The daily sentinel., 1910-09-26
GIVES ANALYSIS
Of BUSINESS
CONDITIONS

A splendid and clear cut analysis
of business and financial conditions
throughout the country was given to
Sentinel representative today by
Mr.. Edward J. Gallien. assistant to
Willis G.. Nash. president of the Mer-
camille National bank of New York
City, one of the strongest financial
institutions in the country.
During the interview at the St
Regis hotel today Mr.. Gallien paid a
splendid tribute to the farmers and
ranchers of the West.
Some time ago great hue and
cry was raised" said Mr.. Gallien,
regarding the wholesale purchase Of
automobiles throughout the country
and it was at first supposed that the
West was large responsible for the
withdrawing of money from the banks
as loans for the puspose. However,
an investigation was made and it was
found that as a rule the western
farmer or rancher who bought an
automobile was abundantly able to
afford 1t. He had his farm practically
crops, so that he was shrdluetaoi
paid for and was harvesting big
crops. so that he was Justified in the
indulgence in a car II he saw fit.
The trouble was right back East,
where the thousands of comparative
ly small salaried people were borrow
ing money with which to buy cars
and did not count the cost of main
/ tenanee. nor the time they would be
tempted to take away from business
As to tn eapparent decrease Of
deposits of western cash In eastern
banks there was, for time, a sus-
picion that the West might be some
| what timid after the financial upset
following the Knickerbocker bank
collapse. Here again an investigation
of conditions put us right as to the
causes of the apparent decrease.
I'VE found that the middle west
and elsewhere was re-discounting.
Farmers were holding back their
products for higher markets and SO
the banks which had carried them
for their crop just harvested. not only
was unable to collect on their loans
but were carrying the same farmers
for the coming crop. A stop was soon
put to this however, when the bank
ers demanded to know II the prices
prevailing were fair. II such de-
veloped to be the case. then the bank
ers told the farmers that they must
funload part of their crops so that the
rooney might be returned to the banks
4 tor further business assistance.
This situation was particularly
| true in Kentucky where the banks
were practically carrying the tobacco
growers for two crops while the
| growers held back for higher prices
than reasonable. But the quick ac-
ton of the banks in calling in, part
of their loans thus tied up tended
greatly to ease business conditions
and avert what might have been an
ugly situation.
Another thing which has contri-
buted and is contributing to a certain
shortage OF funds Is the heavy invest
ments being made by Americans in
Canadian land. There is land being
sold in this country now by Canadian
promoters for SOS an acre that five
years ago was drug on the market
at 50 an acre. From Iowa alone
there has been sent $50. 100000 for
the purchase of Canadian lands that
cannot compare with the lands of the
middle west and farther western Sec
tions.
This naturally creates an unrea-
sonable stringency. The bankers dc
not care how much money is with
drawn for investment in American
land, for that money comes back
through its usual channels. but the
money sent to Canada does not come
back
Mr.. Gallien predicts decided re-
vival of business and financial con-
dition this fall and winter which will
continue for an indefinite time bar
ring unexpected Interruptions.
Mr.. Gallien is here to attend the
state bankers convention. He is a
widely read, much. travelled gentle
man and an expert on financial mat
tiers. He is greatly pleased with the
Grand valley thus far.