The sun. [volume] (New York [N.Y.]) 1833-1916, 1914-05-18

idly an issue OF s20,0 900 OF notes on
per cent basis to tho public and a
Baltimore and Ohio issue OF s35, 000. 900
one year notes was taken Instantly on q
basis OF AZ per cent for a year The
course OF the stock market was additional
proof OF the strong position in which Sc
curities have been placed by the repeated
hammering liquidations OF recent years
and there was a propitlous omen for gem
eral business In the responsiveness OF tn.
share list 10 the hopeful auguries OF agrl-
culture. the favorable expectations of tho
Eastern railroad rate case and other con-
sidera'ions OF optimistic bearing.
The testimony OF quoted values was all
tho more striking because recent eventS
have not been uniformly helpful and there
was significance In the preferential re-
Election OF constructive factors. The eI-
cellence OF agricultural conditions has
been fully maintained and there is more
rather than less warrant for believing
that the Interstate Commerce Commission
Will decide at least partly FOR the con-
tonton5 advanced by tho Eastern rail-.
ways As the time for decision draws
near II seems clearer that the commission
must find that revenues arc not adequate
and that the only effective means OF re-
lief can be afforded through authorizing
general increases In freight rates.
A careful examination OF all the facts
In the financial and business situation
shows that reasons are not stronger, but
only more obvious why business and
finance should proceed in expectation not
or expansion, but of recovery. II Is not
the possibilities OF expansion with which
bankers. merchants and manufacturers
have now to reckon. Expansion In some
thing too far off TO he considered. Re-
eovery IL the next thing in order and
there IL a good deal OF room for that.
measured from the levels OF depression
which have obtained.
Nevertheless Il would seem that re-
coVery must proceed with respectful
regard for numerous unpleasant oontin-
gencies. Since week ago various remind
er5 have been furnished that caution
must qualify optimism and desire for
q restored prosperity must be tempered
with patience. Tho Mexican crisis teens
with disturbing potentlallties and while II
n the sober judgment OF finance that the
worst issue OF the Mexican imbrosllo
must be beneficial in the long run, the
uncertainties OF Mexican affairs are at the
moment adverse TO steady stock market
and business recovery.
OF more consequence IL the clouded
aspect OF economic conditions abroad. We
cannot hope to escape wholly from re-
strictive Influences which emanate from
the European situation. All accounts agree
that last week London narrowly avoided
a panic in the stock market, disaster being
averted only by important assistance in
voked and rendered for the salvation OF =
severely crippled position OF considerable
magnitude IN Canadian and other socuri-
ties. In the extension OF relief II seems
that the Bank OF England was represented,
which IL suggestive OF tho scope OF the
danger that threatened.
This episode was startlinEly inumina-
tive OF the difficulties OF the foreign finan-
clal situation. and according to trust
l.,S. ~ tat> 10 htYs
In London is better than at Paris. Doubt
less the wonderful resourcefuness OF tho
European banking power will Do equal to
the task of preventing any very unsettling
financial trouble, but there Is nothing very
cheerful on the European continent to-
day as may be Judged from the fact that
como astute observers In France talk a.
though the bottom of economic depression
had not been r.ached abroad. The way
In which gold was taken last week for eX-
port from New York was q token OF our
dependence on the course OF European
events. and many causes arc operating
to weaken our money market situation as
a result OF European arrangement, AL
| though there Is no occasion for appre-
| hension In the monetary outlook IL tho
| arrangement abroad does not assume q
| violent form.
Pressure on our supplies OF gold 10
! being eXerted as result OF Europe's
r,,r,,,e. nd through the worl,ine. or OH
rsvsad tariff, which IL undeniably con-
| tributing TO Increased imports OF goods
ISmr,hermore the AFOREMENTIONED money
,,,ar,,a, mnn,..tionahlv has been affecteI
hu snt,cinat,ona thai our new Federal
,..sry. hanlsing system will for a vhIls
csm.a cold aoInewbat automatically 10
| Saavs ,Se limited states. The position of
The soreIgn exchanees makes an interest
tno comniIcat,on with our preparations
To- an early tranaition from the old TO
~. nau ha nLiny system n complication
hat might become awkward according 10
m. drift of European affairs.