Tired Of All The Cry Babies On This Site

Discussion in 'Economics' started by EMRGLOBAL, Aug 18, 2011.


    The game of any fool making money is over. You have to choose your industry and your profession wisely now. Monkeys in cubicals, traders in Bucket Shops, wana be capitalist in industries not well positioned are going to suffer. HOWEVER: You can make a lot of money right now if you really position yourself in the proper industry.



    To begin, not all was gloom and doom during the Great Depression. It
    was a time when those who knew what they were doing made great
    economic strides and the very nature of the depression itself was an
    economic boon for them. It was a time when several companies
    benefited from aggressive marketing while their rivals cut back. A
    good example of that would be Kellogg besting C.W. Post during that
    time. Consumers didn't totally stop spending during the depression,
    most just looked for better deals and the companies providing those
    better deals came out stronger after the depression ended. When
    spending picked up, consumer loyalty to those companies remained.

    To state a generality, those companies who not only survived but did
    well and grew during the Great Depression are those who continued to
    act as though there were nothing wrong and that the public had money
    to spend. In other words, they advertised. These are industries who
    didn't wait for public demand for their products to rise, they created
    that demand even during the most difficult of times. Because so many
    companies cut spending during that era, advertising budgets were
    largely eliminated in many industries. Not only did spending decline,
    these companies actually dropped out of public sight because of short
    sighted decisions made about spending money to keep a high profile.
    These advertising cutbacks caused many customers to feel abandoned and
    associated the effected brands with a lack of staying power. This not
    only drove customers to more aggressive competitors but caused a
    certain amoung of financial mistrust when it came to making additional
    investments in the no longer visable companies.

    Both anecdotal and emperical evidence support the case that
    advertising was the main factor in the growth or downfall of companies
    during those years. To put it bluntly, the companies which
    demonstrated the most growth and which rang up the most sales were
    those which advertised heavily. The Great Depression offers classic
    examples of the power of brand advertising even during times of
    economic crisis.

    Proctor and Gamble - This is a company which has a philosophy of not
    reducing advertising budgets during times of recession and they
    certainly did not make any such reduction during the Depression. P&G
    has made progress in every one of the major recessions and that is no
    accident. When their competitors were swinging the budget axe, P&G
    actually increased their spending. While the Depression caused
    problems for many, P&G came out of it unscathed. Radio took P&G's
    message into more homes than ever.

    Chevrolet - During the 1920s, Fords were outselling Chevrolets by 10
    to 1. In spite of the Depression, Chevrolet continued to expand its
    advertising budget and by 1931, the "Chevy 6" took the lead in its
    field and remained there for the next five years.

    Camel Cigarettes - in 1920 Camel was the top selling tobacco product.
    American Tobacco Company then struck back with the Lucky Strike brand
    and by 1929 Lucky had overtaken Camel as the number one brand. Two
    years later in the heart of the Depression, Chesterfield also overtook
    Camel. Camel countered with a massive increase in advertising
    spending and by doing so demonstrated the power of advertising during
    depressed times. By 1935, it was back on top.

    Now, these examples count as anecdotal. But in addition to these
    examples, studies have demonstrated that during times of recession,
    companies that maintain advertising during these periods experience
    higher sales and profits during the downturns and afterward than
    companies who cut their advertising budgets.

    It was also the very nature of this advertising that spurred the
    growth of two other industries during the Depression. The first of
    which was radio broadcasting.

    Let's return to Proctor and Gamble for a while. P&G first turned to
    radio in 1923 advertising Crisco on a New York station. Other
    products such as Ivory and Lava soap were advertised on 'product
    oriented' shows which were similar to todays infomercials. But in the
    heart of the depression P&G took a step which changed not only that
    company but the broadcast medium forever while creating great demand
    for its products. The president of P&G at the time was Richard
    Deupree. In spite of the fact that shareholders were demanding that
    he cut back on advertising, he knew that people were still buying
    essential household products. So he created radio programming that
    did not focus on a product. Because of that, we now have a cultural
    attribute known as the "soap opera."

    In 1933, P&G went on the air with its first "soap" - "Ma Perkins,"
    sponsored by Oxydol. P&G was so satisfied with the increase of sales,
    they went on to introduce "Vic and Sadie" for Crisco, "O,Niells" for
    Ivory Soap and "Forever Young" for Camay. By the time 1939 rolled
    around, P&G was sponsoring 21 radio programs and they doubled their
    radio advertising budget every two years during the Depression.

    Radio was one of the fastest growth industries of the depression. P&G
    virtually built daytime radio with its advertising budgets and
    programming. Two industries were thriving from the advertising budget
    of one.

    The print media was also a growth industry during the Depression. To
    give some reason for this, we now return to Chevrolet. the first ads
    for Chevrolet appeared in print in 1914. In 1927, they began to
    increase their print advertising budget. As the country moved into
    the Depression a couple of years later, Chevy did not let its
    commitment to print advertising falter and its car ads not only kept
    some publications afloat, it helped many to grow. In as much as the
    term "print media" covers many outlets, they pioneered the outdoor
    advertising medium, billboards. Chevrolet also went into radio and
    sponsored such Depression Era classics as Fred Allen and Jack Benny.
    Chevy's print ads appealed to the "emotional" side of a buying
    decision which was a great move in light of the economic uncertainty
    of the time.

    So once again, those companies which took advantage of the Depression
    and came through in good form were those who kept their name in front
    of the public in spite of a lack of purchasing power.

    Your question asks about a hierarchy of demand from essential
    consumables to deferrable purchases to capital goods. In reality
    there was no such hierarchy. I have tried to balance the examples
    given to show some spectrum across the board. Proctor and Gamble
    represents essential consumables, Chevrolet represents deferrable
    purchases and Camel represents non-essential products. So as you can
    see, the so called hierarchy of necessity and want was sidestepped by
    those who had the marketing gumption to ignore such distinctions.

    However, capital goods information needs to reflect the entire
    economic structure of the Depression and not just those companies
    which were successful. Overall, new production of capital goods less
    capital goods consumed during the years 1929 - 1939 was near zero.
    The increase in the money supply during the 1920s also increased the
    prices of capital goods relative to the prices of consumer goods. This
    disparity set in motion a boom in real estate and stock market prices
    and interest rates were driven down by the "increase in Fed money.

    It must also be noted that the preceeding statement on capital goods
    is only one of many competing economic theories about the Depression.
    There are some who say this compounding of assertions is wrong from
    beginning to end. But in composing an answer such as this, there
    needs to be one which best meets the nature of the question and in
    conjunction with the material about public visability covered above,
    this is the one your researcher ties into the equation.
    When money has entered the economy from whatever sources during
    business fluctuations in the past, has there been a disparity between
    the increases in prices of capital and consumer goods? That alone is
    a subject which would take volumes to answer. In fact, it would take
    volumes just to cover the debate without any resolution coming about.

    As far as the end of your question as to what distinguished the
    companies that did well during the Depression? They were the
    companies that kept their name in front of the public and created
    brand name recognition even during the worst of times.
    Search - Google
    Terms - great depression, company growth great depression, great
    depression success stories, brand name awareness great depression,
    advertising history, new industry great depression, benefits of


  2. So does this mean you're getting off welfare?
  3. EPrado


    So let me get this straight. The biggest whining crybaby ever to post on ET starts a thread "Tired of all the Cry Babies on this site".

    Hilarious coming from the record spinning failed trader who never shuts the fuck up on here.

    For a guy so successful he sure whines a lot.