The Bridgeport evening farmer., 1915-09-08
BANKER WA. LAW TELLS OF ROMANCE
 OF WORLD CHANGES
Says Production is Increas- ing and Unemployment
 Steadily Decreasing.
Advises State Banks to Go operate in Federal Re
 serve Fund.


 the presidential address of William A. Law of the American Bankers Asse- citation, which das delivered at to- days session of the bankers conven- ton.
 President Law, who is the head of the First National Bank of Phila- delphia, viewed the worlds. economic situation from several angles. In part he said:
 we are meeting in the midst of strange and stirring days, saturated with the romance of world changes. In Europe war has continued it's pro- gress with increasing military feroci- ty, econmic devastation and the loss of human life. In America the situa- tion has Served to. reveal the marvel ous material resources of the United States.
 During the year you have seen sterling exchange rise to it's maximum price of two generations and sink to its minimum. You have seen in terest rates uncomfortably high and again discouragingly low; you have seen wide fluctuations int the values of our staple products; you have seen economy practiced till. as a conse-' quence. retail trade suffered severe 1y.
 Manufacturers in many branches have not been able simultaneously to
 
 changes, the unusual shifting of prices of both raw material and pro- ducts under war conditions, and re- gently the demoralizing competition for skilled labor by the contractors for war supplies. As soon as busi- mes is resumed on a large scale we are going to face most unusual la bor conditions. Practically no inn migants are coming in at the present time; our normal movement averages about 100000 per month. R i4
 Those industries concerned in the production and distribution of food stuffs have been least injured. Leath- tomobiIe industry has been surpris- ingly stimulated, due in great meas ure to the war On the other hand, textiles have been irregular and diff ficult Construction and all products ,purchasab1e by the railroads have been slow and dull. Our coal tonnage exceeds the combined tonnage of the products Of agriculture, forests. manufactures and animals. The suc- cess of many of our railroads. there fore, depends upon manufacturing ac- tivity. The railroads/hav been suf- fering from a four-fo1d burden of de- creased tonnage, decreased freight rates and the increased costs of la Dor and money, but they are pluck
 
 'sAs a whole, production is irresis- tib1y tncreasing;; unemp1oynent is slowly and steadily decreasing; dis tribution is quietly threatening.
 .'The unprecedented prices for some of our agricultural and industrial pro- ducts have 9revitalized stagnant la bor generally, besides rengthening the position of our most important interest-farnning The United States has grasped it's unique opportunity to become a larger factor in interna- tional finance and commerce. Last fa11,l when Europe needed theS sur plus of four two most bountifu1 crops, wheat and cotton, we harvested for the first time, by rare coincidence, over 93O,6eO,0 900 bushels of wheat and gathered over 17s0O0,0O0 bales<of cot ton; hence our amazing interna tional credit trade balance for the year end- ing June SC, 1915, amounting to $1,- 0e4, 900, 900. This immense balance has created serious exchange probzs lems. But let us not forget that over $22O, 100000 of this export excess as compa with the previous year was caused by the decrease in imports of raw material in connection with our retarded industrial activity accom- panied by id1eness and suffering on. the part of wage-earners in many of our manufacturing. centres. /
 Several of our strongest assump- tions have proven erroneous. Our stock ofg old was not exha hsted by foreign shipments; in fact, interna- tiona1 exchanges gradually turned in our favor. Our cotton exports were not cut in five as predicted. but ex- ceeded 92 per cent of the previous years volume. Our copper industry was not ruined but has been stirnulat- ed. Our stock exchanges have not been overwhelmed by a flood of dis tressed American securities sold at sacrifice prices by European holders, but we have readily absorbed all of ferings. At present the iron market the barometer of our national trade, is strong and active. The New York Stock Exchange is vigorously ce1e-. brating its new lease upon life with a: speculative orgy is some issues which is causing thoughtful men no little concern. This is caused mainly by the unprecedented plethora of funds. congested in New York City, where. funds were loaned as low as. 1 per cent on call.
 "On November 1e, 1914. the Feder- al Reserve Banks. were opened, start ing too late to afford relief during the financial stringendy, as the re- tirement of emergency currency was by that time in full swing. Unfor-, tunately, this contractio was not suf- ficient to meet the reduced require rnents of commercial depression com bined with speculative inactivity, and for the past six months at least we have been suffering acutely from re- dundant currency a condition in many respects more dangerous than stringency.
 t'The Federal Reserve system had not yet been fully tested. The coun- try still awaits, the action of two most important factors in it's operation, namely, the entry of the State banks ernment deposits from the independ- ent treasury. It cannot be questioned that all commercial banks, no matter where their charters are derived, to- gether with the Secretary of Treasury, should finally cooperate with the sys- tenn if we are to coordinate all e1e-