The Birmingham age-herald., 1913-05-01
FIRST NATIONAL
MONTHLY REVIEW
Country Passing Through
Readjustment
FOREIGN SITUATION
SITUATION
FOREIGN
Austro- o-Montenegrin Embroglio Has
Disquieting Effect Weakening
in Pig Iron and Steel-Income
Tax Approved

in Pig Iron and Steel-Income
Tax Approved
The First National banks financial and
commercial monthly review of date May
l. 1918. is as follows:
"'rhe country is now passing through
a process of readjustment and the slack
ening in trade. which was noted 90 days
ago. may be expected to continue for
some time. pending the passage of the
tariff bill and new crop developments.
On account of the auieting down of busi-
ness especially in stock exchange trans
actions, money rates which six weeks ago
were high for the season of the year
have become easier and the demand for
first class commercial paper maturing in
the fall appears now to be fully equal to
the supply Corporate and municipal re-
of bonds are at higher rates than have
prevailed for many years past. Whether
we have entered a period OF permanently
higher money rates or whether the pres
ent level is only temporary, is a question
on which authorities differ and may be
best determined by events of the next L
months.
"The Bank of England discount rate
was reduced early in the month and the
chancellor of the exchequer, David Lloyd
George, in a recent address referred to
the high degree of prosperity now exist
ing in England and predicted a trade
boom in that country later in the year
The general European situation, however.
is not yet settled owing to the attitude
of Austria toward Montenegro, and the
bill now pending in the California legis-
ature, prohibiting Japanese ownership of
land, is regarded by some as disquet-
ing factor in this country but it seems
there is no real probability of complica-
tions between our government and ia
pan.
Pig Iron and Steel
'There has been a weakening in pie
iron during the month in all sections, and
prices recently realized ara reported in
some cases to approximate actual cost of
production. We understand that there
have been some sales locally of No.
foundry as low as s12. Stocks on the
yards are accommodating and unless buy
ing movement should materialize in the
near future, it is probable that prices will
go lower and that some of the furnaces
will be put out of blast, thus emphasiz-
ing the great need in the Birmingham dis
trict for finishing mills. steel mills are
running full time in filling accumulated
orders, and 1t is said that the new bus-
ness being booked is of gratifying proper
tions. The untitled tonnage of the United
States Steel corporation March 81 is re-
ported as being 7,46S, $50 tons, being only
about 100000 tons less than the untitled
tonnage December 81, 1912.
"Recessions in prices of cotton and cot
ton goods are also noted during the
month, and it is evident that merchants
will be slow to increase their stocks until
the new tariff bill becomes a law and it's
effect definitely determined.
The Underwood Bill
"There seems to be little doubt that
the Underwood tariff bill will be enacted
practically as reported to the House, al
though strong fight will doubtless be
made in the Senate on the sections plac-
ing sugar and wool on the free list. The
protests against the bill are not as strong
as might have been expected, and j.
seems to rect the requirements of the
popular Will 1t will have the effect of
opening our markets to competition from
abroad and will doubtless tend to reduce
the prices of many commodities. Should
there be general drop in prices of manu-
featured goods, wage adjustments will
become necessary, and whether or not
this can be accomplished without serious
trouble is problematical.
During the period of advancing
prices beginning about II years ago,
governmental expenses have increased
enormously and it is estimated by a
good authority that lme annual cost OF
being governed in the United States,
including taxes paid for federal. state,
county and municipal purposes amounts
to more than $50 per capita and there
does not seem to be any disposition to
reduce this cost. In fact the indica-
tions are that it will go much higher
before a general sentiment Will be
aroused in favor of economical public
expenditures.
"rhe proposed income tax appears
to meet general approval, although
some objection is made TO lne feature
| Of exempting entirely incomes not eX-
ceeding $4,000 per annum. This direct
tax will be levied on not exceeding 5
per cent of the population, per cent
being probably closer approximation.
lit is claimed by some that the ten-
dency of this exemption will be to
create class distinction and that a
system modelled after the English law
taxing all incomes less certain specific
| exemptions, would be more equitable
and would tend to arouse a greater
popular interest in more economical
administration of the government. There
seems no reason to believe, however,
that any important amendments will
be made in the bill now before the
House.
I Banking and Currency Reform
| "It has been announced that banking
and currency reform will be considered
at the present session of Congress and
( tseveral bills are expected to be intro
duced in the house as soon as the
tariff bill is out of the way. 1t is be-
llieved that an act will be passed, which
will contain most of the general prin-
ciples of the Aldrich bill. the essential
difference being that instead of one
central reserve association with 10
branches, there will be number of in
dependent regional banks or reserve
associations, each OF which will act as
reserve agent for banks in its own
district and rediscount commercial pa
per for them; all the regional banks
being under the supervision OF a COM
mission in Washington.
| sThe present national banking laws
seek to provide against undue extern