The Hawaiian star. [volume] (Honolulu [Oahu]) 1893-1912, 1911-08-03
HOW NEWS MAY
Be EXAGGERATED

Referring to the good effect that |
quickly followed better crop news,
Henry Clews, in his special letter of
July %, says the incident furnishes
another instance of the wisdom of
refusing to accept at anything like
their face value first reports of wide
spread crop injury. When we con-
sider," Mr.. Clews, proceeds, that
about 100000 acres are included
in our wheat producing area and that
our corn fields extend close to 49,
100000 acres, it will readily be APP
preciated how damage in quite extern
sive areas can be severe and spectac-
ular, how it can cause concern and
disappointment among the inhabi-
tants of these unfortunate sections,
and yet, in a broad sense, how this
damage should only be considered as
local and, from a broad, economic
viewpoint Nof final harvest conditions,
comparatively unimportant.
Spectacular damage, crop disaster
starvation even-these constitute
news" and it is very seldom that
our newspapers have occasion to in
form us of the Other side of the pic
ture, of exceptionally favorable con-
ditions which will apply to millions
upon millions of areas and which
naturally, play a most effective part
in the law of averages in connection
n,,,, hoo Gn11 Il
our corn fields are continental in
reach and scope; and it must indeed
be a nationwide damage that shall
cut down our final agricultural out
put to proportions spelling agricul.
tural adversely"
Mr. Clews comments on "the un.
paralleled total of $2,O4S, 691.392" of
exports for the year ended June 80,
being an increase of 1903, 7O6,672 over
those of the previous year and an
excess of $52O,706.3O4 over imports
for the past fiscal year. This sitUa-
ton, reinforced by a substantial ex-
pdftation of American securities,
means that gold will undoubtedly
come this way as soon as the de-
mand for it here is sufficient to JUS
tify the movement"
A point that Mr.. Clews thinks
should be kept in view, in connection
with the money situation and it's re-
lation to the market for stock eX-
change securities, is the large in
crease that has taken place during
the year in the security holdings of
national and state banking institu.
lions. THE comptroller of the cur
rency in his final report of the bank
call for June shows that national
banks had on hand on that date $685.
475,144 in securities, or S145,543, 425
more than at the corresponding date
a year ago. This indicates that as a
result of backwardness in trade and
manufacturing circles the banks have
been investing in high-grade securi-
ties the funds they could not use in
their regular loan and discount ac-
tivities. 1t may safely be assumed
that the national banks in this re-
SpGCl lCpl GOSlJ Win lclll clCCul CCg
similar conditions in our state bank
ing institutions, and it seems also
quite logical that bank directors
would be apt to follow in their indi-
have outlined for their banks. This
means that there has been an ex-
tremely large accumulation of secur-
tiles that will be held until the usual
demands for funds in mercantile and
manufacturing activities become in
sistent. When this condition fully de-
velops there is apt to begin liquida-
ton of securities by banking interests
in order to replenish the volume of
their loapable funds"
In the conclusion of his letter Mr..
Clews observes:
1--WE have clearly in sight another
season of agricultural prosperity, of
abundant money, of favorable pros
poets for mercantile and industrial
activity and feeling of growing con-
fidence among our people. We have
just passed through a period of cur
tailment and caution, of reaction
from extravaganza. This spirit of
caution shows signs of eliminating
and to that extent the prospects favor
a confident merchandise buying move
ment that, starting with the individ-
ual consumer, cannot fail to prompt
ly spread to all channels of manufac'
turing and distribution, and in turn
from trade to finance"
SS