#98 Stock Market Wizard: Roger Babson

“More people should learn to tell their dollars where to go instead of asking them where they went.”  Roger Ward Babson, economist


Mr. Babson is a  Splash temperament type with a fixed Cosmic Grand Cross in his chart making him very persistent with things.  We rectified his Ascendant to 10 Sagittarius,  giving him a noble and honorable character with great self-confidence.  It is a common fire sign ruled by Jupiter, that is found in his tenth house of career and outward purpose.  Sagittarius is also the sign of the “gambler” though it is doubtful that Mr. Babson would have thought of him as such, with his Saturn at 26 Cancer in the second house, but most think of investing as a form of high-stakes poker.

For Babson though, investing and market forecasting was a science, and a statistical one at that.  Saturn in the second house is in its essential house, which helped him take an obscure mathematical construct used before him for crop reports, and make it into an advanced quantitative tool for analyzing numerical facts.  Sextile Neptune in Taurus in the fifth house of creative offspring, Babson was able to take those ideas and make them something concrete and useful.  Pluto is also in the fifth that gave him impetus to tie his name and standing with his invention thus making it integral to his identity (Pluto is also trine his Part of Fortune).

Babson married twice.  The first time for 56 years and the second for a little under ten.  He had no children and many think that Neptune in the fifth house denotes that, but he did leave lots of honorary children through Babson College.  It is quite impressive, click here on Wikipedia to read the list of illustrious alumni.


Roger Ward Babson was bron in the seagoing town of Gloucster Massachusetts and was educated as an engineer at Boston’s MIT.  It was during a bout of tuberculosis that he taught himself statistical analysis.   Realizing that statistics was an unknown field, he bought a typewriter, and developed a market index based on Newton’s law of action and reaction (lower prices must follow higher prices and vice versa).

  • In 1904 he founded the Babson Statistical Organization, Inc., whose business and financial statistics, published in Babson’s Washington Service, were sold in the United States, Great Britain, and Canada.
  • In 1919 he established Babson Institute (now Babson College), in Massachusetts, and in 1927 he founded Webber College, in Florida.
  • And in 1929 he was the lone wolf who called the Stock Market Crash and publicly announced his findings in the New York Times on Friday, September 6th, 1929.  His great competitor, Irving Fisher, disagreed.

Wise investors will pay up their loans and avoid margin speculation at this time because a “crash” of the stock market is inevitable. Roger Babson, statistician, said today before the sixteenth National Business Conference at Babson Park, Wellesley.

What of the future?” he went on. ”Sooner or later the stock market boom will collapse like the Florida boom. Some day the time is coming when the market will begin to slide off. sellers Will exceed buyers. and paper profits will begin to disappear. Then there will immediately be a stampede to save what paper” profits than exist.”

Investment trusts will first bcgin to sell. They have so broadly advertised their paper profits & will very anxious to cash in on them. ‘

“As-soon as word gels abroad that the large American investment trusts are selling, the European houses will begin to sell out their customers who are now buying in the American market.

The general public will then follow with a desire to cash in. then margin. accounts will be closed out, and then there may be a stampede for selling which will exceed anything that the Stock Exchange has ever witnessed.

One thing more to remember: Thus far there has been few. deaths among those with very large stock holdings. Before. long these. men will begin to die. and their holdings will be put on the market. This especially .applies to: public utility stocks.” Mr. Babson advise investors to buy bonds, but was bullish on gas stocks

In 1940 he was the Prohibition Party’s presidential candidate, polling 57,812 votes (the highest it ever got).  The party got started out of the temperence movement of the previous century and was founded in Michigan by John Russell, Methodist preacher, in 1869. Though women in the USA did not have the right to vote until 1920 when it was signed into law by President Woodrow Wilson, the Prohibition Party allowed them to be members and vote at their conventions.

Babson was the author of many books on finance and investment, among the best known of which are Business Barometers (1909, 10th ed. 1961), Investment Fundamentals (1930, 4th ed. 1948), and If Inflation Comes (1937).


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