Omaha daily bee., 1902-11-01
METHODS DANGEROUS
Vanderlip Says Finance Plans Must Change
if Industry is TO Grow.
INCREASE OF PAST YEARS HATING
Exports Are Rapidly Decreasing,
while IMPORTS Get BieEer Year by
Year and Gold Reserve
Fails 10 Increase.

WILMINGTON, N. G. Oct S1.-Frank A.
Vanderbilt. sounded a note Of warning in
an address delivered here tonight. without
being pessimistic, he urged a more con-
sentative management Of American indus
try. foreseeing in present methods the pos
sibilities Of future losses and humiliation.
After referring to some features Of the
commercial and Industrial development Of
the country, he said:
l am just back from another European
Trip and FOUND In every capital ana IN the
m faIPs a OF b eImGs tbs efe ws s seSe f6r fSe present 1s s1t
reached the high-water mark of our over
now of. exports into Europe, Instead OF
the credulous belief in the unlimited posi-
bilities of our development OF a year ago,
there IL today a feeling of grave conserva-
tism and anxious interest in our future.
Exports Are Decreasing.
They note that the rapid increase of our
exports came to a halt two years ago.
years have been rapidly rising, the record
for the fiscal year just closed being more
100000 in 1885. They note, too, that in spite
Of the tremendous balance of trade which
government reports showed In our favor
we do not seem to have any unusual COM
mand upon International credits.
IL we are honest we must admit that the
s ses is on on to cur i sIs st,p C OF forelsb hut m tbs
rate of increase which they were making
has been checked, and decreases have been
recorded. Our exports of manufactures
for the year just closed were $5O,OOO,Oo0
less than two years ago. Our total exports
Of domestic merchandise fell of more than
instead of decreasing imports we have
made some large increases In our pur-
chases of foreign goods, and the total for
this year stands more than $500. OOO, coo above
1899.
We have had an expansion of 1890, 900 in
national bank deposits since the beginning
of 1899, while the basis of gold and legal
tenders upon which that inverted pyramid
stands is actually slightly smaller than It
far from 5000, 10000, and there is little
terially larger than at the beginning of
We have had, then, in less than, four
posits of A,OO0.0 900, 600, accompanied by no
Increase in the specie and legal tender
holding of those banks,
Trusts Help Possible Disaster.
The principal reason for the expansion OF
deposits and loans is the movement to ag-
gregate Industrial establishments into
single great corporate units.
Another important Influence has been
the vast expenditures of corporations for
the Improvement OF. their property. 1t
must be admitted, l believe, that we have
liquid capital into fixed Iorms of invest
ment. The cure Is, of course, TO reduce
the expenditures Of that character so that
What is the line of safety? 1t is some
thing we'll within the income from such
Investments. We have the choice of one of
two t~hings-either to practice wise discre-
ton or to go on borrowing on the future.
The first course is consistent with con-
tihued prosperity; the second will bring
whole constructive investment
1 do not wish to present an alarming
view. / wish merely to sound a conserva-
tive note OF warning. l believe there are
elements of possible danger in the sitia-
ton. On the other hand, 4 by no means
forget the long list OF favorable conditions
have numerous acknowledgement over our COM
~petitors and in the end the combined eff
tain to place us 'fofefnost I'M the worlds
Icommercel ranks. z A Jndteious~ reRognition
of the restricting conditions now visible IN
disaster and humiliation later on-a
humiliation from which recovery will be
slow and painful. ."