The Richmond Virginian. (Richmond, Va.) 1910-1920, 1910-07-07

/ NEW YORK July THE one
thing that seemed 10 stand out more
prominently than anything else In n
nancial estimation lag: week Was a
frank and unqualified recognition OF
the fact that business contraction 10 In
more or less widespread progress, and
next 10 this was an equally general
re alizatiou that such contraction was
about the best thing that could pos
Riply happen.
II 10 evident now that the beginning
of this slowing down was not of recent
date and that IL really started In the
fall months Of last year, II has been
peculiar IN this way, that 1t has been
irregularly conducted, experiencing
many fits and starts. and differently
affecting each particular business. Ger
tain lines IN the trade of the coun-
try even now are more active than
they have ever been before. Others
are obviously and greatly depressed.
But. taking business as whole. q
plain process OF defiation has been at
work for full eight months back
The letting off OF steam has bean
carried on quietly and SO gradually
that II has made little noise and has
led many people to doubt that any
nevertheless, comparisons of railway
gross earnings. of bank exchanges. of
pig-iron production and of general
trade returns show that business 10 OF
decidedly smaller volume now than II
was in October, 1909. and that the
course OF the shrinkage has been COM
paratively slow,
Nearly everybody 10 spending less
money than he did last year, and ap-
probation OF this rest upon general
observation, rather than upon the sta
tistics of the great curtailmen in GER
tain trades, such as In the cotton
manufacturing and wooden industries
or course. conditions In the case OF
cotton are altogether exceptional. In
no other department of trade has the
subsistence. been so manifest as In tex
tiles, but II has been general, never
theles3, and, at the expense of repe-
tition, It must be again emphasized
that all this introduction of personal
and corporate economy 10 a good thing
and that its continuation marks the
shortest route to a resumption OF bus
mess prosperity on greater and more
substantial scale than ever.
People are Accommodating Wealth.
Such conditions as these mean. re-
duced to their last essence, that the
people OF the country, instead OF spend
ing money. are saving It; that wealth
In the country, instead of being dissi
pated Is being accumulated, and that
the reserve stores OF capital. whether
In the form of cash or manufactured
goods or commodities of any kind, are
being replenished instead OF being
neediessiy and extravagsntly drawn
upon. What will follow after a reason
able period OF such a status will be
xxst<a Al ArlN
these great. enterprising and energetic
United States.
First, the huge stores of idle money
in the banks will begin to be rein
vested In the better class OF bonds
and similar securities. People who
have been keeping money there will
be tired OF getting but per cent.
interest, or. perhaps. no interest, and
will begin to acquire high grade In
vestments- The buying movement will
spread gradually to stocks, and, in
due time, will affect commercial and
mercantile affairs. Necessarily, the
normal progress of a recovery like this
needs facilities for its complete and
speedy contamination. One OF these
is that there should be no momentous
crop failure In any important agricul-
tural product. It is, therefore, graft
flying TO know. to begin with, that the
crop prospect this year. so far as II
has been revealed. Is for large har-
vests. and, secondly. that there are
now practically no uncertainties. ex-
capt those naturally proceeding from
the state OF business. pure and sim
pie. overhanging the situation.
How long time II may be neces-
sary for business contraction to con-
tinue before conditions are ripe for
another forward impulse ID something
that no one can attempt to tell. A
popular way of measuring 1t and one
that is not at all illogical 10 the extent
of the decline In the stock market.
At present the average price OF stocks
is away below that shown at the same
date last year, and II must be said
that many of these stocks are now
quoted at figures which seem to dis
count a good deal of dividend reduc-
ton. even II dividend reduction. In