New Britain herald., 1915-01-30
CONFIDENCE GROWING
 IN BUSINESS CIRCLES
Suspension of Dividend on U. s. Steel
 Causes Setback 10 Market.
Especial to the Herald. )


 earnings of the company for the last quarter fell more than $S,0O0,oo0 be- low the requirements for dividends on the preferred and common stocks, passing the dividend, which repre- scented past conditions was eminently proper and should excite no criticism. Since the corporation has been rum ming for months at less than 40 per cent. of it's capacity, and since prices have been abnormally low, no sane observer expected that the dividend would be earned in the last quarter; nor could any prudent investor ex- pect the company to indefinitely con- tinue paying unearned dividends out of surplus.
 Look to New York.
 The most potent feature in the fi- nancial situation is the growing abundance of loanable funds available for short term loans. This is largely attributable to the dullness of busi- ness, although the reduction of re- serve requirements from 25 to Is per 
 offset to the latter influence the emer- gency currency outstanding has been reduced to S70,OOO,000. At one time the total issue of these notes amount ed to considerably over $30O,OO0,0O0, of which about $14O,OOO,00O were is- sued by New York banks. All of the last named sum has been with drawn, the last note being redeemed on Wednesday, New York being the first of the 43 currency associations formed under the Aldrich-Vreeland bill to completely retire them. This is another proof, if one is needed, of the strength and capacity of New York as a banking center. All the great nations of the world are now looking to New York for financial as- sistance. They are establishing big credits here, presumably for war ma terials, and our bankers are consid er- ing new foreign opportunities which l would never have presented them selves but for this European conflict. Moreover, the war will absorb all l available funds in foreign markets for months and perhaps years to | come. Ordinary capital applications in Europe are practically suspended. Thus we may expect an unusual de- mand for capital in the United States to aid foreign as we'll as domestic en- tcrprises; all of which means dearer capital everywhere, no matter how cheap money may temporarily be. January developed a much better investment demand for securities than was expected. Evidently capital had been accommodating in spite of last years retrogression and recent inn provement in general conditions seems to have induced fair buying of l high grade railroad shares, gilt-edged bonds, public utility issues and short l term notes. There was also better 1 inquiry for a certain class of indus trials, particularly those benefting from the war. The abundance of money at low rates also induced larg CT purchases of good dividend-paying stocks, which at present figures often | show d good profit where dividends l considerably exceed carrying charges. Since the first of. the year the market has had a steadily broadening tenden- | cy, and this, too, imparted greater 1 confidence in values.
 Tendency Towards Improvement.
 As to general conditions, the tend l ency is rather towards improvement than otherwise. Confidence has been ! steady growing because the i country has adjusted Itself to the war basis, because the antagonism to capi- l tai shows signs of abating, because ' our legislators are beginning to real 1 ize that attacks upon business have | been carried to an injurious degree | and because the railroad outlook has i improved by the manifestation of l more, considerate spirit on part of the l Interstate Commerce commission. Our | continued large export movement and the resulting favorable balance of trade is likewise an important factor
 inasmuch as it strengthens our ability to retain, if not attract gold. At l present the excess of exports over inn 1 ports is phenomenal; the only draw ! back being that diminished imports are having a detrimental effect upon i national revenue. IL IS much more desirable that We import merchandise than securities in payment for our ex- ports; because Europe is likely to re- sist a gold movement In this direc- 1 ton, and we do not wish an influx of l American securities. A more hopeful spirit prevails in trade circles. Abun- dant money promises to be a powerful stimulant to trade recovery. The iron industry is still very dull but it's leaders preserve an optimistic front
 It cannot grow worse and must grow
 better in time. The textile trades. are more active, and better prices are be- l ing obtained for both cotton and wool
 en fabrics. The high price of wheat is exceedingly satisfactory to growers
 and holders, the only danger being ! that values may be raised to a dan
 gerOus height, not to speak of the probability of stimulating undesira be