The Birmingham age-herald., 1913-05-31
GERMANY'S DEMAND
FOR MONEY CAUSE
Has Been Straining Credit to the
Breaking Point and Large Sums
Have Been Taken From
the United States
by HOLLAND

citizens of Wilmington, Del, and what
he said became the next day topic of
nation wide interest At that time indus
try and business of all kinds were forging
ahead magnificently, at least to super
fetal appearances. All the forecasts were
of continued and progressive business ac-
tivity. But Mr.. vanderlp spoke in words
of monition. He advised caution. There
were hints in his address that it was the
prudent part for business men and for
bankers to begin to take in sail These
monitions were of value. for the very dan
gers which Mr.. Vanderlip outlined as pos
sible became very real dangers a few
months later. Many business men, how
ever, had prepared themselves for these
demoralizing conditions in obedience to
the monitions of Mr.. vanderlip
This address has become traditional. 1t
is still spoken of as the first public words
of warning of the reaction which actually
did begin and become nation wide some
months later.
The other day a high authority, Joseph
I. Talbert, who holds the same relation
TO the National City bank which Mr.. VAN
derlip did when he appeared before the
business men of Wilmington-vice presi-
dent-delivered an address to the Bankets'
club of Detroit. After the published re-
port of it had been carefully read in this
city, bankers and business men said to
one another, This Detroit address of the
vice president of the National City bank
reads in some respects like the earlier ad-
dress delivered by a vice president of
the same bank who is now president of
the institution"
The address has occasioned much COM
ment. 1t is full of suggestions of deep i'm
port. Many of the statements made by
Mr.. Talbert, which occupied no more than
brief paragraph. could have been elab-
grated into full lecture with advantage
to the American business community. The
first part of the address almost echoed
the thoughts which Mr.. Vanderlip ex-
pressed at Wilmingham 1t is more than
an intimation. for it is in fact a plain
warning by Mr.. Talbert that the time is
now at hand when business men, what
ever their particular vocation, should
take heed lest the present high pressure
lead to reaction or, as Mr.. Talbert put it.
lest business and finance in this country
break the speed limit with the credit ma
chine of the country's resources. In
stead of running into that danger the
brakes should be clamped down before the
curve OI tne ROAD is Tedcned.
Not Alarm But Caution
This statement is spoken of here as re-
hect1ng the opinion of some of the ADLER
bankers that while business conditions
throughout the United States are at the
moment highly gratifying, nevertheless
there is danger that there may be over
strain and that an attempt may be made
to carry on business along broader and
greater 1OaS han ha
resources of the country justify.
In other words, we have just at this time
reasonable activity and fairly good de-
gree or business prosperity. But world
encompassing conditions and the tremen-
dous pressure which is being exerted upon
business across the seas, especially in
Germany and in Great Britain, may lead
to situation, possibly as near as next
fall, when reaction due to overstrainng
of credit and to the lack of sufficient new
capital to bear the burdens of great bust
ness may be felt throughout the coun-
try.
The moniton appears not to have been
due to any particular apprehension about
the effect of the Underwood taril. law.
Whatever the effect may be 1t will not
be comparable apparently, in the opinion
of bankers, with the embarrassments due
to the overstraining of credit the world
over.
The Worlds Present Condition
Wise business may prepare for this pos
sible reaction if it begins now. This is
SO because the world conditions are we
understood. Conditions today differ in
many respects from the conditions which
led Mr. Yanderlp 10 years ago to speak
In words of monition to the citizens of
Wilmington. In the early years of the !
present century, one great war had just |
h-o lol a,11 pfito In, xxtifI,
all the resources of financing statesman |
ship, was attempting to adjust the colos- |
sal war debt which the conquest of the |
Boer nation had entaied. At that time |
too, there. We're the portents of what be- |
came the wonderful struggle between |
Japan and Russia. In addition. In this !
country amazing overpromotion of indus |
trial combinations and mergers mad been
in. progress for three or four years. Ex-
tensiye liquidation was necessary; in fact |
inevitable, Speculation in almost every |
kind of venture in which speculation was
possible had been in progress. These fac
tors combined to bring to head the dan
gers to which Mr. Vanderlip had warn |
ingly alluded some three months earlier.
While Mr.. Talbert clearly intimates that
the danger which he believes turks today |
in business. financial and commercial life |
is practically the same as was the one to |
which Mr.. Vanderlip referred, neverthe- |
less the causes of this danger are very |
different now from those alluded to by |
Mr.. Vanderbilt There is strength In the !
fact that TODAY there is little or no spec !,
,,Ia+ion The stagnation of the New York |
stock exchange is phenomenon unprece- |
dented so far as its duration is con-
oerned. in the history of that organlza-
ton In the business world speculation
Of tho dangerous kind has been eliminated
IaxgaIy IF anv exists It Is confined to
onarations in real estate, which has re- !
oer,ti,, e,,oeested the possible overbuilding
81 some of the larger cities. Business
n,ar have for the most part paid their
debts
mt on the other hand there appears to
,o esnecially in Germany and Great Brit |
~, very high speed of the entire busi-
sa.,, annaratus This has entailed un-
80, demand for credit and for loans. A
ff,,narfcial view of this state of things
~ Cermanv and England might lead to
~ ipference that these are purely local
oesairs with which the United States is
not especially concerned.
We Are Concerned
Mr. Talbert however, pointed out that
va are or should be greatly concerned
shout these conditions. To whom did
cermanv turn last fall and year ago
for funds with which to relieve her of her |
e,pbarra assments? She looked to the United
states NOT entirely, but in great part,
and commanded large amounts of funds, |
with much gold, being willing to pay al
most excessive interest or bonuses for