The sun. [volume] (New York [N.Y.]) 1833-1916, 1914-04-27
War, Stocks and Business.

An effect out OF all proportion to its
rOnjectural dimensions seems to have
been produced In the stock market in
the last few days by the Mexican war
cloud which has cast its shadow 80
swiftly over the country. There can
be no doubt that the prospect Of Mex
lean war caused the further violent
decline in security quotations, both Mt
home and abroad. in the last week. but
q mistake would be made II the finan-
cial disturbance were regarded in rela-
ton to Mexican developments alone.
For its own part THE SuN is pre-
pared to believe and Is disposed to say
that the collapse Of values has over
discounted an uncomplicated conflict
with Mexico. great as may be the un-
dertaking which confronts the United
States in the unhappy republic across
the Rio Grande. We are persuaded
that our friends. instead Of taking
alarm for their affairs from the por-
tents Of the stock market. should con-
slider rather the extent to which Amer
lean financial and business positions
have been fitted by the adversities Of
the past year and Of recent months 20
meet the test Of warfare. and to re-
spond to those favorable influences
which are more likely than not to issue
from the progress Of the crop season
and the inevitable change In political
tempers to constructive mood.
change which was indeed impending
before the Mexican crisis arose.
Whatever loose reasoners may say.
war is not a good thing for trade and
finance. 1t means unsettlement Of the
productive organization Of commerce
and industry. 1t means dislodgment
and dislocation of funds. The costs
NJ war have always to be counted. and
after their fashion the financial mar
kets are very likely to count them in
advance OF war. even before conflict
becomes n deadly certainty. The pres
ent stock market happenings may
therefore be viewed as a cautionary
process OF readjustment. but so far As
the United States Is concerned there
is nothing In the prospect Of Mexican
war alone which makes the signs Of
the stock market alarming.
Were II not for conditions In Europe
It may he questioned very much If the
Mexican crisis would have produced 50
much stock market effect. 1t was Eu-
rope which forced the fresh collapse In
Wall Street, and the principal European
security markets fell in all depart
ments last week. making no special ex-
ception of American issues. The natural
inclination of European finance would
he to sell some Of Its American security
holdings on the mere fact that the
United States was confronted with "A
war. however assured American arms
might be Of carrying the contest to a
successful conclusion. In war time Eu-
ropean finance acts on the maxim that
the precise consequences of war are I'M
practicable and on the further maxim
that war is always costly.
Nevertheless, the weakness which the
Mexican crisis induced In Europe and
WHICH, WAS communicated mere from
abroad. seems to have been owing
chiefly to the foreign situation on which
the war news came. Without eaborat-
ing all the economic conditions, suffice
1t to say that European financial GEN.
tres have been strained for some time
by the exhaustions OF last years eco
nomlc upheaval.
Lately there has been good deal Of
uneasiness on account OF certain symp-
toms, political and financial which
might denote II fresh disturbance Of in
tcrnatlonnl relations in the Old World.
The Russian and French scramble for
gold with which to augment bank rc-
serves might be yariously interpreted,
but there has been some tendency 10
construe II In the light Of military
aggressiycncss attributed to Russian
purposes. At such u juucturc the re,
ported mortal Illness of the Austrian
Emperor could hardly fail To cXaggcr-
atc fears which would find their ex.
preston in the security markets.
Thanks 10 generation Of tradition.
Europe had panic on the outbreak Of
war In the Balkans in 1870. The En-,
ropean peoples had been trained for
decades To believe that such n conflict
must end in n general conhagration.
very much III" same kind Of tradition
Has obtained respecting FRANCIS 10
sIrH. How many American school
boys have been taught To think that
me peace Of Europe would not survive
MS death: With the drawing Of his
long life to its close circumstances
"er' pound to h" created which would
max" II hard for European finance To
endor" readily the shock OF approach