The sun. [volume] (New York [N.Y.]) 1833-1916, 1914-08-21
FINANCIAL NEWS,
AND COMMENT
Wall Street Adopts Watchful
Waiting Policy Toward Emer- q.
gency Trade Plans.
FLAWS IN SHIPPING MOVE
Mr.. McAdOo's Proposal Of De-
posts Said to Settle But
Half the Problem.
FLAWS IN SHIPPING MOVE

Wall Street sentiment, generally speak
ing. was somewhat encouraged by the
evidence OF activity In the announcement
OF the various expedents devised by the
Administration for the solving of the
problems connected with the foreign ex-
change market and the foreign trade stu
alton. 1t Is realized that the present is
a time for emergency measures and UNI
due criticism is not helpful. Nevertheless
while disposed to assume a hopeful frame
OF mind. there was a good deal OF scepu-
cism as to how the plans proposed are
likely to work out
The pressing problem Of the day Is.
Of course. the loosening OF the blockade
on the export movement This has been
supposed to hang on the question OF pro.
Wong adequate shipping facilities. IL
shipping be provided, 1t has been argued,
the foreign exchange deadlock will solve
itself. Unfortunately. however, there is
an abundance OF such facilities. There
are at present lying in every prominent
American port vast number OF idle
ships of foreign nations waiting for car
goes. In spite OF this the Government
has been bending Its efforts upon the or
ganiza;ion of an American mercantile
marine, assuming apparently. that The
creation of ships run and owned by an
American company Is an immediate and
imperative necessity. Apart from the
many difficulties to be confronted in the
formation OF such an organization the
step taken hardly seems TO be direct
one
Moreover. II has not yet been proved
That American ships will be superior for
the purpose to foreign owned ships al
lady available. In fact. there are many
mercantile marine can become practicable.
People In the occangoing shipping trade
uoint out that unless the present naviga =
/ on laws are radically amended II will
/ be impossible for American run ships to
/ compete successfully with foreign owned
| ships. Until they are able to do 80 there
/ ~ no likelihood Of rush hy the public
20 invest in the shares OF the proposed
new shining combine even as n partner
/ - tNe United States Government
The design Of Secretary OF tho Treasury
I NcAdoo IN proposing to place deposits
, Of Governme mt money IN the banks 20 aid
the foreign exchange situation Is also
somewhat obscure But this movement
seems more to tho point In that Il IS
evidently intended TO stimulate the actuai
I undertakinc ~ shipments by exporters
, Apparently this move is simply In the
nature Of especial assistance 10 the bank
( I'm order that they may extend credit,
freely 10 ghipNeTs. So far as this end
~ tho transaction Is concerned the posi-
ton Of tho sh!ppsr 10 made correspond
nFlv easier. Unfortunately the othel
end OF the transaction. that regartYnf
ultimate npvrent for the shipment or
the oth"- side hns not vet been errectivci'
dealt with except In the case OF transac
lions covered hv special arrangement
with the British Government
In spite OF the fact that grain bill
n sp1 at,rr1,.s 4a~Ja
demand for exchange was 90 urgent a
10 cause n renewed advance IN rates. m
market closing A. 5.o3 70 5o7 for de
mand.
The roport TIM. the Government pro
-osas to roat a $4,000 900 per cent
loan IN order 10 meet the growing de
Nr'encv in Government receipts arouse
! very little interest Outside Of the spe
c'al Inducements attaching 70 Government
: bonds through their availability TO secur
nub''c deposits and possibly as securit
, for emergency currency such an offerin
has no attraction In times like the pres
ont Even these snerial inducements a
, not carry much weight.
The Bank % Fnglard's statement ex
: hIh'ted, "a II was expected Il would m
effects Of tNe remarkable extension Z
credits The huge discountlng bushes
! conducted ~ the banl, under the Gov
: eminent guarantee resulted In an increas
N loans OF s119.Gnn ono. bringing the tots
!. ~ % iva unprecedented figure Of f9i
Z 200 600 rs compared with f27 500 600
L vea- AGO. THE bank succeeded in addin
!, largo stock Of gold 10 its reserves. tai
!. ny In no less than s24,000.o 600. But eve
=, MIS- a'S,tion 40 not prevent the ratio
: -osa-ver to deposits dropping from 17.C
b, 20 1850 Tho policy pursued by the ban
', ~ dealing with tho present crisis M
:. hAan IN accordance with the best pril
% ,ir,cs OF harding. namely the extonso
" % accommod alton freely. hut al h'a
o9 -ata D'scount're was resumed vestel
~ Aav. but was again on snch a scale th
%. the authorities were once more forced
~ arzoend ~ catch up with the accumulate
work The Bank of France reduced /
ratio per cent. to 3 per cent.
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