The daily Gate City. [volume] (Keokuk, Iowa) 1855-1916, 1911-04-20
THE REST CURE.

THE REST CURE.
There is temporary lull in the ma
tons commerce and vast number
OF freight cars are just now empt
and idle. But there is nothing omin-
Gus about the outlook. In his review
of the situation Henry Clews. the vet
eran New York financial observer,
says that the main difficulty with
business is that it is passing through
a period of liquidation and readjust-
4 ment similar to that through which
tie securities market passed year
or two ago. Our commodity markets
have been upon too high a level. The
public buying power had become eN-
hausted Feverish activity and infla-
+ ton had carried the rise in prices to
4 a standstill. Credit was unduiy strain
ed. Liquidation was inevitable, and
there is no cure in sight except a re-
turn to normal conditions through a
general decline in commodity values.
This curative process is now under
way. 1t has made considerable pro-
gress in some directions, notably in
food products. Breadstuffs have de-
clined about % per cent, while pork
products have in many cases declined
40 per cent. Steel products have
shown a considerable depreciation,
while copper and cotton have also
shown downward tendency since the
high records of last year. A new fac
tor has arisen in the situation, that
is the consumer. The campaign
against general extravaganza is hav-
ing its effect. Economy is now the
order of the day. and the average man
is either spending less on food and
clothing or else making his money so
further by substituting cheaper ma
terials. This is unquestionably having
a distinct though silent effect upon
many lines of business.
Another cause for reaction is the
cessation in new enterprises, brought
about by the OVERRIDING which cul-
minated in 1909 and 1910. Doubtless
this has been accentuated by uncer-
tainty attending the court decisions
and tariff legislation, as we'll as by
adverse railroad development; but
had these factors not intruded it is
unquestionable that there would still
have been very considerable de-
gree of hesitation owing to inevitable
reactionary tendencies. In the steel
trade the outlook is not as bright as
a month ago Railroads are economic
ing, something they are we'll able to
dc because of their present excellent
physical condition. The refusal of the
interstate commerce commission to
grant the railroads permission to raise
their rates is being met in practical
fashion; economies are being intro
duced wherever possible, and the rail-
roads before carrying projected inn
provements any further arc calculat-
ing upon buying cheaper iron and
steel. The copper situation is another
illustration of an important industry
which is suffering from purely artifi-
cial conditions. Production has been
unduly stimulated by persistent
maintenance of high prices, the re-
suit being tremendous over-supply.
Probably no cure for the situation
can be found except by lowering
prices and thus stimulating consump-
tion-a policy which producers at
present are unwisely opposing
In the west a very conservative
business spirit prevails; the wave of
depression which began on the sea
board is now working its way slowly
but surely towards the Pacific coast,
where in due time it will completely
disappear So far as the business out
look as whole Is concerned, there is
nothing to cause anxiety. 1t is doubt
full if readjustment is yet completed,
and we may look forward to period
of more or less quiet. Business is
really taking the rest cure. treat
ment never quite acceptable to the
active American spirit.