The daily Gate City. [volume] (Keokuk, Iowa) 1855-1916, 1914-12-09

essarily involved the risks of too sud-
den ease and too much imitation, IN
view of the large amounts Of emery
ency currency and clearing house GER
tificates still outstanding. Fortunate
ly both Of these forms Of currency
are being retired as fast as possible;
and as the reserve banks get into
more perfect working order their con-
troll over the money situation will In
crease and the danger of unwhole-
some imitation will vanish. The in
evitable increase OF money and credit
will however prove a powerful aid to
business revival. and II long con-
tinued, cannot but have q great slim
illus. not only upon trade but also up
on investment values. The tremend-
Gus extent to which credit facilities
have been expanded is not yet fully
realized, and until the money market
has adjusted itself to this heavy In
crease in bank reserves our bank Of
ficials will have to exercise much dis
erection and restraint II they intend 20
prevent an undesirable expansion OF
credit. Care will also be needed to
conserve the domestic gold supply,
which is large and widely scattered all
over the country Our best safeguards
are to persistently retire redundant
currency and to develop the export
trade as much as possible. Our ex-
ports have already recovered wonder
fully from the war, partly owing to
the big foreign demand for our food
stuffs, and partly to the urgent In
quiries for war materials from the
various belligerents. One government
official has already stated that the war
will add 100000 to the foreign
commerce Of the United States.
Violent fluctuations must be expected
to accompany the derang cement OF in
ternal trade. The world has largely
adjusted itself to. the war basis: but
as soon as peace comes, another sharp
readjustment will follow. The great
industrial nations, England and Ger
many, will return to work with intense
|eagerness to recover what has been
lost. Competition will be keen and
prices low. This new rivalry for for
eign markets promises to exceed any
thing the world has ever seen; and
what effect that condition will have
upon tho United States is yet to be
determined. Possibly there will be
an thrush OF imports. particularly I'M
der our new tariff. At the same time
our exports of merchandise might
temporarily decline.
Trade at home is dull Reduced
bank clearings, declining railroad
earnings, contraction in building, &C
companied by an unusual number OF
business failures, all furnish unwel-
come testimony in this direction. But
let it be thoroughly understood. these
statements represent conditions that
are passed. The tide has turned. The
country must look forward to the con-
structive effects Of sound banking
system. to a period OF easy money and
to the sustaining effects of good
harvest The stock market will be the
first to reflect these better condi-
lions. and were it not for the war
American securities would be selling
many points higher than they are to-
day. II 1t proves true that this mar
| ket has fairly discounted the war
and we think 1t has-then American
securities are entitled to substan-
tial recovery, provided the fortunes
/! or misfortunes of war do not prevent.
There Is one other factor on which
much hope is being based. and that is
that the interstate commerce commits
sion will yield to intelligent public
opinion and also to the desires Of the
administration by granting some por-
ton Of the railroads request for an
advance in rates. Should favorable
decision be forthcoming this month,
as is anticipated in some circles. the
event will have distinctly beneficial
effect upon business sentiment gen
orally The restoration OF business
confidence would be greatly accelerat-
ed by such tangible evidence OF the
cessation OF official hostility to big
business. President Wilson's coming
message to congress will be awaited
with much interest.
Investment purchases have been
largely held back for the last four
months. and savings must have ac-
cumulated considerably IN conse-
lquence. There is no serious foreign
liquidation now in sight: and, as
there are no safer or better paying
investments in the world Just now
i than Americans, 1t follows that there
should be sufficient domesti and for
eign buying to Offset any probable
liquidation on foreign account The
investment demand at home Is stead
lily growing with the increase OF con-
fidence, and the larger dealings In
bonds, short term notes and public
4 utilities are a visible expression of
this Improvement. At present prices
the better class of railroad shares and
certain industrials are paying invest