The Topeka state journal., 1914-02-24

BUSINESS CONDITIONS SOUND.
Moderate hopefulness II the prev
alent tone in business" writes Henry
Clews. the New York banker. in his
weekly review Of the conditions that
prevail in the world OF trade and
finance. This sentiment" he con-
tinues, would be probably more
pronounced were it not for the fact
that we are still passing through =
period of readjustment to new polit-
ical and Industrial conditions. In
other words. we are in the throes OF
methods, which are not always cheer
fully accepted and which frequently
produces more or less friction and
hesitation. So far az political changes
are concerned. these promise to be
much less radical than was feared q
few months ago. There has been con-
siderable modification of extreme
views held in Washington: and the
evident inclination of the administra-
tiOn to give business a fair chance is
having its effect upon the federal leg
islature. In Industrial circles the pre-
vailing sentiment Is also more hope
full; although there is considerable
dissatisfaction, particularly in the
east. over the changes necessary to
meet new legislative requirements
The disposition of congress to meddle
with business often runs to alarming
extremes. and thoroughly justifies the
frequent apprehension of serious con-
sequences unless there is a halt in dis
turbing agitation. Some time must
N al hn
tendencies have exhausted themselves
and the new requirements have been
made clear and effective. Not in this
generation has there at any time been
such universal complaint against ex-
cessive interference: and 1t is high
time that the business community
raised its voice in vigorous protest.
West Of the Alleghanies there is a
decidedly more optimistic tone be-
cause that section Of the country is
less susceptible to attacks upon cor
porations, or to industrial depression,
than the east. The west is also in
generally sound condition, and is still
feeling the benefits Of last years good
harvests.
'The monetary situation continues
satisfactory; and though funds are
less plethoric and the lowest point as
to rates seems to have been touched
there Is no reason to anticipate any
undue firmness for several months to
come. This condition is extremely
fortunate, inasmuch as enormous
amounts of short-term notes and
other financial deals have to be pro-
vided for during the first six months
of 1914. The greatest danger in the
situation has been the possibility of
congesting the worlds money mar
kets by too rapid an issue of new 1o-
tations. This condition in world
wide. The French minister Of finance
recently estimated that the floating
debts OF Europe stood at the unprece-
dented total Of $1,500,000,0 900. and
that there must be at least as much
more in municipal and Industrial
corporation issues. When 1t is con-
sidered that very considerable pro-
portion of this capital was sunk in
unproductive issues. it is easy to see
that fresh supplies Of capital are not
forthcoming as papidly as might 9TH
erwise have been expected. A similar
though less extreme position prevails
49, eAAO oAAASCA NSsoSSos eAAAA AO1 Suu0tCAy
we are in a much better position to
finance such obligations; although
here also the supply Of new capital Is
probably not accumulating as rapidly
as in previous years.
General conditions are sound, and
the earning powers Of our large rail>
road and Industrial corporations,
though put to a severe test by slow
business and increased expenses, have
not showed any impairment. Never
theless. there are several uncertain
ties which need to be watched. The
railroad rate situation is probably the
most important factor. It would be
a mistake to expect the administra-
ton to interfere, although it Is very
probable that the desire of President
Wilson not to hamper business fur
ther than necessary might have some
effect at least in Fastening a decision
and thus removing doubt. 1t is now
said that decision may be expected
not later than July. This is encour-
aging. but railroads. which are not
likely to get all they ask, are still in
the midst of crisis, and the severe
winter weather of the last few weeks
is sure to have a detrimental effect
upon their earnings, which on the av-
erage are running fully five per cent
below year ago. The transconti-
mental roads have been unfavorably
influenced by approaching competi-
ton of the Panama Canal, which
may enforce some reduction in rates,
also by the government suit to compel
the Southern Pacific to dispose Of its
Central Pacific holdings. Another
factor of uncertainty is the enforce
ment OF the Sherman antitrust law,
which may compel the dissolution of
many of the big Industrial holding