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DALLAS, PENNSYLVANIA
: 1 ’ For 1967
= 3 Babson’s Forecast For
of 3 crease our commitmnt in order to 24. Labor stands at the crossroads | ficult in 1967 on business accounts,
e- a retain this upper hand. as the new year opens. Things never | consumer installment and charge
rs 2 8. I predict, therefore, that mili- looked better for nailing down rec- | accounts, and mortgage debt. I fore-
in tary spending will be raised in 1967. | ord wage and fringe gains; however, ' cast a further rise in nonfarm real
This dan help soften the impact of | neither the public nor the Congress’ estate foreclosures.
st any easing in the private sector | is in any mood to tolerate long, | 39. Barring crop failure, I fore-
d i of the economy. | costly, and inconvenient shutdowns. ' cast another good farm production
1- 9. Turning now to domestic con- | I freely predict that there is more | year, Farm prices should rule firm
ez ditions, I foresee a definite deceler- | likelihood in 1967 of restrictive labor | t, slightly higher in 1967, but higher X
it ation in business activity in 1967. legislation than at any time since costs may result in a slight drop
/ The fantastic boom is in need of Taft-Hartley was put on the books. in net realized farm income.
rs a rest. Instead of the strong up- Unie chiefs fre Pee of ie: ond 40. Neverthless, farm equipment
2 Roger W. Babson trend of recent years, I look for a they may -act with more strike ufact hould 3 d
S Y hy . manufacturers shou enjoy goo
high level of industrial production restraint than most people now ex- |p nos Sales of fertilizers and — CUT FROM YOUNG CORN-FED PORKERS —
or, BUSINESS AND ANaNCIaL early in the year; but unless some pect. : insecticides should post gains. ®
10 4. FORECASY new stimulus is introduced, I fear 25. 1967 promises to be a year 41. 1967's stock market promises
ob Thi@ close of 1966 marks the that a cresting-over pattern is like- in which many managements will be | to be one of vicious selectivity. I
Y, seveiitieth consecutive month in | ly to develop as 1967 progresses. fighting a “rearguard” action to|am expecting the old aristocracy of z
a, ‘the life span of the longest business 10. I forecast a continuation of control climbing labor costs. The de- | the blue chips based on past per-
h= " boom of all time for the American | the tug of war between inflation fense buildup will maintain hiring | formance to be replaced by a new |
d- economy. However, “trees do not | and deflation in 1967. Tight credit, pressure in some industries; but | aristocracy of super-able manage- \
| grow to the sky.” Already, signs of | and increased productive capactiy even more activities will be wielding ment, based upon hopes of good fu-
in 1 deterioration in the expansive vigor | resulting from the flood of business the paring knife. I forecast that the | ture performance. RIB WHOLE
1g {that characterized the earlier phase | capital expenditures in recent years, net result will be a rise in unem-| 49 1 forecast, however, that 1967 PORTION C OR C
rt of the business upsweep have been | are deflationary. However, I can ployment next year. : | will still hold many dangers for the (Sliced 'Lb. 39c EITHER
m | increasing in 1966. Hence, the out- see no substantial relief from the 26 1 do not look for price and’ gpeculator. I urge readers not to HALF
| look for business and finance in| inflation in labor and other oper- wage controls in 1967, unless our borrow money to buy stocks, and I 7-FULL Lb. NO CHOPS
: | 1967 is of greater-than-usual im- | ating costs. In short, we car have defense expenditures rise far above, urge investors to buy for growth RIBS . Lb. {
_ portance. | “cost-push” inflation co-existing what is now contemplated. {and basic investment. valies. " REMOVED! :
© Lest readers of this column be with deflation. ; ; | 27. An encouraging aspect of the| 43. The safest kind of long-term (Last Yrs. Price 49¢) (Last Yrs. Price 69c¢)
| tempted to “push the panic button”, iL A key factor In the business 1967 outlook is the affluence of | bonds are available now at prices ° J
3 © however, let me state that it would | and financial outiook for 1967 iS onsumers. I forecast a further up- | affording very close to the highest Va Pork Loins 9 to 11 Chops 59¢c ALL AGP Super-Markets f
Wy be unwise to expect a major de- taxes. With defense outlays climb ward ‘trend in personal incomes,.! income returns of the century. It «+e.o in Package ..... Lb. WILL MAINTAIN ' {
ro | pression in 1967. Our greatly ox ing, T look to 8.50 m corponate due to higher wage rates. However, lis a good bet that there will not OR Re Store Hours 4
os ‘panded economy still has a consid- and personal taxes in 1967. More- if taxes are raised, take-home pay be so many top-grade issues cn the Center Cut Pork Chops ROASTS Lb 79¢ & :
! erable degree of momentum. The | over, I forecast hat various loyles may not show a rise commensurate | bargain counter at the end of 1967. : Taurs. thru Friday
spotlight on 1967, therefore, should | at the state and local levels will with the gain in gross pay. | Should the 90th Congress boost in- 9 Saturdé Open Till 6 P.M !
focus upon those factors which are | continue tc increase. ; il in | COme taxes, tax-empt bonds will put 7 N y Nn
ve pou y ! : 28. Retail trade held up well in ) 4 nd ; Closed Mon., Jon. 2nd
likely to cause a breathing spell 12. The tightening tax squeeze on on the best performance. Fresh Frying or Broiling Domestic . . . READY TO EAT or .
ck J AA : 1966, but there was a note of leth- for IN OBSERVANCE OF
Ee in economic activity. Politicians «nd | all fronts will worsen as the year argy throughout the year. The pat- 44. World opinion on the future CA NEW YEAR'S DAY!
Cr labor, leaders have a phobia against | advances. And there will be rising tern is not expected to show much price of gold has blown hot and CHICKEN NNED STOCK UP FOR THE LONG WEEK-END
on ® even] hesitancy in business, and | complaints from both businessmen change in 1967 . .'. with gains in | cold many times in recent years.
x rush "headlong into measures de-| and employees that social security | 3 11-1" volume 1 argely reflecting price Though lately in the shade, I pre- Pp ARTS H AMS
signed to treat a case of pneumonia | taxes are becoming unbearable. |. 4 i) Though consumers will | dict that gold will again be in the ALLGOOD LEAN
| ‘when cold pills would be more ap- 13. Results of the recent elections have more. money to spend, tight spotlight before 1967 is out. 5.Lh $
ae propriate. indicate that the headlong run of erodit high borrowing ate and 45. 1 forecast that the dollar will LEGS Cc Da 4-49 Bete. 2 85 SLICED BACON
1. Although business and finan- the Great Society Program must | higher price levels could Cove soma] Dot be devalued in 1967, but the OR Lb. Can Can =
al Ni cial pggoblems loom large in the pros- | take a breather along with the tightening ob pase shringe: | pound will continue shaky. BREASTS (Last Yrs. Price 4.85) t c i |
¥ pecte®or 1967, T must first warn | economy. Gains scored by the Re- 20 Spending for food apparel 46. Certainly, Congress will be- \ ed N 7 Pk ? Price 85¢ }
r- readers that the greatest danger for publicans have altered the balance And mented meroheidin hd 3 be come more and more critical of KE. 2
" the year ahead does not exist on of power sufficiently to force a more aredies In 1067, Aly contact the looting going on under cover J \ ; \| .
al the domestic front. Surely it will | sober look in public spending. |", oo to og Co gel of the Administration's War on BALLIETS ASSORTED SUPER-RIGHT THIN SLICED BONELESS ROLLED
yn ‘be developments abroad that will | 14. One of the primary reasons spending tudaet, Bon lesare hetive Poverty. The whole program will
‘hold the gravest threat to our coun- | for expecting 2 feceierntion in the ities, vacation, and travel beisublocted o ighter mpevisn FRE LUNCH T |
is try. These could be economic was | €économy 1s the likelihood that » 100,20 raved. 47. Ac 1087)" wears. Along. the |
g- Swell ilitary: or political. | business capital expenditures may | 30. Durable goods may fare sof... bi
well as military Pp Tet Coit. anion of woh well Demand. for: Tole, mpplnriees high hopes for more constructive MEAT
2. 1 foresee no war between the | fe aE i ys lor T at a ~~ | conservative action by the 90th Con- : R A TS
on Kelty oa celerated depreciation guidelines, | color TV sets, and furniture may | s : : ;
United States 20d Ramesh I A967. and suspension of the tax credit | be hampered by tight credit and gress will igive Way, fo Incrensed Bologna, Pickle,
However, tensions between the IW | bacon catia i ne Wl a FEIgh borrowing <dsts, plus to othe doubts as a legislative stalemate de- 15-0z. Cc Plain, O'd Fash- 6-0z. C
world leaders may seem to reach > a b oe L ph Jhunve roy i Tew iy building velops. Republicans will have enough C ioned & Olive Pkg Lh. 719¢
the breaking point as the Kremlin | i - stac es iti / By f Rast o decline in new | Strength to stop the most liberal "l Loaf ,
Se Bl ”» ; Svar: | . Except in defense industries, : : gelne ew: | ind ; :
“goes all out” to create diversions | 1 = Rhian or, | auto salon’ However with hot tne Administration bills, but not enough \ 7 \ 7 7
to our efforts in Vietnam. Look for
Moscow to throw salt on festering
wounds in the Middle East, Africa,
and Germany.
3. T am hopeful that a direct clash
between Red China and the U.S. can
be avoided in 1967. Internal dis-
ple; but pressing problems of low
productivity, plus the demands of
her nuclear program, should restrain
Red China from direct attack upen
the United States.
4. The struggle for leadership or
the glmmunist world camp will con-
tinue unabated throughout 1967.
Full political attack will be mounted
bymthe Kremlin against Peking. It
\® be touch and go, however,
whether Russia can persuade her
wavering satellites to sign a final
manifesto reading Red China out of
the Party.
5. Recent. elections ‘n West Ger-
many have formed the embers of
nationalism into a tiny flame. This
has surely thrown a scare into Rus-
take a harder line against Germany
in 1967 than in some time. I feel
that we should particularly watch
General de Gaulle, who ig slaying
closer and closer to Moscow from
ation at this time; hence my forecast
that the smoldering conflagration
there will not erupt into World
War IIL.
7. While all reasonable people are
sensions are rampant throughout |
sian leaders. I predict that they wiil’
‘hoping for a genuine peace in Viet- |
ing 1967 from a business policy of
inventory accumulation to one of
inventory liquidation.
16. I forecast that scarcity of
credit will continue to be a problem
with which business must contend
in the early part of 1967. The money
17. However, I do foresee enough
of an easing in credit to permit
more orderly monetary conditions. |
If the economic situation falters
badly, money rates will, of course,
move downward sharply.
18. I preiict that commercial
and industrif]l building will trend
lower in 1967, reflecting the taper-
ing off in capital outlays.
19. Mortgage money should re-
main scarce in 1967. Hence, resi-
dential building should see another
disappointing year.
20. 1967 opens with the building
of single homes in a state of crisis.
Starts are down over 40% from
year-earlier levels. As a result, I
forecast that the Administration will
leave no stone unturned to stimulate
construction of houses as soon as
possible. At best, however, it may
be midyear or after this important
part of our economy can contribute
much strength to over-all business.
struction should enjoy a fairly good
year; the emphasis will be on dams,
bridges, and water and sewer sys-
tems.
23. The expected declines in resi-
dential building and in commercial
industrial building notwith-
and you reach
crease in the population of driv-
ing age, and with the record rate
of personal income, new car sales
could hold within 10% of 1966's.
32. Soaring living costs will hit |
the headlines more often in 1967. |
Ire will be directed most strongly |
of living, I predict there will be |
many signs of deflation in the, midst |
of inflation. Chief among these will |
be sliding profits, rising bankrupt-
cies and foreclosures.
34. Industrial commodity prices |
should be firm to slightly higher. |
Selective price markups will be nec- |
essary to offset wage hikes. i
35. Profits began to wobble in|
the final half of 1966. I am con- |
vinced that hesitancy will give way |
to decline during the year ahead. !
Big squeeze on margins will come |
from soaring costs, especially labor. |
36. But profits results will also!
vary widely from one company and |
volumes sag, hold, or advance. For
example, T am willing to ‘‘stick my |
neck out” and say that oil com- |
panies will enjoy a sales rise, but |
that the auto makers will be strug-
gling with a volume slump all year,
37. The ¢ombination of less vig-
THE DALLAS POST, THURSDAY, DECEMBER 29, 1966
to launch a program of their own.
48. There will be a lot of talk
in 1967 about the economy’s still
growing”. But I warn readers to
examine carefully the advance in
Gross National Product which I am
forecasting here. Biggest part of
| the increase will come from higher
helpful. The prolonged prosperity
has bred waste, laxness, and in-
efficiency. These can be corrected
only by a return to fundamentals.
Just as the human body requires
adequate rest in order to enjoy
proper health, so too the economy,
and the stock market as well, must
undergo periodic resting phases.
50. As the economy cools off in
1967, readers should beware of
reassurances that our problems are
only temporary and will soon be
followed by a decade of boom con-
ditions. The promised land may be
only across the river, but it is al-
ways wise to test the depth of the
water before wading in. That is be-
one industry to another, as sales ping my forecast that 1957 will be
a good year for businessmen and
investors to have strong confidence
for the future, but to proceed with
caution and restraint until the un-
certainties just ahead have been
resolved.
The Dallas Post
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i month to month. 21. Although new housing starts | orous business, pinched profit mar- fa 101 C 5
1 6. Heavily ' armed with Soviet’ may remain in the doldrums for | gins, and stringent credit conditions Tablcids =- Circulars 2-0Z. C at. C 2-1b. C /
5 walons, the Arabs of the Middle most of 1967, I confidently forecast | points to an increase in business ; Jar tT dar Pkg.
wit: —squared off ‘against Israel— that the year will see the beginning failures, shaking out the financially In Many Designs
5 present a grave threat to world of a great boom in the construction | weak and inefficient. \ . LN rN
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NES i ¢ that Russia or the United 22. Despite President Johnson's y YUKON CLUB BEVERAGES 1 17.0 89c¢ EXCEL MIXED NUTS VACUUM yee i
XY Eo can afford a direct confront- | request for cutbacks, public con- 5
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