The Birmingham age-herald., 1914-08-16

it may be that the high price of meat ana other foodstuffs which will prooapis pts vail in Europe for some time to come W,'i
 enable her to finish the year in very sat isfactory condition--that Is. that Wna, iS poison to Europe will be her meat nnt lnis is largely dependent, as previously staeeo, upon her ability to reach the market thdt it would be rash business man inoesu
 who would extend heavy credits on 1he strength of this possibility. without que quate security. which is something the Argentine has not to offer at the present
 moment.
 Practically all of Argentina's products are carried to market in English and Ger man bottoms. and should this service pc come paralyzed. as the chances are. her grain will rot in her granaries, ana her cattle pasture idly while Europe starves' and she will face the next financial year | in absolute penury. I 1 Further, it must be taken into consid- eration that there is actually in the Ar genuine surplus of practically everything | she consumes. aside from perishable ar ticles. Almost up to the very moment or harvesting the fa1s-l4 crop the prospects for bumper yield were almost unprece- dented, and importers in all lines largely overstocked themselves in anticipation or 1 a record demand, hope which was not 1 bv any means realized the result being 1 that the warehouses of the country are | filled to overf1owing with every class or merchandise little of which has been ac- tually paid for. and this surplus must be consumed before she becomes a large pur- | chasev abroad I know of an American 1 house which deals in agricultural machin- cry. which imported over s5oo,00o gold of l threshing machinery, and sold less than | 20 per cent of that amount, an experience l by no means unique
 To put 1t clearly trade in the Argentine was practically at a standstill before the European outbreak, and it remains to be seen whether the increased cost of food stuffs on the continent and in England as a result of the conflict, will be of any real advantage to her. Of course, Ger many, France and England will have to eat, and the Argentine is the only coun- I try in the world today which has large surplus food supply, excepting Australia and Canada, but it must be remembered that mankind can exist upon very little when the necessity arises and also that the great countries of Europe, in their warlike preparations, have not entirely disregarded the example of Joseph in pro- viding for the seven lean years. Should the war end within a few
 months, as has been largely prophesied by those in position to judge, it is
 doubtful if Europe will feel the bangs of hunger to any great extent. and a decla- ration of peace will immediately be fol- lowed by a landslide in food prices so , that unless the struggle should be of
 much greater duration than is generally predicted, and one of the contending par
 ties secure control of the sea to such an } extent that the Argentine products can be
 successfully marketed, it is quite within } the range of probability that the expected : increase in prices will be of very little
 material benefit to the republics of the River Plata.
 turn to the United States for many things. , and that there will be a heavy increase
 in our exportations to that country dur } ing the next few months-always provided that the little matter of transportation . and banking facilities can be arranged is beyond question, but those business
 men who are looking for a South Ameri-
 can outlet will find that it behooves them
 to walk very warily if they expect to reap
 any material benefit from the present ab- normal situation. Credits should be scrutinized with more than unusual care, for South American paper is difficult to l discount in the United States, and the l European banking houses represented | there will hardly be in position to as- sume further burdens-and this scrutiny | should be most microscopic in tln case of old established houses which have | hitherto been regarded as miniature l Banks of England. Should Argentine | commerce be paralyzed for lack of trans | portation for any considerable period, and the Argentine importers for this reason be unable to meet the heavy obligations with which they are now burdened, the country will face financial panic which will make the present "crisis del pro- l greso" look like flush times in California,
 and the crash will carry down not only | the most important native houses, but very probably many foreign banks as well. condition which brings about the closing of all the exchanges in a
 country so financially sound as the United
 States cannot favorably affect a country
 already struggling on the verge of the precipice of financial ruin and the truth
 of this is reflected in the Presidential de- cree, emitted the day following the de-
 claration of war between France and Ger
 many declaring general moratorium for
 a period of seven days. What steps have
 since been taken, I do not know.
 Assuming, however, that the next crop
 is good one; that the problem of trans portation is solved; that the banks will be willing to carry heavy Argentine cred it's it is beyond doubt that we will have a magnificent opportunity, temporarily at
 least, to develop our trade relations in l that part of the world, but whether we
 can maintain the channels thus opened will depend largely upon ourselves The l Argentine customer may by force of ne | cessity turn to us for the moment but it is extremely difficult to break off old trade relations and to discontinue old
 customs so that as soon as conditions in | hurOpe are anything like normal there will be decided tendency to return to
 old friends The problem which North
 America has to confront at the moment
 is not to obtain temporarily the bulk of
 Argentine commerce, but to fight for the , domination of the market in lines in
 which it has been proven that she can
 compete with Europe in normal times,
 and to retain that domination when nor
 nal times return.
 Certain statesmen or public men who
 depend for their prominence largely upon
 their supposed familiarity with South
 American affairs are now loudly trumpet
 ing the opportunities which the European n
 war offers to the American manufacturer to put the. trade of the neighboring re- publics in his hind pocket, and then sit on the pocket but it would be well to re-
 member that there are no American
 banks in South America; that we do not yet know whether we will be able to sell
 our cotton crop this year or not, and that above all it Is mighty bad policy to
 sell customer more goods than he can comfortably pay for.
 The moment peace is declared the mer- chant fleets now tied up in the harbors of the world will immediately restirne NJ operation, and these fleets do not fy the American flag. While 1t may take Eng
 land. France and Germany years to re- cuperate from their losses whatever the
 issue may be. 1t will be but a short time after the end of the struggle when their factories will once be in full blast for