Arizona republican., 1898-05-26
THE EFFECT OF WAR
Finance and Trade Must Be
 Consistent.
The Balance of Trade Still In Our Favor, and Our Gold Basis is Strengthened.

New York, May 25.-(Specia1)- The absence of notable events in the war and the uncertainty attending the movements Of our fleets seeking the Spanish squadron have not been con- duciEe to activity in the Wall street markets. Uncertainty is the most dis couraging influence that affects the stock market and the bears usually do their best to turn it to their account. Besides, the previous large advance in prices and the retirement of some large operators from the arena had somewhat exposed the market to at tack; but, nevertheless, although some securities are lower, the average range of prices shows little change from a week ago. The severe official restraints upon the press in the print ing of war news, in order to prevent giving information to the enemy, has tended materially to check the ex- citement attending military and na- val movements, and this has had the effect of somewhat limiting the amount of transactions; but, at the same time, it has imparted Steadier tone to business.
 An important element of strength has been contributed by the monthly statement of foreign commerce, show ing further large increase in the creditor balance Of our external trade. The April exports of merchandise show an increase over those of 1897 of S21, 77S,0G0, or nearly 30 per cent, while the imports of goods exhibit a de- crease of $45, GOO, or nearly 45 per cent. While, for April, 1S97 there was an excess Of imports over exports amounting to $23, ,673,0 900, last month the exports exceeded the imports by S43, ,502, GOO; so that the April balance is S67 900 more in our favor than it was last year. This is most ex- traordinary movement. Of course, it is out of the question for Europe to con- tinue indefinitely to pay these unprec- edented balances in gold. The effect is to force up the rate Of interest at the European money centers while de- pressing transient investment to buy up export bills on London and other European points. This process, after a suspension of some weeks, is starting up again, with the effect of putting Up exchange to rates which have stopped the importation of gold. At the same time, the high rates for money at Lon don are causing some return of our se-
 
 towards the liquidation of our credl- tor balance, while our purchases of ex- port bills are but temporary postpone ments of the foreign indebtedness and do not avert future settlements through remittance of gold The amount of floating European indebt- edness now outstanding is calculated to keep the rate of interest relatively h ioh in Russia is appearing as a free buyer of the metal; and that fact may be ex- pected to stimulate our local purchases of export bills.
 For the first ten months of the cur rent fiscal year, our gross exports of merchandise and silver amounted to S1 ,072, ,117,OO0; our imports ol the same times were valued at $521, ,O52. 900: which shows an excess of exports over imports, for the last ten months. amounting to s551, ,O65, 900. This bal ance has been set off to the extent of $s4,479,000 by net imports of gold; which leaves a remaining balance of $466,5S6,000 to be liquidated from other sources. The value of returned securities, our interest payments and all the other debtor items combined cannot be supposed to at all approxi- mate these figures; and it therefore follows that, even making extraordi- nary allowances for the return of se- curities, avery large unliquidated bal ance must still remain due to this country-certainly not less than s100,- OOO,OO but more likely a much higher sum. Our financial relations with Flu rope thus stand well protected for some time to come with the result of strengthening our gold basis under the trying conditions of state of war finance.
 It may be reasonably questioned whether any other country has ever made such brilliant record under like conditions, and especially in the