The sun. [volume] (New York [N.Y.]) 1833-1916, 1915-03-22
Dangers which Are No Longer
Feared.

ApprCheuSluus OF n cataract or sell
Ing Of securities by forcigu or domestic
holders are no longer warranted. 80
far AZ Europe Is concerned there has
been %lluuidatiun Of American invest
ments. and liquidation will go on, but
there Is plenty of accommodating evidence
that this has no tcrrofs. we neeu 70
import securities In quantity 20 make
up for our diminished TRADE imports anu
Offset our huge trade exports. We could
not possibly do better than take back
our own securities from abroad. For
e,en loans will never stand so we'll In
our markets as tho securities when
represent American values, and there
will not be much American money
which will ind more than temporary
Judgment IN equities In Europe's post
bellum future. Tho trouble with for-
elgn holdings Of American securitiee IS
rather that they will be ~relinquished
almost too slowly and too mcagrely than
that they will come at any time 100
rapidly and In too great quantity.
our foreign creditors. II we may cal!
them such. have exhibited increasing
reluctance to part with their titles 10
wealth here. The darker the situation
gets abroad the better American lnVest.
ments will look Our securities VIII
come baclt very unwillingly and only
In part, and even at thai European
capital has been taking refuge hero for
new investment, ana will seek asylum
In larger quantity as time goes on.
In tho foreign exchange market the
American dollar commands q world
premium. Our foreign trade figures
disclose he building w VI colossal cred
It's abroad by a lcngthening series or
record breaking monthly export balances.
Foreign exchange in the past week
seemed to be moving more IN our favor
than ever, and current reports or the
country's external trade show that,
despite all the novelties OF maritime
warfare, tho unprecedented volume OF
our shipments OF goods and comnodi-
ties is sustained. As foreigners cell
bacl, 10 ,s the American securities they
own the more they Will insure a con-
tiuustlou of our export trade, for the
proceeds OF such liquidation will not be
RENTED In gold, but goods. Not only
is there no tendency now for gold 10
leave the country but he metal can
not he kept from coming hero In settle
ment OF the debts which the resi- or the
world is contracting with us.
All the protection the securities mar
ket needs against foreign liquidation IS
furnished by the International money
market n buttressed by our foreign
trade. Furthermore the possibilities oil
heavy liquidation for eitNer foreign or
domestic account have only 10 be COM
pared with the banking position OF the
country 20 see how little cause there Is
for maintaining the securities market
In an abnormal condition. The visible
lending power on collateral security
which the banks now possess Is almost
immeasurable, and under the new bank
ing system il Is backed by an invisible
power of credit accommodation whin1
cannot he calculated. .
Far more securities than are AZ al
likely to come into the market could bt
absorbed IN bank loans at imrregnahIe
prices. and IN the last analysis II the
securities market, in the Wall street
phrase. wants to go down II mo ht
held up forever by a%rtiiice. II Il waits
to 20 up minimum prices, by suggestion
If nothing else, are a handicap. or
any line of reasoning II the mark"'
should have TO deal with a large anc
excited decline from present quotations
r.bouud would Ice assured. 40 investors
would bc hurt and the bank ng position
could no, be damaged. Against the Ike
lihood of any severe or p%rotracted de-
elm, there are not only the ample
facilities for the purchase OF securities
Whicg the money market affords, hu'
the arguments from the Country's Ions
range prospect for business expansion
would even now make investors ant
sprtulators welcome 4 chance 20 ge
stocks and bonds az any substantial con
cessiou from current ngures.
There would he no gain II a genera
lowering az minimum prices. 1t Is TN
theory OF the miniInunS itself which 81
= at fault. halfway measures are or M
avail. Tho minimum price level X tn
economic a~bnormAlity, and the ti'nc t'
do away with +, Is whca. as now Their
; Is no pressure on the miuiinums. Their
.1-. a1AaN IA