The Washington times., 1901-08-06
business Conditions in Europe.

| pie OF nicaragua ana costa t(lca VII
be likely to promote the cause.
business Conditions in Europe.
Trade reports from Europe indicate
! that business conditions there are faI
| from being satisfactory. This is not
| ably true of Great Britain and Ger
| many, the two leading Industrial ma
tions. In Germany there is said to be
an all-pervading weakness, while in
London there is general stagnation.
Both in Great Britain and on the Con-
tinent there are gloomy forebodings as
to the future, and all sorts of reasons
are given for taking pesslmistic view
of the situation. There is no doubt that
| several months ago Europe expert
enced a severe reaction from the busi-
| ness boom, which set in there about a
| year before it struck us. 9There We're
reasons for it, of course, but il is not
so easy to specify them in detail
The worlds business generally runs
| in cycles consisting of aHerna ting, but
irregular, periods Of prosperity and de-
preston. Something occurs to give an
impulse to business and up it goes.
When Il boom is on, everything for a
time contributes to strengthen IL Men
imbibe the idea that the upward move
ment will continue indefinitely, and
this confidence maintains and for a
time accelerates the movement. In
fact. 4 boom" is generally a manifes-
tation of over-confidence. But conf
dence alone cannot sustain business
permanently. After while some peo-
pie become distrustful. Business con-
Germs that have been conducted with
too much confidence and not enough
capital come down with a crash, and
then there is further loss of conf
dence. In boom seasons there is gen.
orally an over-stocking of the mar
kets. The factories turn out more goods
than the merchants can tale, while the
merchants themselves usually lay in
more goods than they can sell. The
result of this is not, as a rule. a panic.
but a period of depression.
When business takes downward
turn the increasing loss of confidence
continues the downward movement,
until something Of a substantial ma
ture occurs to check, it.y Thus. the dis
covery of gold in California and Aus
tralia about 1S49 and 1850 gave a ire
mendous impetus to business, which
lasted until 1873. Then came a turn of
the tide, which many of the worlds
ablest economists have ascribed to
the demonetization of silver. At all
events it continued with only tempo
II
when Europe experienced a revival
This change came just at time when
the mines of South Africa had reached
a point in their production that very
materially affected the worlds supply
of money; and it is another remarkable
that the European boom
was checked almost Immediately after
war. Since then complaints from Eu-
rope of unfavorable business conditions
have been almost continuous.
At this time many of the leading in |
dustries of Germany are seriously af- |
fected, and the country has recently |
had some very unpleasant banking eX- |
periences. The money market of Ber-
dition for months, and only a short |
time ago it was considered to be posi- |
lively critical. All in all. the outlook |
in Europe is not as bright as we could /
wish. 1t is impossible for us TO know
how long the depression will continue, |
or how much 1t will affect US. We can
not reasonably expect to escape entirc-
ly, for our commercial relations with
Europe are very close. Unfortunately,
too, our own industrial skies are not
entirely free from clouds. The bust
ness situation is by no means as strong
rs it VAS a year ago. and while it is
not necessary for us TO borrow trouble,
it is well FOR us to take a conserva-
i've. common sense view of the matter,
and put our house in order for any
storm that may chance to veer around
his way.