Daily capital journal. (Salem, Oregon) 1903-1919, 1915-10-07

. closing Of arrangements for the new
. Anglo French credit loan has been ac-
: cepted as an influence of far-reaching
: Importance. The terms of this loan as
: officially announced proved to be much
; more inviting than had been expected,
; and the prospects of a satisfactory sub
|: scription have correspOndingly i'm.
proved 1t seems quite fair to assume
that in view of the large concentration
OF important American banks and
bankers that have become identified
with the underwriting of the loan, no
stone will be left unrurned to make it
a success.
The loan, il may be observed, Is of
greater Importance to the national ac-
tiyities Of our own country than in its
relation to the conduct of the European
war. Its main importance, as | have
recently stated in these advices, lies in
the fact that the export trade of Am
erica is not to be severely handicapped
by protraeted period of excessive
weakness in our international ex.
changes. While only Great Britain and
France are directly interested in the
negotiations, the real influence on Am
erican trade is much wider and much
more important Besides our own trade
with the countries named, the demoral
ization in exchange rates means inter
ference with trade that is financed
through London. A very considerable
amount of this class of business is still
being conducted. AS everybody knows,
dollar exchange, while rapidly attain
ing worldwide popularity, is still quite
in its infancy. Under most favoring
circumstances it will require years to
develop on an important and world.
wide scale. But with the restoration
Of our international exchange rates
there will be less incentive for foreign
interests to avoid the American market
when purchasing their supplies of food
and of clothing and all other necessi-
ties This is of great value to our ag.
ricultural sections, especially to the
west, where such large crops have been
successfully raised and are now for
practical purposes ready for our home
and foreign markets. Had the loan not
been arranged there would have been
very strong encouragement for foreign
buyers, where they could not entirely |
delay purchases, to obtain their sup.
plies from other countries, leaving the |
United States last upon the list az |
source of supply. This quite naturally
would have been source of depression |
on the prices of American grains and
provisions. Beyond this 1t would have
placed American grain products in the
list of those that would be most sub
ject to the competition OF Russian
wheat, which will be released in such |
large quantities when and if the allied
armies and navies are successful in op- |
ening the Dardanelles. There are as yet |
no data on which to base definite
opinion that the operations against the
straits will be promptly successful. 1t |
ls quite obvious, however, that the task |
has been undertaken as most serious
one and that it will not by any means
be lightly abandoned.
The announcement Of the terms of |
the loan and the Indications that it |
Will be so successfully distributo6 |
proved an added stimulant for the So |
called war stocks. Operators were en-
couraged to believe that the improve.
ment in the international exchanges
would mean the unrestricted placing OF
war orders with American manufacture
ers so long as the European confic
continued, But there has nevertheless
been noticeable drift in the trend of
operators toward the more conserva.
tive Investment properties, particular
ly the railroads. The delay in killing
frost has been favorable feature so
far az the corn crop is concerned, and
that class of grain will shortly be NOV.
ing IN its various forms over the rail
roads on u particularly large scale. 1t
IL not so much the movement of the
corn itself that constitutes such an i'm.
portnnt source of railroad traffic. 1t
is tho various forms of manufactured
products in which the corn Is utilized
that is the important item.
Still another influence in the week q
market has been the reports of various
combinations among the independent
steel manufacturers. Definite plans
nave not yet been announced. There,
however, seems some really substantial
basis for the reports. With the cou.
tnued expectations of American food.
stuffs and all kinds of products the
balance Of trade will continue to move
strongly in our favor. This will un.
doubtedly encourage further selling by
foreign holders Of their American secu.
rites, though with the prospective sfe.
storation of foreign exchange rates,
one particular incentive for such sales
will be measurably reduced. Meanwhile
the money situation at home continuesI
one of great redundance. Thus far the
news of the subscriptions to the $500.
0oO,OOO loan that are in prospect has
not affected money rates adversely.
The funds are not to leave the coun.
try and to large extent the subscrip.
tions will constitute movement Of
funds between banks and trust com
panies. Nevertheless II Is not unlikely
that when the subscription books are
opened there may be temporary
strengthening Of interest rates. This
feature is not likely to be more than
temporary and will hardly constitute
q depressing influence as a stock mar.
ket factor. The days Of sensational ad.
vanccs in rates for money passed when
the new banking law came into opera.
tion, Funds will continue available
for all legitimate purposes. Lenders
are, II is true, showing some disposi.
ton to put curb upon the SENSATIONAL
movement shown by some Of the indus.
trials that are usually associated In the
public mind with wa, orders. But this
same restraint is not showing itself in
thA nan rlak a.. N xsknlN an. III