The news & observer. [volume] (Raleigh, N.C.) 1894-current, 1902-11-23

NOuUlIy HAVE DBcH StIlOuS OfeI Tie I'LL
ancial outlook for some weeks. Some
have feared that the liquidation, certain
TO como as the water is squeezed out
of the boom stocks, would be sharp and
sudden, producing a panic. Others be-
iieve the strong financiers will be able to
prevent trouble and tide over the period
of liquidation by making it slow pro-
cess, thus preventing anything like
panic. The United States Investor, one
of the ablest papers of it's class in the
world, gives an elaborate review of the
financial situation. 1t is so valuable that
We publish it full below:
The evidence is cumulative that the
boom of the last five years is over,
and that readjustment of values on
materially lower level than the present
is inevitable. This remark is intended
to apply not only to stock market spec
ulation, but to Industrial activity as
we'll. 1t is no doubt disagreeable to
have to admit that we have reached the
turning point in our prosperity, but there
Is far more to be gained by SO doing
than by refusing to look the facts in
the face. Refusing to admit the posi-
bility of an impending evil is trait
which intelligent foreigners have long
since discovered in us. This unwill-
insness is not easily accounted for:
possibly it is due to the buoyancy of
conscious strength, to sublime faith in
our ability to overcome all evils as
they arise: but possibly it is due to
sheer ignorapce, to a crude and child
ish business instinct on the part of
the American people. Be that as it
may, the fact remains that, as a ma
tion, We are always slow to recognize
approaching danger, and are consequently
the nose surprised people on the face
of the earth when disaster OF any sort
over takes us. 1t is far from our purpose
to predict disaster at this time; never
tEeiess, it would be the height of folly
TO attempt TO conceal the fact that the
entire material situation in the United
States has assumed, in the comparatively
recent past, a more dubious appearance
than it has worn since the latter part
of 1897. 1t is fondly believed at any
rate there is an assumed BELIEF that
in no event can this nation recede to
such economic conditions as prevailed
between 1893 and 1897. 1t is to be hoped
THAT InlS is Il COFi6cI e5llllldte, DuL II HolS
10 be demonstrated that it is. Such OPP
timistic v1ows are based on the fact that
the currency policy of the nation has
been reformed, and that capital is capa-
bile of more efficient mobilization than
formerly. These considerations are of
course entitled to great weight; but it
must be remembered that the people who
talk in the manner just described have
do ct ion iS
as yet lacking. Other things being equal,
a sounder currency policy and an in
creased efficiency or modified capital
should have tendency to diminish the
intensity and duration of financial dis
turtances in the future. 1t is entirely
a question of how far we can rely on
other things being equal. We have more
scientific currency laws than we had
decade ago, but that very fact has had
a tendency to make our bankers less
cautious than formerly. Capital can be
more easily modified at critical mo-
ments but there is some reason to sup
pose that even more progress has been
made in the last five years in over-ex-
tending credit than in perfecting methods
for the mobilization of capital. Every
thing considered, there is room for doubt
as regards the theory that financial dis
turbances in the future will never as
sumo the proportions of those of the
mast However as we have pre-
yio,sly intimated, we have no desire TO
indulge in alarmist predictions at TINS
time In fact. we may state that, per-
sopally. we entertain the hope that the
financial recession which seems to be
before us in the very near future, VIII
not be comparable to the previous nara
times of the last thirty years. That is
cnly an individual opinion. based on the
facts of the moment; day may shatter
such hopefulness, and cause US 10 vie"
the future in darker colors. Inc uh-
certainty springs from the fact thal
there are several copceivable methous
of readjusting the situation, anu no one
is in n position to assert. WIN conn
dence which one will be operative. IL
is of course conceivable the optimistS
whom we have cited above to the con-
trary notwithstanding, that the newt
able readjustment may be accomplished
by means of a terrific crash In Wail
street, accompanied and followed Dy
numerous mercantile disasters. III Is
supposable, on the other hand, that IL
may be brought about by the sclentlhc
application of rapidly modified capltal;
that is, by putting series OIL propS
under the situation until the founda-
lions can be repaired. Or it may be,
that the industrial situation of the ma
tion is. as a whole, sufficiently sound to
be in no danger of a great crash like
that of 1898 or to require an artlnclal
prop; gradual DECLINE in commodity
prices and stock market quotations may
be all that is needed That the boom
will be carried to larger proportions
than have yet been reached, is, in our
opinion, entirely improbable, although
there are still plenty of people who pro-
TESS 10 believe in that outcome
VALUES MUST SHRINK.
While there may be room for a va
riety of opinions regarding the meth
cd by which a REIMBURSEMENT of the situa-
ton to a lower level of values is to be
accomplished there can be no question
In rational minds that the time for re-
adjustment has about arrived. The only
thing that can avert il is a general rise
in wages and sall"ies throughout the
length and breadth of the land, and that