The sun. [volume] (New York [N.Y.]) 1833-1916, 1914-08-04
FINANCIAL NEWS
AND COMMENT
Bankers Feel Situation Is Well
in Hand as Result Of
Emergency Stops.
CLEARING HOUSES ACT
Issue Loan Oertificates-Ex-
change Problem Still
Remains.
CLEARING HOUSES ACT

by European war was quickly relieved
yesterday. Thanks to the prompt and
energetic action taken by the banking
interests OF the country and the Govern
ment In cooperation there was n feeling
in the banking community last night that
the situation was well In hand. The
measures resorted 70 since last Friday
morning to cope with an emergency OF
unprecedented magnitude and Significance
were continued over Sunday and yester-
day. and the effect which they produced
was manifest in tho freedom OF tho day
from exciting manifestations of any de-
scription.
There was general recognition OF the
fact that for n situation so unprecedented
there were no rules 20 guide and that
tho steps taken to meet its exigcncies
had to bo dictated by the most intelligent
estimate possible OF tho Developments
as they unfolded themselves. The prevail
ing opinion OF the financial community
last night was that tho various precau-
tionary processes, from the closing of
the Stock Exchange on Friday to the
issuance Of Clearing House certificates in
this and other cities yesterday. would per-
init tho country to maintain its trade
and industrial equilibrium. and that there
remains now chiefly TO be dealt with the
tho foreign exchange market.
There u . substantial amount of money
owing by US abroad on open account, tho
bills &C rulng In the next thirty 20 ninety
days. There is entire agreement that
further remittance of gold. even II pos
would help Europe little and hurt US moro.
These debts were created by credit opera
tons. not by Europe's shipments OF gold
here, and the best way TO settle them would
be by credit TRANSACTIONS, but these are
practically precluded by the breakdown
OF international finance. The probabilities
are that the solution OF the problem will
be contrived Just as soon as the way Is
open for exports of our commodities.
II would hardly take the shipment OF
$50. 900. 900 bushels of our wheat o. Great
Britain TO clear all outstanding current
accounts against us and there Ia no ques-
ton that in the near future our expor,
trade will not only clean the international
slate but begin to establish credit bal
ances IN our favor TO be ultimately dis
charged by Europe when X energies from
the wreck OF war. II may he that Grea,
Britain win be able TO keep the ocean
lanes open for her merchant vessels. 1.
may be that the amendment of the ship
ping laws under way in Congress will pro-
vide q sufficient merchant fleet bearing
the United States flag To get our good.
and commodities out of the country and
into the markets where tremendous
demand exists for them.
Nor Is a solution OF the problem by
the establishment of bank credits here for
foreigners to draw upon precluded. The
question at all events was the only one
which seemed TO be left last night out OF
all the emergency questions that have
arisen for bankers to contrive an early
answer TO. and foreign exchange experts
were wrestling all day with the subject
in association with Governmental repre-
sentatives.
This association. BY tho way. was an
other token OF one OF the most encour-
aging features OF the situation; that Is,
the thorough understanding which has
come TO obtain between the Government
at Washington and the representatives OF
finance and trade. Bankers were, for
instance. much impressed by the evidence
afforded in Sunday nights conference OF
Secretary McAdoos thorough comprehen.
sion of existing conditions and their re-
qu!rements.
1t must be remembered that the dread.
| full certainty of war only denied hope
on Saturday evening. Accordingly the
| records OF the new week were bound q
be interesting from the start. The Eu-
| ropean response was in way similar &c
| the reflection here, an adoption of fnan-
cial precautionary measures although the
| foreign precautions were of a different
| sort. Here the intention Is to keep things
- A., ..,,...a.,s. =, .,,..o-.o.,, =. a
SINS az e..,". - a. =. -.
a'u N''an'a' 800
oeru''.e" '" ia.e '" 20 onpoyu 80
moratoriuins' 'hat TO- SUSPENSIONS Oh aepts
such as have peen oeciareu IN Francs
ana Great britain' aro the oruer q! th'
DAY moreover the regular oafk hoiuAS
In Great Britain has been continued 70
Friday. a step designed to afford oppor-
tunity for the bankers and tho Govern
ment TO arrange definite plans for cop
Ing with the difficulties OF war.
Before tho hour for the opening OF
the banks for business here the Clearing
House Association voted to issue Clearing
House loan certificates. These permit the
hawke IN SETTLE thcir daily balance, with
.ach o,her ut,hou, tina Use NJ rold and
go, 20 tner, "a not 10 ho criticised
a.,,to.u,, h,,, co,nr,srd.d n. nrac-
-, no,,,s;n, 80 ra,dy ,oc.I,,,as asain.,
80 go n,',,s, oan,,nas,c,.. -, ,ho y,,'
.i'o u,,n"o"n - 80, vi. C,.aa
ture. ihe "oNo % 10 o.U.s.,.',.,.
ing ROUSE WIS i'"''au nj -,
boston ana o'ner centres a'iu 10 pai' ~
a general programme LOT 'hlH,hl,ns 'n'
credit machinery OF domestic Dus'ness III
| full operation.
The same accommodation coinmenda-
! ton Is TO be bestowed on the arrange
ments swiftly made 10 place emergency
circulation at the disposal OF the banks
and between Clearing House oertifcates
and emergency currency the enorts 70
protect the gold reserve basis or credit
u L. l..N.a alb n n n