The Hawaiian star. [volume] (Honolulu [Oahu]) 1893-1912, 1910-08-30
MARKET LETTER
Of HENRY CLEWS
Continued from Page 81

itself manifest in greater business ac-
tivity. At present general trade is
very quiet Buyers have been pursu-
ing a hand-to-mouth policy, and many
establishments in the iron, textile lea
Their and other Industries have been
obliged to materially reduce their out
put. 1t is recognized that the whole
country has entered a stage of over
production, which is due partly to di-
minished purchasing power, and part
ly to an excessive enlargement of pro-
ducing capacity. This readjustment
between production and consumption,
or supply and demand, cannot be i'm
mediately accomplished, but the evil
is fully recognized and the curative
process is now fully under way. AS
already said, the rest cure is working
out beneficial results, and is likely, as
of old, to prove the best restorative
known.
Some uneasiness is felt regarding
the political situation; but it must be
remembered that the actual effect of
politics upon business is generally less
in fact than in sentiment. When eco
nomic conditions become sounder, bu-
siness will promptly rally with COM
paratively little regard to politics. Our
| foreign trade, though showing very un-
satisfactory results for the entire fis-
| cal year, is at last giving signs of re-
turn to the normal Though imports
continue very heavy, amounting to
$117,000,000 in July, or nearly $4,000
900 in excess of last year, exports
reached $114,5OO,OOO, or little more
than $5,000,O00 in excess of the same
month of last year The July exports
have been only exceeded once-in the
banner year 1907; and there has been
steady gain over last year each month
since February. Our imports have,
as everyone knows, been stimulated by
business activity, high prices and gen
eral extravaganza; our purchases of
luxuries from Europe, particularly pre-
cious stones, being remarkably heavy.
The present tendency, however, to-
wards economy, lessened activity, and
lower prices will eventually have the
effect of discouraging imports and sti-
mulating exports; thus bringing our
foreign trade back to more normal
conditions. 1t is unfortunate that
our crops this year are not larger
but some Offset to this drawback will
be found in increasing shipments of
manufactured articles. Europe will
be obliged to buy our cotton freely at
good prices, AMI this will be an import.
ant factor in adjusting our trade bal
ances. Our exports of food products,
however, promise to be strictly mode
rate, as we have relatively little to
spare and our prices are still too high
to tempt foreign buying. During the
first six months Europe was a liberal
purchaser of our securities to which
cent gold imports in face of an adverse
merchandise balance. 1t is hardly to
be expected that foreign capital will
flow into the United States with the
same freedom in the latter half of 1910
as in the first half; and the situation
is now less favorable to gold imports.
The technical situation of the stock
market has been visibly strengthened.
The conviction spreads that the low
prices at the end of July will not be
seen again for some time to come. AL
though the recovery from the break
has been sharp, perhaps too sharp, a
good many stocks are still good pur-
chases from the investment point of
view. For the time being the invest
ment demand has been checked, but
confidence is steadily growing and our
prominent bunkers and financial lead.
ers are daily becoming more and more
confident regarding the future. This
is shown by improvement in the bond
market. There are still several un.
certainties such as the crops, the po-
litical outlook, the Standard Oil and
| Tobacco cases, the question of rail-
road rates, etc, which are to be set
tied, but the worst respecting these
it would seem has been fully discount
ed. Very soon two of the pivotal
crops, corn and cotton, will be out of
danger The prospects for these are
still improving Corn promises to
reach about a 3,OOO,OOO,OOO yield, and
current estimates are for 100000
bales of cotton, which is showing less
deterioration in August than usual
There is still 1.-The danger of early frost,
but each week reduces the area liza
BILE to such damage, Spring wheat
crop is already turning out better than
expected After the Labor Day holt
days business should begin TO resume
more normal activity, The vacations