stocks. They are tax col
lectors ? not tax payers. The ulti
mate consumer pays the taxes
when buying good*.
There is also another reason
why I do not worry aliout taxes.
The whole Federal and Dominion
tax structure depends uf)on *U. S.
arid Canadiau corporations mak
ing good money. Over 50% of all
government- revenue receipts come
from taxes on corporation profits
and dividends. These governments
have put their heads in a noose!
Unless they permit these corpora
tions to make good profits, the
governments can get no money to
pay t-heir bills. Furthermore, the
tax experts are now learning that
the only way to collect more rev
enue is to help these corporations
to make even greater profits.
FACE THE FACTS
The simple truth is that' none
of these excuses are new. Go to
your public library and ask for
copies of newspapers published
25, 50, 75, or even 100 years
ago. and you will find the same
wailing and complaining. "Panic
ahead!" . . . "Labor becoming
unruly!" . . . YTaxes are too
high!" . . . etc. The very fact
that* most businessmen and in
vestors are discouraged and fear
ful now may be proof that many
prices are far too low. These
same people were bullish in 1929.
The greal> majority are wrong all
: the time.
Can we have a worse twenty
years than from 1920-1940?
Thesewere made up of . foreign
wars, business depressions, reck
less booms, presidential cam
paigns, and every known trouble.
There nevei^ were twenty years
of American history so crowded
with uncertainties. Yet, these
twenty years show that if one
had invested eucli month in each
of America's 24 chief industries ?
he would have received an
income of over 5% in dividends
during the whole twenty years!
Moreover, his real ?'income", in
cluding undeclared earnings,
would have been over I say,
if you will properly invest the
same amount each month ? good
years and bad ? you should come
out all right, whatever is ahead!
o ?
NATION'S TRAFFIC
TOLL FOR FOURTH
LISTED AT 124 ^
Death took no holiday for In
dependence Day but hovered over
the nation's highways to reap a
traffic toll of 124 lives, only four
less than the total fatalities from
all causes on last year's Fourth of
July.
Airplane crashes, drownings,
shootings and other violent forms
of death took an additional 65
lives, bringing) total fatalities to
189 as reported early Saturday.
| Last' year's low record of only
two deaths from fireworks was re
peated. one such fatality occurred
in Missouri and another at Cori-j
nesville, Ind.. where a pytrotech-1
nical expert was killed at an au-;
thorized fireworks display.
Despite rainy weather which
curtailed holiday travel in th?|
Kant, Pennsylvania led the nation
with 18 traffic deaths. One other
death also put the Quaker State
ahead of /all others in total fatali
ties, Ohio and California both re
porting 18 total deaths.
Worst single tragedy was an
automobile-train crash at the
Long Island Railroad's MaMituck.
N. Y. grade crossing, where six
automobile occupants were killed
and a seventh critically injured
Deaths by states:
Alabama 4, Arizona 1. Arkansas
4, California 18. Colorado 1. Con
necticut 2, Florida 5. Georgia 4,
Illinois 13. Indiana 8, Iowa 5,
Kansas 1. Kentucky 3, Louisiana
3', Maine 1, Maryland 2. Massachu
setts 6. Michigan 9, Minnesota 6,
Mississippi 3, Missouri 1. New
Jersey 2r""New Mexico 2. New
York 10, North Carolina 7, Ohio
18, Oklahoma 2. Oregon 4. Penn
sylvania 19, SouTh Carolina 1,
Tennessee 1. Texas 4, Utah 1. Vir
ginia 4, Washington 3. West Vir
ginia 5, Wisconsin 6.
: -O
FOR FIRST CLANS PKI.VllNfi
PHONE v 283-1
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Here, at last, is a fruit juice laxative which tastes good and act*
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iafied with results obtained your druggist is authorized to refund
your money. Prunol cornea in 60c or (1.00 sizes. Sold and1
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Svoftgin's Drue Store, l?ui*burg, N. C.
/ s
cnr SJie&w
-
Beautiful Dexdale and Heiress
Hosiery -- 2 and 3 thread
In all the new and popular shades.
79c
2 pair $1.50
NYLON HOSE
51 Guage
$1.50 pr.
97c
2 pair $1.85
NYLON HOSE
45 Guage
, 97c pr.
Other Special Hose Values
ONE LARGE TABLE
CLOSE OUT HOSE
Values to 97c
Special
59
c pr.
3 Thread 45 Guage
Ringless Chiffon Hose
in all the new and
popular colors
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AMERICAN BEAUTY
Chiffon weight Hose
for extra wear.
Silk and Rayon
25? Pr
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Irregular and Seconds
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^ ^
Olivia de HAVILUND V
||| star of the Warner Bros, picture,
M "S*rowb?rry Blond*," recommends t
Jb| Calox Tooth Powder for teeth
H that shine.
? CALOX pVwdir
Where be applied basic slag in
the spring of 1!)40, John Phillips
of Cullowhee, Jackson County;
says his red clover is at least 50
per cent better than on untreated
land.
To be remembered
GRATIFYING RESPECT
for the wishes of' those who commission us, ton
ed by adherence to modern conventions, leave*
an enduring impression in the minds of all
thinking people. We know that in order to gain
the confidence and good will of the public we
must serve with that thought in mind.
WHITE FUNERAL HOME
K. T. White, Manager
Main Street Louisburg, N. C.
Member New Deal Burial Association.
YOU PAY THE TAX
We have just received
HUNDREDS
LINOLEUM
RUGS
and
DRUGGETS
, You pay sales tax ? 16 cents ?
down and small weekly or
monthly payments.
All other articles in our store
sold on same basis.
ENJOY YOUR HOME
FURNISHINGS
'WHILE PAYING
FOR THEM.
HOME FURNITURE CO. INC.
Telephone No. 415#- 1
MAIN STREET LOCI8BCTRO, N. C.
(W. E. White's Old Stand)
He: f'lf I ran away with your
wife would you get revenge "
Him: "If you ran away with my
wife I'd have revenge.
We like the look of polished
brass.
o
HKNKW YOUIi SUBSC'KH'TION
? BIG 11-OUNCE
- BOTTLE OF ?
HIN
HONEY & ALMOND CREAM
Regular *1 size
limited time only?
GET COMPLETE INSURANCE
ON YOUR CAR
Lots of people still use old-fashioned automo
bile insurance that specifies the hazards the
policy insures against ? and as a result grants
no protection against many perils which could
cause their car to be damaged. Let us tell you
about modern, complete auto insurance that
gives you full protection against practically
all risks. ?
Citizens Bank & Trust Co.
INSURANCE DEPARTMENT
C. Gardner, Mgr.
HENDERSON, N. C.
'Phone 199
HOW ABOUT COMING IN TO SEE US?
OR WRITE OR PHONE.
1
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Q
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1
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SEMI PASTE
Best Grade $0.00
After Mixing " Gal.
| Lawn Mowers $4.95 |
1 Grass Blades 85c |
| Broom Rakes 50c |
SCREEN
DOORS
$1.98
SPRAYS
For Flower Gardens,
Etc. - All Kinds
BICYCLES
$24."
FISHING TACKLE ? BASEBALL GOODS
TENNIS SUPPLIES
FURNITURE VALUES
?
3 Pc. BEDROOM
SUITES
t $37.50
UTILITY CABINETS
$4.95
| 9 x 12 Linolieum Rugs .... $3.75 |
BABY CRIBS $0.50
With Pad A 0
BABY STROLLERS . . $3.95
9x12 GOLD SEAL $C.95
RUGS ..V* ?
COOKING RANGES . ?22-95
H. C. TAYLOR
Hardware & Furniture
Phone 423-1 Louisburg, N. 0.