The Topeka state journal. [volume] (Topeka, Kansas) 1892-1980, 1911-04-18
TAKING A REST CURE.

This is what business is doing in the
mind of Henry C1ews, the veteran New
York banker. whose expressions on the
conditions in the commercial and
financial worlds are rightly taken as
the sentiments of the conservative
business men and fnanciers in the big
marts of trade. As an analyst of
these conditions he has few Compel
itors. And while he points out that all
lines of business are a trif1e dull as
compared to the conditions which pre-
vail when prosperity's banner is being
vigorously waited in the breeze of
great activity, he sees no reason for
any alarm. He thinks there will be
continued readjustment to lower
prices, and that conditions will be
normal again before long. Writing to
this effect in his current weekly finan-
cial review, Mr.. C1ews says:
1.-THE main difficulty with business is
that it is passing through a period of
liquidation and readJustment similar
to that through which the securities
markets passed year or two ago.
Our commodity markets have been
upon too high a level. The public
buying power had become exhausted.
Feverish activity and imitation had
carried the rise in prices to a stand
still. Credit was unduly strained.
Liquidation was inevitable, and there
is no cure in sight except a return to
normal conditions through a general
decline in commodity values. This
curative process is now under way. 1t
has made considerable progress in
some directions, notably in food prod
ucts Breadstuffs have declined about
rs per cent, while pork products have
in many cases declined 40 per cent.
Steel products have shown consid-
cradle depreciation, while copper and
cotton have also shown a downward
tendency since the high records Of
last year. A new factor has arisen in
the situation; that is the consumer.
The campaign against general extrav-
|agance is having its effect. Economy
is now the order of the day, and the
average man is either spendinging less
on food and clothing or else making
his money go further by substituting
cheaper materials. This is unques-
tionably having a distinct though
silent effect upon many lines of bust
ness.
Another cause for reaction is the
cessation in new enterprises, brought
about by the OVERRIDING which culni-
mated in 1909 and 1910. Doubtless
this has been accumulated by uncer-
tainty attending the court decisions
and tariff legislation, as well as by
adverse railroad developments; but
had these factors not intruded it is
unquestionable that there would still
have been a very considerable degree
of hesitation owing to inevitable re-
dictionary tendencies. In the steel
trade the outlook is not as bright as
month ago. Railroads are econo-
MIXING, something they are well able
to do 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 prac-
teal fashion; economies are being in
troduced wherever possible, and the
railroads before carrying projected
improvements any further are cal
culating upon buying cheaper iron and
steel. The copper situation is another
illustration of an important industry
which is suffering from purely arti-
fetal conditions. Production has been
unduly stimulated by a persistent
maintenance of high prices, the result
being tremendous oversuppIy. Prob
ably no cure for the situation can be
found except by lowering prices and
thus stimulating consumption poll