The Topeka state journal. [volume] (Topeka, Kansas) 1892-1980, 1914-12-09
BUSINESS TIDE HAS TURNED.

BUSINESS TIDE HAS TURNED.
mo unfavorable developments fol-
lowed the much-dreaded partial open
ing Of the Stock Exchange writes
Henry Clews. the New York banker.
in his current weekly financial, review.
and he continues: THE bond market
commenced surprisingly steady and
many quotations showed considerable
strength. which happy result was fore
Swallowed in my previous weekly let
ters. Foreign liquidation was not an
important factor, although some SELL
ing was occasionally noted. In fact SO
positively encouraging was the exper-
iment of partial opening that the Elk
change for the first time since the
war, issued official quotations on
stocks selling at or above the minimum
prices. This very practical display OF
confidence, which should be encour-
aged, will doubtless have q widely
beneficial result. 1t will tend to es-
tablish opinion as to values. 1t has
already demonstrated there is no such
wholesale liquidation in prospect az at
one time feared; and it paves the way
for an early resumption of trading In
stocks on the Exchange. The action
of the bond market may be taken as
a fair indication of how the stock
market would act when reopened; ard
there is no longer any serious occa-
sion for delay in gradually removing
the present restrictions. There are
limitations that the London Stock Ex-
change may be opened by the middle
of the month, provided permission OF
the British government can be OBJ
tanned.
1T IL now over four months since
the New York Stock Exchange closed,
and no business organization In the
United States has made greater sacrl-
fees or greater efforts for the preser-
walton Of our national finances than
the members of that body, either indi-
vidually or collectively. OF course
they have been largely guided by in
telligent self interest as well. as by an
appreciation of the consequences
which might have followed the deDacte
arising from the war had it not closed.
Nevertheless, everyone in tho financial
district we'll knows that the, Stock
Exchange was quite as much In
fluenced in it's action by consideration
mediate affairs. When the emergency
came. far-sightedness. sound judy
ment and public spirit promptly push
ed self-interest to the rear; ana the
New York Stock Exchange through
prompt and unselfish action prevent
ed the gravest financial crisis this
country has ever seen from running
into incalculable disaster. Now that
this danger has completely dfsap-
peared and become only a matter OF
history, this fact Is no secret; and IL
not as a boast, but merely
as a matter of justice to an institution
that has had to bear much more than
its share Of abuse, and whose short
and mistakes are infiliitesimal
compared with the services which 1t
has rendered to the business commun-
ity. Many of those who loudly rallied
against our various Exchanges are
now only too glad to see them resum-
ing normal activities. ~.
1.-THE local money situation shows
further improvements. Funds are ac-
and rates are declining.
These tendencies must be attributed
first, to the beneficent operations OF the
new reserve banks, which have greatly
expanded credit facilities. and second
to the dullness Of trade, which lessons
the ordinary demands for accommoda-
ton. The lowering of reserve require
ments under the new system necessar-
fly involved the risks OF too sudden
ease and too much initiation, in view OF
the large amounts Of emergency cur
rency and clearing house certificates
still outstanding. Fortunately both
these forms of currency are being re-
tired as fast as possible; and as the
reserve banks get into more perfect
working order their control over the
money situation will increase and the
danger Of unwholesome initiation Will
vanish. The inevitable increase OF
money and credit will. however. prove
a powerful aid to business revival. and
il long continued cannot but have
great stimulus. not only upon trade but
also upon investment values. The ire
mendous extent to which credit facfl-
tiles have been expanded il not yet
fully realized and until the money mar
ket has adjusted itself to this heavy
increase IN bank reserves our bank Of
ficials will have to exercise much dis
prevent an undesirable expansion of
credit Care will also be needed to con-
serve the domestic gold supply. which
is large and widely scattered all over
the country. Our best safeguards are
to persistently retire redundant cur
rency and to develop the export trade
as much as possible. Our exports have
already recovered wonderfully from the
war. partly owing to the big foreign
demand for our foodstuffs, and partly
to the urgent inquiries for war mate
rails from the various bel1igerents. One
government official has always stated
that the war will add $500, OOO, 900 to the