The Virginia enterprise. [volume] (Virginia, St. Louis County, Minn.) 1893-19??, 1914-08-07
AMERICAN TRADE
WILL SPARKLE
DURING WAR
Boston Financier Says Uncle
Sans Business Will Be Stimu-
lated by European Quarrel

Sam 3 BUSINESS VIII be Ot1mu"
lated by European Quarrel
BOSTON. Aug. 6.-Interviewed by
the Boston Post on the European
crisis, Clarence w. Barron, editor and
publisher of the Boston News Bureau,
said:
"American business will be slim
ulated as it has been by every Europ-
can war of late years. The South
African war stimulated business of
this country. But it must be remem-
bered also that war raises the cost of
capital, enhances interest rates, and
does not in the end facilitate business.
It is similar to trade boom, and then
a reaction.
LAST year we had considerable
business in this country from the Bal
kan war, but both the South African
war and the Balkan war raised prices
and increased the cost of living in this
country and absorbed capital which
could have been better employed in
wages to labor for DEVELOPMENT in
this country.
"A general war will of course par
alyze the shipping Of the world. But
fortunately, outside of the Interna-
tional Mercantile Marine, our ship
ping is coastwise, and would not be
molested. The International Mercan-
tile Marine is represented by its bonds
which are now selling at less than SO
cents on the dollar. The entire selling
value of this security is less than
$5O,000,000, and a devastating war
could not destroy more than half of
this.
mo financial troubles in this
country need be feared. The danger
has been avoided by the closing of the
security exchange. We cannot stand
up and suddenly receive back into this
country and pay gold for billions of
American securities that are owned
abroad.
"a Boston friend of mine visited
London to answer for himself the
question of what could be the effect
if England suddenly tried to sell, as
in the case of war, all her American
investments-New York Central, Penn.
sylvania railroad and other securities
Investigation showed clearly that the
fact was she could not sell them. The
prices would fall so rapidly as tt
| make the sacrifice too great.
1.-THE closing of all the security ex.
changes in the world will likewise
! assist the general settlement or thu
localization OF the war. The funds
cannot be secured to prosecute thu
1 war.
'The only bankers in the worle
who are prepared for war are thu
German bankers. For three years
under imperial direction, they have
been paying their debts and bringing
their reserves within their own coun
try. A year ago this month l was il
Hamburg and was told that the grea
house OF Warhurg, for probably tn,
! first time in a century, did not owe {
dollar outside Of Germany. Thi:
house is probably about 200 years old
Il asked at the Deutsche bank i,
Berlin if Germany was curtailing be
cause over-extended, or was prepar
ing for war. The response was: II
makes no difference. The order.
would be the same in either case, ant
nobody can tell but the KAISER
1.-THE Kaiser, through the German
chancellor, is the head of the Reichs
bank, in which is centralized all Ger
man finance. It has 500 branches ant
does business throughout the empire
It touches vitality all private bank
and unif1es the banking system O
Germany more effectively than else
where in the world.
after two years of retrenchmen
the German Reichstag a year ago las
June called for $25O, 900 900, or
billion marks, to be paid right off tn
capital account of every citizen in tn
empire from the Emperor down, t.
increase the army. The reserve il
the Spandau tower was also doubled
This is only cash reserve, of col
and silver, which would last fey
weeks, while the country was expect
ed to be in a financial panic, an
when money is not available unles
you have it in your pocketbook.
German bankers and the Germa
military program go hand in hane
About four years ago the Germa
emperor sent his gunboat Panther t
Agadir in violation of the treaty o
Algeciras. This was French terri
tory, but it was the British Lion tina
growled. Germany had to bac
down. German loans were called a
over the world.
"The German emperor then told tn
business men and banking interest
of Germany that when he Gale
again he wanted different response
and would expect them to be pr
pared. They are now prepared.
$50 likewise are Russia and France
both with gold reserves. Englan
will fight on the ocean, and need ne
strengthen her gold reserves. Sh
does not owe the outside world.
"The situation is simply this: Til
Germans for more than ten yeal
have been toasting Der Tag that
the day which is to arrive when Gel
many will assert her supremacy q
land and sea.
''The day has now arrived. She
ready as never before. But ever!
body else is pretty we'll ready for he
g ~ rhn