Babson Predicts:
Major
Slump
In First-Half
Odds Said 10-1 on
i - -
j Half; If Business Drops 10 Per Cent
Chain-Reaction Depression Feared
By ROGER W. BABSON
(Internationally Knows Business Commentator and Advisor)
I do not now believe in the theory of most economists that
: business will fall off 10 per cent in 1954, with a greater decline in
net earnings. My feeling is that everyone will unite forces to hold
up business, at least during the first half, to its approximate 1953
average. This can be done by expanding research, increasing ad
vertising appropriations, extending further credits, and obtaining
labor's co-operation.
But, I say something much more important than the above;
namely, if business should slump 10 per cent, the decline would
probably not stop at 10 per cent. Too many business concerns and
individuals are working on a very narrow and slim margin. The
decline in employment, with resulting business losses which a 10
per cent decline in gross would cause, could result in millions of
' families being unable to pay their bills and installment obligations.
This could set off a chain reaction, which could send business
down 10 per cent to 30 per cent more, with a corresponding de
cline in the stock market, commodity prices, and real estate. In
this latter case, the Eisenhower Administration would suffer as
did the Hoover Administration.
ftlost Communities in "Strong Position" (
i I -
In view of this possible serious alternative, I have contacted
the leading newspaper publishers as to the attitude of their re
spective communities. Of these, over 970 have replied as follows:
The people of 30 communities are discouraged and want to liqui
date; 297 communities are optimistic and want to buy and invest
more; 643 are row content and in a strong position, but are waiting
until they see how 1954 develops. Due to the results of this survey,
I believe the chances are 10 to one that at least the first half of
l 1954 ( WILL BE FAIRLY GOOD.
. -Below are 25 definite" forecasts which, in any case, should
prove correct for the first six months of 1954. My forecast for the
second six months will appear in this paper next June.
No World War in First Half of 1954
1. There will be no. World War in the first half of 1954.
2. The Dow-Jones Industrial Stock Average will be less on
June 30, 1954, than on January 1, 1954.
3. Taxes will be lowered by expiring laws.
4. The price of most commodities will be lower on June 30,
1954.
5. The Eisenhower "Honeymoon" is fast ending and he will
have a hard time controlling Congress during the next six nonths.
6. Retail sales can be kept up by manufacturers and mer
chants spending more money on advertising, selling, and develop
ing new products. --' ";
7. The U. S. population will continue its present growth and
the best prospects for sales in 1954 will be the "teen-agers." ,
S. Interest rates during the first six months of 1954 should
average about as at present, except on the renewal of low-rate
loans.
Farm Land Prices May Slip
9. Farm lands', except near cities, will sell for less during the
first half of 1954, when farmers' profits will begin to decline.
. . 10. The Central and. Southwest will not suffer drought as
in 1953.
11. There will be more fear of World War III as years go on.
People will gradually move out of certain large cities. Nearby
farm land will be split up. A rise in the price of certain fringe
farm land is certain.
12. The U. S. Government will give less money to the Euro
pean and other nations direct; but will help them through the
United Nations.
13. There will be fewer employed next June the total take-home-pay
will be less than last June. This, however, may be a
good thing for the morale of the nation.
: 14. The present Administration will suffer much opposition
to attempts to reduce tariffs if profits decline or unemployment
increases.
Bad Strike Seen as Probability
15. The Administration and
vamp the Taft-Hartley Bill during 1954; but bad strikes are coming.
16. I am no weather-prophet, but experts expect a warmer
winter ior the eastern portion of the U. S. and a colder Florida.
17. Canada will continue to boom during the first half of 1954,
but this may be a good time to take profits on Canadian inyest-
ments.
r 18. The above may also apply to Southern California and its
airplane and movie industriesoth may have reached their peaks
; ior the present -L
19. Automobiles will be harder to sell and easier to buy dur
ing the first half of 1954. Both the automobile stocks and the
cars will be in less demand. There will be more bargains in used
cars, discounts on new cars, especially cars of the "independent"
manufacturers. v
20. Florida may have killing frosts during the next few
months. This will cheer up California, Arizona, and Texas. ,
21. The Korean situation will remain about as is as the
Chinaman says, "much talkie, no shootie."
Cabinet Resignations Believed Likely
22. There will be one or two resignations from the Eisenhower"
"businessmen's Cabinet," replaced by "politicians." All is not going
too welL The President is hot used to being pressured by lobbies.
23. The first halfot 1954 should be your best time to get
out of debt or at lest reduce your debt. Remember that most
bankers are in the bus ness of "loaning umbrellas when the sun
is shining, and calling them in when it rsins." Moreover, you can
not blame them because the umbrellas really belong to the de
positors, who-also will want them on rainy days! Operate so you
,can clean up bank loans once during 1954.
24. tThe companies which will prosper most are those which
have inaugurated effective labor-saving programs. Most manufac
turers are learning that they cannot beat labor through mere
strikes. They are winning only as they purchase new labor-saving
machinery, spend more money on resenrch and on well-directed
advertising.
23. There may be some further inflation in 1954; but perceit
agewise to the total national output it should , not help the stock
market. " ,
What Will Ei-"boner Do? a
I have promised to answer the following four questions:
1. Is Eisenhower to take the advice of Assistant President
Adams, representing certain Republican leaders, and turn to the
left? Or, will he st'ck to his conservative election phtform?
Answer: He willstick to his election platform.
2. To put the question in a more practical way: Will 1954 be
a year of reform and economic adjustment as promised by Presi
dent Eisenhower, or will he give the country more inflition, and
- further pliy Snt3 Cteus to labor, farm, high tariff and other
groups? '
Answer: He is Iv:nirg t'a:t "economic reforms" must be
grtdnsL .
: 3. Will he run the risk of losing Congress in 1954 and the
election of 1S56 TOR A MATTER OF PRINCIPLE, AS . DID
HOOVER IN 1932? Or, Will he-succumb to the temptation of
changing his policy with an attempt to "save his party"?
Answer: He will run tbe rik.ef I'xiw Congress in 1954, and
the chance U ran a?atn in ?56. '-. : -
4. Is a "middle-of-the-road' policy prretical? Will it serve both
groups, or no group? ' - ; .
Answer: Tea, it is practical for working a gradual change, and
it should serve both grps. vt . ;
- j (Capyris tat I9S3, PvkUshcn FlnutcUI Bnreaa. tec)'
Business
'Unlikely'
'54
'Fairly Good' First
the Labor Leaders will try to re
i ! POUNDED 1651 ,
103RD YEAR
Washington newsmen interpret
the comments of Secretary of
State John Foster Dulles at a
press conference Tuesday , as
warning Red China of trouble if
it openly intervenes in the war
in Indochina. Of eourse Red
China is intervening as a supplier
and base for the Vietminh rebels
in Indochina; and the United
States is serving as banker and
supplier for the French and Viet
nam forces.
Dulles warned that any renewal
of hostilities in Korea or a
Chinese Communist entry in In
dochina would bring a U. S. re
action not necessarily confined
to the particular area the Commu
nists choose to make the theatre
of their new aggression." The
common interpretation is that the
U. s. then would launch naval
and aerial warfare against China
itself, perhaps unleashing some
of its new weapons.
Dulles should take care lest he
be accused of starting a "Dulles
war." Republican partisans called
our intervention in Korea "Tru
man war. We wonder, too, if
the event occurs which Dulles
warus against whether the ad
ministration would move to make
resistance a United Nations en
terprise, or would ask Congress
to declare war formally on Red
China. Surely it will not expose
itself to the criticisms which Re
publicans used against Truman.
It is safe to say, however, that
Dulles used this strong language
in the hope that it would deter
the Red Chinese from further
military
(Continued on editorial page, 4.)
Gary Cooper
Hollywood's
Boxof f ice King
o
HOLLYWOOD W Slim, 'slow
talking Gary Cooper, who won this
year's top Oscar, Wednesday was
named the boxof f ice king as well
Motion Picture Herald's 22nd an
nual poll of movie exhibitors se
lected Cooper as the No. 1 'attrac
tion . in , film theaters. The movie
veteran has placed in the top 10
fourteen times, but this is the first
time he has loped off the winner.
Cooper displaced Martin and
Lewis, who held top honors in 1952.
The zany comics, who soared to
fjpne largely through their TV
appearances, slipped to second
place.
John Wayne, who starred in ac
tion films and the divorce courts,
retained his No. 3 position. He
was the top man in 1950 and 1951.
Allan Ladd, who once before was
among the top 10, made a rapid
return from 16th to No. 4. He
knocked Bing Crosby down a notch
to fifth. The groaner held ths No.
1 place the longest of any star
(1944-43.
Marilyn Monroe, who added a
new dimension to sex on the screen
won her first boxoffice' recogni
tion by placing sixth on the list.
She and Susan Hayward (repeat
ing as No. 9) were the only act
resses in a field heavily laden with
cowpokes and comics. '
The top 10 was rounded out by
James Stewart (No. 7), Bob Hope
(No. 8) and Randolph Scott (No.
10).
Temperature
Slides to 28
It was chilly in Salem Wednes
day.; The mercury dipped down to
28 degrees in early morning and
only climbed to 37 for the day's
high at mid-afterncon. V
Fog reduced visibility "to zero
in . early morning and the white
stuff hung on, although thinner,
to see the day out. f
Forecast for today, calls for
light rain and warmer tempera
tures. Can You Spell
1, CQ0 Words?
Starting , next Wednesday,
Jan. 6. The Oregon Statesman
will publish 20 words on Page
1 daily for 50 "days. They will
comprise therbasis -for oral
semi-finals " and finals in the
1954 Statesinan-KSLM Mid-Valley
Spelling Contest!
. The words are offered as a
daily stimulus no composite
"st of them will be available.
All are from ' standard text
books. - . -
Eigfty-three s c h o'o 1 s and
nearly 4,000 seventh and
eighth grade pupils will take
part in the contest the fourth
one of its kind. The progress
and results of the competition
will be an interesting and ex
clusive feature of-
" Yor Home Newspaper .
CUT T
12 PAGES
'Watchnight'
i i ' " - i
Grouped around a small organ at the Pilgrim Holiness Church here are participants in the three-day
i midwinter convention of young people from Pilgrim Holiness Churches in Western Oregon and Wash
ington. The Rev. William S. Deal, Salem, is in charge of the convention which will conclude tonight
with a watchnlght prayer service. Shown above from left to right are Gladys Caller, Marysville,
Was Rebecca Story, Salem; Elaine Cox, Medford; Roy Dworschak, executive youth secretary, Eu
geneTand William Parker, Portland. (Statesman photo.)
Knowland Wary of Ike'siEugeneCafe
Defense Job Shift Plan ! Pickets March
WASHINGTON (JP) The Republican leader of the Senate, Sen.
Knowland of California, said Wednesday the administration's plan
to channel more defense orders into centers of unemployment is
disappointing and "too wide."
Knowland said he would back legislation to limit the program,
already under a drumfire of criticism from the South.
Thus the White House was con-',
fronted with a top level split on
policy on the eve of a vital con
gressional session in which the
GOP will hold only a shaky mar
gin of control.
'My own belief," Knowland told
a news conference, "is that the
order is still too wide and needs
curtailment. It' still appears to me
that on the set-aside provision, the
percenage is not spelled out."
That was' a reference to a fea
ture of the plan to set aside por
tions of defense orders for areas
where there is a labor . surplus.
Contractors in those areas could
qualify for the work by meeting
prices established by competitive
bids in other areas not suffering
from unemployment.
Presidential Press Secretary
James C. Hagerty said Tuesday
20 to 30 per cent of some orders
would be earmarked for areas cf
serious unemployment. Knowland
said 20 or 30 per cent is "far too
much," and there will "definitely
be some legislation" on it after
Congress reconvenes next week.
The administration plan, a modi
fied version, of one set up in the
Truman administration, was put
into operation Nov. 4. Presioent
Eisenhower gave it an endorse
ment and a push Tuesday at the
J temporary White House jn Augus
fta, Ga.
Deetz Applies
For License
Statesman Newi Srrvlce
CANBY Elmer Deetz, i
re-
cently adjudged guilty of selling
milk without a license, has served
notice he will take the case to
court himself if the State Agricul
ture Department refuses to grant
the license for which he now has
applied.
Deetz, apparently anticipating
the department will refuse his ap
plication on the grounds that his
machinery does not meet require
ments, wrote the department that
"records show I have achieved
purity standards' required.
He termed requirements for
specific machinery "capricious,"
and asked for a hearing as provid
ed by law.
Pen Parolee
Kidnaps Cop,
Recaptured
MONTECA, Calif. Police
Tuesday captured Carl D. Smith,
22, a prison parolee from " Med
ford, Ore., after a car in which he
forced a. policeman to drive him
crashed into a power .pole.
According to Dist. Atty! Chester
Watson of Stockton, Smith' had
been paroled from San Quentin
prison, but jumped parole.
Policeman Robert Khan arrest
ed Smith at gunpoint and headed
him towards a parked police car-
P.nt ' Smith lmnrkp1 lh mn frnm
from his, pocket and ordered Khan
to drive him .away in the police
car. - .
Khan complied, but the: vehicle
crashed into the pole at high speed.
Khan, who suffered head and chest
injuries, was dazed but Smith fled
despite face and head etifx"
Smith was washing bknd from
bis face at a lawn,, faucet when
sheriffs deputi: spotted 'him.; He
threw away, his ; pistol and1 sur
Th Oregon Statesman, SaUxn, Oregon, Thursday, .December 31, 1953
to Include Church Delegates
is . k i - s 9 , Kjr
Driver Caught
As Car Rolls.
Seriously Hurt
Twenty - seven - year-old Robert
Eck of 3380 Winola St., was seri
ously injured ..Wednesday after
noon when his panel truck col
lided with a car at 14th and Lee
streets and flipped over twice.
He suffered a fractured skull
and was taken to Salem Memorial'
Hospital, but later was trans
ferred to Providence Hospital in
Portland where he underwent
brain surgery last night.
Hospital attendants there said
he was not on the critical list
Police said Eek's truck collided
with a car driven by Richard
Gchring, 45, of 4144 Hager St.
shortly before 4 p.m.
The truck was traveling west
on Lee Street and Gehring's 1949
Ford north on 14th street, police
reported.
, Eck was injured when his
head apparently was caught be-
tween the door and the frame
of the truck. The vehicle landed
on its left side. .
Citizens had removed Eck from
the wreck before police and first
aidmen arrived.
There were no passengers
either vehicle.
in
was smashed and the front end of
the car was badly damaged, po-
lice said. Both were towed.
MEAT CONFERENCE SET
CORVAtLIS UP! A meat mark
eting conference sponsored by the
Oregon State College Extension
Service will be held here Jan. 6-7.
Today's Statesman
.
Ryan Reports on U.S.S.R. 2
Valley news 3
Editorials, features 4"
Society, women's .6
Farm news 7 '
Sports . 8, 9
Comics 9
Radio, TV 10
Classified ads 10, 11
Markets ..... 12
W atphiiight Services Sch eduled
Tonight in Many Salem Churches
By VAN EISENHUT
Church Editor, The Statesman
' New Year's eve watchnight
services are scheduled tonight in
many Salem area churches, and
a few congregations have sched
uled a worship hour Friday morn.
Early evening programs will
include social hours, songs, games
and films but all services will
dbnclude. with a period of devo
tion and prayer shortly before
midnight
The following churches have
announced New Year's programs:
Bthel Baptist choir program,
9 p.ml, fellowship and refresh
ments 10 p.m.; worship, 11 p.m.
C?lvzry Baptist program
starts at 9 p.m. with a consecra
tion service from 11 o'clock to
midnight . .
Capitol Baptist program at &i
Despite Ban
EUGENE W) - Picketing of the
Paul Bunyan Burger Restaurant
j here continued Wednesday despite j
an order by r red O. bcherer, state ;
labor examiner, that it be stopped.
(Story on page 2.
Scherer issued the erder Tues
day to the AFL Culinary Alliance
under the state's new anti-picket-1
ing law. But the union said it had
not yet received a copy of the '
order. . - - , !
The law savs a union raav nnt !
picket to organize workers. Mr. j
and Mrs. Julius Gilbertson. who!
own the restaurant,, contend the
picketing js to coerce employes.andl
deny them the right to decide
whether they want to join the un
ion.
However, the union insists-a ma-
;'ority of the restaurant employes ! trict . . . The only alternatives
were members prior to last May, j to one-way streets in the heavy
and that the owners refused to bar-! traffic centers are a system of no
gain. r 1 lefWurns, a prohibition of down-
After two heannas Scherer uo-
held the employees. Earlier he is-!
sued a similar anti-picketing order!
against the AFL Culinary union in !
its dispute with the Cave Shop
restaurant at Grants Pass. But the ;
union appealed the order and j
picketing .continues pending a de-'
cision by Circuit Judge O. J. Mil-'
lard.
The AFL and OO contend the
law is unconsitutioral and have
' said they will Scarry their f ight
j against it to the Stale Supreme
r Court if necessary.
'
;
I WiVkll I flnfC!
1 OlIUlllU.CI O
Posts Bond
ST. LOUIS UP Former Police
Lt. Louis Shoulders, - accused of
lying to a grand jury seeking the
nlcoinrr COnn AAA f r.nniilnn.i,
Greenlease
ransom money, surrendered Wed-1
nesday to face a federal charge
of perjury.
Shoulders, who appeared to be
in a jocular mood, went to the
federal marshal's office with his
attorney. Henry G. Morris. He im-1
mediateiy posted 510.000 bond be -
fore U. S. Commissioner Edwin J.
sean ana was reieasea.
He is to appear before federal
authorities at Kansas City at a,
Jl 7T i.- iT -r a ' 3
indicted him there Tuesday, say-
ing he testified falsely on how he
handled suitcases containing the
ransom money. Less than half of
the $600,000 paid by Robert Green-
lease Sr. was recovered.
p.m. with worship service at 11
o'clock.
t Joseph's Catholic no Newj
Yerr's ve service. Regular Sun-
drv mass schedule Friday. !
c-4 tr- ' .. ,. i
SL Vincent dePaul's Cnthobc
no
service
scheduled on News
Year's eve but the regular Sun
day mass schedule will be fol
lowed Friday,
Christian and Missionary Al
liance program at 10 p.m. with
communion service at midnight
First Christian Social hour
starting at 9 p.m. with youth
groups in charge of worship.
Garden Road Christian Con
gregational business meeting at
8 p.m. followed by a social per
iod and worship service at mid-?
night , j.
Knight Memeriar . Congrega
tional program at 9 p.m. with
watchnight service it midnight
PRICE 5c
New Marking
Ordered For
One-Way Grid
Survey by Officials Brings Gill for
. More Signs, Repainting of Arrows
By ROBERT E. GANGWARE
City Editor, The Statesman
Better marking of the one-way street grid in downto
Salem was ordered Wednesday after an arrow-to-arrow
spection by a party of top city and state highway officials.
Scores of new signs and repainted street arrows will fe
ture the authorized improvements, and some of the installati
will start "immediately," declared Mayor Alfred W. Loucks.
Although planned by the city
administration several weeks ago,
the grid survey actually came in
the wake of a petition movement
which in the past two days has
claimed more than 400 signatures
of citizens opposing the one-way
street grid in the downtown disj
trict.
In response to the petitions,
officials reiterated Wednesday
they, think the grid, which went
into effect Oct. 21, has not yet
had a fair trial.
Fears Traffic Snarls
Mayor Loucks said, "If we were
to go back to two-way streets
right now, I feel sure it would
result in serious loss to those with
investments in downtown Salem,
would produce greater traffic
snarls and tend to push shoppers
outside the area."
State Highway Engineer R. H. 1
Baldock stressed that his depart
ment has helped set up the grid
only at the city's request, since
the original recommendation for
a one-way city street grid was in
cluded in the state traffic plan
for Salem's new bridge, bypass
route, one-way highway couplets
and other features.
Baldock Defends Plan
But Baldock had this to say
Wednesday:
"The city would be making a
serious mistake to abandon this
-way. grid; By adopting the
grid, SalemTia. "taken posiUve ac-
tion against traffic congestion
and toward the holding of busi
ness in a central downtown dis-
town parking on the streets on
both."
(Additional details on page 12)
I
I if I mA r 11 Till ilf
AtPre-Boid
LuncheonTalk
; LOS ANGELES OP
If UCLA
. doesn't do better in the Rose Bowl
Friday than it did Wednesday at
i its pre-bowl luncheon it's Michi-
: gan State by a mile.
The Bruin Club was to prrsent
j a trophy to All-America back .ul
Cameron. An appropria'e ,sp3cch
was made extouing cam?ron s
merits but the president of the , scek re.elcclion n,xt y,ar he an.
club had to tell Cameron that the nounce(j Wednesday
engraver wasn't through with, the j Day was elected m 1950 to repre
cup .and that it would be along t ,arkson pmrntv in th sn-
i later-
Toastmaster Sam Baiter opened
hre with it isn t the function of a
toastmaster to bore you, but to in
troduce you to people who will."
Then he couldnt find the list of
dignitaries he was to introduce.
The UCLA band, playing Ger-
: shwin's "Rhapsody in Blue." went
silent as a page was turned and
there jrst weren t any more notes
Ths music had been misDlaced.
UCLA coach Red Sanders' mic-1
rophone went dead .while he was
speakin?. Finally, he shouted:
.an ? heaf e back there.
..... u
'No- came the chrous.
"You're not missing anything,"
Sanders assured one and all.
First Evangelical United Breth
' ren Film at 8 p.m. Meditation
nd communion starting at ll
0 clock.
Central Lutheran PTOgram
starts at 9 p.m. followed by de-
nJ t w r.r,
i service at 11 p.m sponsored by
' church youth.
St John's Lutheran Worship
service from 7:30 to 8:30 p.m.
Morning service at 10:30 o'clock
Friday.
. First Methodist recreation
program starting at 9 p.ro, Wor-
i ship at midnight in the sanctu
ary. . : .
Leslie Methodist social time
starting at 8:30 p.m. Communion
at 11 p.m.
Salvation Army covered dish
dinner at 6:30 p.m. followed by
a sochl hour and worship ser
vice at 11 p.m.
No. 276
CIO Aid
Rejects
Ike's Call
By NORMAN WALKER
WASHINGTON I - A top Ci
staff member Wednesday refii. .
to accept a post on an advisor
board to which he had been namep
by President Eisenhower. !
Stanley H. Ruttenberg, CIO tre
search and education director,
wrote the President rejecting a:;
appointment as member of the In
ternational Development Advisory
Board, which advises the govern
ment on its program for giving
technical aid to underdeveloped
countries.
Ruttenberg said he never heard
of his appointment until he read
about it in newspapers and then
checked with the White House. He
said it was a vacancy caused by
Eisenhower's failure to reappoint
another CIO man.
No Check in Advance
"It seems inconceivable to me.'
beTrt ftTwnHo
ttnfaf S tJ dta7 thl mS
Ruttenberg wrote the Presidi-nt
ques
tion of my appointment in advance
of its publication either with me
or with the appropriate officers ol
the CIO."
Ruttenberg's refusal came aboul
two weeks after AFL President
George Meany quit as a member
of the foreign economic program ?
Public Advisory Committee.
Blamed Stassen !
Meany charged that foreign on
erations administrator Harold L.
i Stassen had fired many American
i union representatives employed in
government aid offices abroar.
Meany also said Stassen had fai'cd
to encourage labor unions in oth-r
countries.
However, it was learned Wed
nesday that Meany has since talk-
e tn stasseQ and is due to con-
fer with him anain next wt;k.
on t
MEDFORD. Ui State Sen. Ein
Day, Gold Hill Republican, will not
, u t umia m nil At. uuirui j 1 1 n 111 iiiil
ate. He had served in the House
, the year before.
Day, a rancher, concerned him-
self chiefly with weather control
and school legislation. At the last
. . m a
session ne was cnairman oi me
Public Health Commission, vice
chairman of the State and Fed
eral Aflfairs Committee and a
member of the Education. Agricul
ture and Public Welfare and Insti
tutions con:mMtees.
max. Ti.n. Pre
Salem : 37 28 .M .
Portland ... 44 33 JOO
San Francirea : ... 59 3 .00
Chicago ' 29 IS trac
New York 48 40 .00
Willamette River 4.7 feet
FORECAST from U. S. weather
bureau. McNary field. Salem):
Cloudy this morning with light rain
this alternoon and tonight High to
day near 44 and low tonight near 36.
Terrperature at 12:01 a. m. was V.
degrees.
SALEM PRECIPITATION
Since Start of Weather Year Sept
This Year Lat Yeah Norm..
19.7 11.22 llf
Animal Crackers
8v WARREN GOOORICH
a
01
"May I hove this done?
-4