New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1902-09-19
INDUSTRIAL GERMANY
ro1n WATER TREATMENT AFTER 4
SPECULATIVE DEBAUCH-ORGAN AMI
ING THE HEAVY BATTALIONS-
INTELLIGENCE DEPARTMENT
AND SCOUTS.


Berlin. September C.
c,15 water IS wholesome, but not a stimu-
,+i1e regimen after a protracted devotion to
.heronagne and brandy. Germany is slowly
towering from the debauch Of speculative
.,,-, which was brought to end when one
- the most heavily embarrassed banks sus-
aa5 business For two years there has been
: General liquidation, and it is about half
eisbsd The banks which have been financing
Electrical industrial and building enterprises.
ore still heavily loaded with unmarketable Sc
,,;es. but they have changed their methods
rb,siness. and are now conducted with caution
.,a conservatism. During the imitation period
;ndustrial promoters formed their projects, and
~. hanks eagerly took them UP and recklessly
ananoed them. There are abundant reserves OF
Genital and money has been cheap for a long
,-oo. but the banks warned by recent expert
.,oe have required securities OF unquestioned
1alue before making advances to companies new
~ old The times have changed since the speCu-
lative period. when few questions were asked.
snd the capital supplied for every fresh
undertaking. German bankers have learned
cau+ion and self-restTaint. and with adequate
safeguards they are enabling the legitimate
business interests 10 right themselves When
+he process Of liquidation is completed by the
survival Of the fttest industrial companies
Germany will have q greatly reduced plant for
doing her own and the worlds work; hut il will
also have a banking system conducted with
English caution and sobriety Of judgment.
The curative qualities Of cold water after ex-
cessive stimulation operate slowly. There have
been tNro wears of commercial depression. and
long = period will be required before recovery
&c complete. A clearance Of unnecessary and
unavoidable companies is indispensable in nearly
every important industry, and this has barely
begun A group Of electrical companies was
financed by the banks when speculative activ-
ity was at its height and hundreds OF projects
for the installation Of mechanism for municipal
and Industrial purposes were undertaken. The
bulk Of the stock received by the companies in
various enterprises has deprecated. The truth
is gradually coming to light and enormous losses
from insolvent accounts are admitted. Some OF
these companies which promoted scores of
schemes for electric plants at high prices. will
be forced TO wind up their business. Settlements
viii be effected under pressure from the banks.
and when the unremunerative business has been
closed out margin Of profit for really sound
companies will remain. When liquidation has
been finished Germany will have the best cleo
trio plant in Europe. and will be surpassed by
the United States alone in improved mechanism
of this class. A good many electric railways
will be in advance Of the requirements of traffic.
and many bad investments will have been made
IN the storage battery traction system. but the
general electrical equipment of the municipal
ities and factory villages will be Of the highest
efficiency. and there will be well managed COM
panies capable Of taking contracts from foreign
countries and competing vigorously with Ameri-
can enterprise.
A similar process of liquidation Will be re-
CURED for various industries overstocked with
machinery, and unable to find a market for their
products The cement trade offers an effective
illustration. This is an industry for which Ger
man habits of thoroughness and scientific accu-
racy are peculiarly we'll adapted, and II has ad-
vanced by leaps and bounds during recent years,
until every foreign market has been invaded and
conquered. During the imitation period a large
number Of new companies were formed. and
enormous investments were made in machinery
of German and American manufacture. The
facilities for increased production and supply
were carried far beyond the possibility Of do
nestle and foreign demand. When this equip
rnent for grinding and making cement for
Europe and the world was completed building
operations ceased in Germany, and improved
processes of manufacture were introduced in
The United States. The home market was over
stocked, and the foreign demand slackened. and
the industry. with its vastly increased resources
for production ceased to be profitable The only
effective relief measure for the trade is the
winding up of many of the new companies
which we're formed under the illusion that mar
kets could he created as easily as a project
for supplying plants at high prices could he
financed Many other industries are suffering
from overdevelopment of their resources. The
conditions Of supply which have been artificially
manipulated by company promoters and reck-
less inanciers must be gradually readjusted
10 the actual requirements of the home and for
egn markets The unsound and superfuous
companies must be closed out, and the ground
cleared for the development Of remunerative
industries
The deliverance of Germany during two years
OF storm and stress has been worked out largely
through the export trade. This has been kept
under systematic control through the Industrial
cartels and employers syndicates, so that there
was something for manufacturers and shippers
to live upon when domestic trade was stagnant.
The steadiness Of the export trade has been re-
markable since the collapse Of speculative activ-
lty; and until the end of last year it was re-
munerative business, without cheapenng Of
prices or sacrifice of values. During the last
SIX months there has been an enormous addi-
ton TO the volume Of exports without corre-
spending increase in values The shipments of
pig iron and steel to the United States have
been large, and have been made at low prices
Two prominent merchants here have described
them TO me as a godsend to Germany, since
surplus stocks of metal were sold out at a time
when the domestic market stagnant, and
when iron and steel workers were in urgent need
Of employment 1t is. at least, striking Illus