The Topeka state journal. [volume] (Topeka, Kansas) 1892-1980, 1903-10-22
OUR MONEY.
Continued from Page Five.)

,
iod of extravagant living and working
and prices of all kinds are high. Tt
takes mole money or credit which is
what is used in business. to do the same
volume of business. What is more seri-
Gus, vast amount of this lOaning ca
pacity has gone into fixed Improvement,
which are either unproductive or very
Slowly becoming productive. There is
one field in which the lOaning power has
been absorbed. which is not SO fully ap
preciated because there are no figures
to show it's amount and the facts are
not so widely known; and that is in the
purchase of farming lands. 1t has been
very largely a movement from some of
the older western states, where the prices
of farming lands have become compare
lively high into the states further west
or into Canada, where man can buy
two or three. or even five or ten acres
of the cheaper lands for the selling price
of one acre of his old farm. This move
ment has not only taken accumulated
savings out of the older communities, but
large sums have been loaned to make
these purchases of lands. This is a very
important factor today in many of the
middle western states. 1t is not an I'M
usual thing to hear from local banker
or from a bank examiner that fifty to a
hundred thousand dollars has thus been
taken from a small town. and the total
amount of this must run up INTO many
millions of dollars. Much OF the loaning
power of the western banks has been
thus absorbed which was formerly used
in the purchase of brokers' commercial
paper and loans on collateral in Chicago
and New York. Another large proper
ton of the loaning power is absorbed IN
carrying increased quantities of old and
new securities, some of them OF more or
less doubtful value. This is the situa-
ton which has called a halt and set us
all to thinking, not the lack of Aon-
paratively few millions of currency 10
move the crop or the accumulation of
the surplus in the treasury. OF course,
those are factors of great Importance,
but they are not the leading or cOntroll-
ing factors in this situation
The power to loan still exists; the
money is still in the banks for reserves,
and there is as much money as ever in
circulation outside of the banks and the
treasury. The question now is not so
much the power as the disposition or
Willingness to loan. How far will the
these loans? That is question for
the bankers mainly to decide For
about a year there has been a steady,
almost uninterrupted decline in the
prices of all stocks and bonds. 1t has,
however been so comparatively grad
ual that there have been no bank fall
ures, and very few stock exchange fail
ures as the result, and so far general
business has not been seriously checked.
From a strictly bankers standpoint, his
situation has been in one respect much
| improved However hard it has been
on those who have made the losses, the
bank loans on stock exchange collateral
are row readjusted upon the much low
er basis with at least as much margin
and probably more than on the higher
range of values. break in prices
which, if a banker knew it was COM
| ing would be very terrifying, is now
past and the banks have not been hurt
! by it. The explanation of this is that
most of the people who have made the
/ H. - lose rr-f<1 114r
losing the money of the banks. Many
! of them made it on the rise in prices
and only have given up part of the
profits. There probably never was
| time before in the history of the coun-
| try when such a decline in stock prices
| could have happened and found the
people so well prepared for 1t and the
whole country with such powers of re-
sistance and recuperation. We are in
an entirely different condition and this
| is what gives such foundation for hope
and firm faith in the future. The way
business has stood the decline in stocks
| is an evidence of strength. not weak
ness There may be and doubtless will
be some hesitation and curtaiHng of
other lines of business as the result, but
there is no occasion to be nervous or
historical about it,; we should keep
cool and where our calm judgment an
proves be bold and coura geous. If We
have been too hopeful. do not let US
all at once become too ~aeSsimiStic. Let
each bank stand by its customers and
stand by the country, as it deserves. 1t
never was in better condition when
facing any such situation.
| Contrast the position of the railroads
today compared with a few years ago,
when more than one-fourth the mileage
and many of the most important lines
were in the receivers hands You have
no more of railroad receiverships. The
roads are on an entirely different pasis
The country has filled up so that they
have vastly increased volume OF per
1 ofT.f aoIpc
and organization are SO improved that
they can handle their business far bet
ter than. ever before. There. is no COM
parison which can be made of the con-
dition of the country today with what it
was only a few years ago, which does
not show the surest foundation 70. err
during prosperity and there is no part
or section of the country of which this
| is not true
| During the last ten years the balance
LOT trade in favor of the United States