Evening times-Republican. [volume] (Marshalltown, Iowa) 1890-1923, 1902-08-16
INDUSTRIAL REACTION.

/ INUUSlhlAl heAC lUfa.
The bright prospect for an enormous
corn crop and encouraging reports OF
the same good promise in the cotton
country makes every business man $
pulse beat quicker and his heart to
/ Weigh lighter. Corn and cotton are the
great staples in this country. With
| plenty OF each we will have something
! to export, and with exports we prosper.
| However there are other conditions
that appear as clouds upon the COM
lmerical horizon which should be viewed
by business men as words OF warn
ing.
When such men as the experienced
seers of Henry Clews' banking house
see danger ahead their words are we'll
worth considering. a member of the
presidents cabinet has recently been
quoted as warning the country of its
great danger from any disturbance of
industrial conditions because of the
enormous sums of money loaned out
on the bonds of corporations. The
slightest jar to this structure. in his
mind, would set one industrial topping
over against another and bring on COM
mercial ruin. Go TO the farmers he
says. and they will tell YOU they are
money is and they will point 10 the To-
cal banks. Ask the banks and their
officers will tell you money is plentiful
and reserves above 40 per cent. Where
is their money? 1t is in Chicago. Go
to Chicago. Same story. Banks all
right Reserves 50 per cent But the
money is in New York In New York
you will find that both deposits and
loans have been enormous. but the
money is not in the banks. You want
to know where the money is? We'll.
s45o.ooO. 600 is loaned by national banks
on the bonds of individual corporations.
Here YOU see where S450.0o0.o0o of the
country's surplus stands against lot
of undisested, promotion produced Sc
curities.
AS the cabinet member observed in
conclusion, 1T is all right so long as it
is all right" yet. returning to the view
point of Henry Clews, the preparations
for reaction are already in progress.
on Monday last Ciews observed: 1T
seems quite probable that the ability
of manufacturers to advance wages has
that advances in wages now mean still
higher prices for products, which are
impossible without curtailing produc-
tion." That same day the columns of
the daily press We're filled with reports
of strikes and labor disturbances in
many cities.
Employers in Iowa have said that
their wage scales this season have been
higher than ever before. and yet there
has been more uneasness among their
men than at any previous time. The
same conditions prevail elsewhere
High prices in themselves force wage
earners TO demand higher pay, which in
turn necessitates still higher prices for
the goods the workman makes. and 50
the process goes on. Sooner or later the
limit is reached. Manufacturers be
come alarmed because OF labor troubles,
new enterprises are held in allegiance,
old ones cut down their production to
reduce expenses rs profits grow less
and labor employment is curtailed.
This in turn reduces consumption ana
less production is needed. Thus pros
perity comes down by the same alter
rating hitch and shove, notch by
notch process that sent it up.
The important point TO be remem-
bered by business men, and wage earn
ers. too, if they will, is that experienced
prophets such as Clcws believe the
ability of manufacturers to' advance
wages has about reached its limit If
this is true the strikes and ockouts.
which all of us know are 10 follow,
since the workman can not. any more
than any other man, be expected TO
know when he has got all there is for
him TO get until he has tried, are des-
tined to be disastrous TO present con-
ditions. For this reason" Clews says,
the strike fever can not be regarded
with the equanimity that would be pos
sible if prosperity promised unknown
continuance" These words are the
words of financial writer whom
bankers thruout the west LOOK upon as
very conservative and far-seeinG in his
predictions. He believes Eve are near
er a reaction in this part of our econo-
mic machinery than is generally sup
posed" With enormous land booms on
in the west, the $4500O0.000 tied UP in
industrials in the east, with laborng
men uneasy everywhere, it becomes the
act of wisdom for investors to go SLOW
for borrowers to go slower, and for
lenders to go slower still. We should
all prepare for reaction by judicious
conservatism, and perhaps the reaction
will never come.
Another American Invasion.
[Chicago Post1
During the last five years $4,000
l., 1,al \