The Washington herald., 1915-01-04


the other half is being held for better
prices. The losses sustained will be
borne by Texas and will not reach be-
yond the limits Of the State. as the banks
and jObbing institutions are well able
to take care of the situation.
The spirit Of conservatism that has
prevailed for the past few months Is
growing continually and the outlook for
the future is a hand-tO-mouth policy at
best, affording a volume OF trade equal
to twO-thirds to thrce-quarters of former
seasons.
1t is our hope that with individual
finances from the new Reserve banks
gradually getting into the trade chan
nels of the State conditions will become
somewhat easier than at present and the
commercial world Of Texas is preparing
to take care OF all reasonable REQUIRE
ments of our farmers in a close and con-
servative manner. This alone will ef-
fecttvely curtail the cotton CROP for 1915
The local conditions of Galveston are
quite satisfactory. A large amount of
ocean tonnage has been contracted for
the next few months, cotton is COM
menCing TO move freely with a splendid
demand, and our labor is keeping busy
and We look forward to a fairly salts
factory season for next spring and sum-
mer.
l4lINlnE.
Ellison A. Smyth. president Cotton
Manufacturers Association. Of South
Carolina, thus describes blockade in
staple crop:
The depression in the South in busi-
ness is gradually passing, but locally our
farmers made a great mistake in not
meeting the prices for cotton earlier in
the season and in forcing the local cot
ton mills to go to other States for
supply of cotton.
In the meantime. the market has de-
clined over cents per pound, and the
unwillingneSs of the farmer to sell his
cotton and meet his obligations made a
serious situation for our bankers and
merchants.
During the last two weeks cotton has
been moving more freely but Southern
bankers and cotton manufacturers ap-
preciate highly the forbearance and gen.
eTous treatment they have received dur
ing the last three months from New
York and other Northern bankers, for
without the forbearance with which they
were treated there would have been
brought about a very serious financial
situation.
Cotton goods are selling on a basis of
cents for cotton, which is a cent be
low the local cotton market, but one ray
of sunshine has come recently through
the movement of export goods to the
Orient and to the Red Sea that had been
held up for months on account of the
inability Of exporters to forward ship
ments that had been ready, owing to their
inability to negotiate bills of exchange,
secure tonnage, or pay the exOrbitant
war insurance rates. In addition to this.
new business for export has been in
10 al nd hA nj
cotton will enable manufacturers to re-
gain largely the export trade and extend
their business in other foreign countries.
In the opinion OF many, the cotton
crop will not prove as large as estimated,
and the millions of bales on Southern
farms exposed to the weather will show
greatly reduced spinning values, owing
to the damage, or what is known as
country damage" caused by the rains
and SHOWS. The cotton acreage next
year will be reduced, on account of the
large acreage that has been sown in
wheat, and the inability of the farmers
to get advances to run their farms for
all cotton. which is an expensive crop,
the inability to buy fertilizers and the
absence of mules and horses. the sales
of which for war purposes have been
very large throughout the South.
The European war has prevented the
being seriously felt, as conditions have
been abnormal.
No Sign of Apprehension.
Emory W. Clark, president First and
Old Detroit National Bank, sums up the
situation thus:
The country has gone through the
troublesome period since August with
great credit to the nation, and while
the present situation does not offer any
convincing evidence of an early resump-
ton of business on large scale, We are
moving forward on strong and conserv-
ative lines Our industries. as a whole.
must expect to be adversely affected by
the uncertainties surrounding the out
come Of the war and by the tremendous
economic waste which is daily destroy
ing the worlds buying power by mil
lions of dollars
Fortunately. We are free from entan-
clements with the nations at war, and
the confidence which asserted itself In
our business life after the first great
shock is, growing from day to day.
The outlook in this section for the
coming year promises a larger manu-
featured output than during 1914. Our
industries generally are further in
trenched financially, and nothing ap-
pears on the horizon at this time to
cause apprehension for the coming years
business.
Mr.. FOrgan Optimistic.
James B. Forgan. president First Ma
tionaI Bank. of Chicago, says in a year
end statement:
During the first half OF 1914 business
for a variety of reasons was restricted
in volume and generally depressed, in
Of which the money market
was irregular and unsatisfactory The
Of tIa OF in history
at the beginning of August threw the
financial affairs of the world into cha
otic condition. An unprecedented and
upheavel of international
commerce took place. To bridge the
time until they could adjust themselves
to abnormal conditions the banks In
Chicago, as elsewhere, had recourse to
the use of temporary credit instruments
in the form OF Aldrich-Nreeland currency
for general circulation. and to the is
suance Of clearinghouse loan certificates
for the settlement of balances among
themselves. Owing to these and other
measures the year passed
out with practically normal financial con-
dltiOns and 9TH good business out
look for the coming year. The banks are
in good shape as to their reserve strength
and should make a satisfactory showing
as to their profits for the year.
Bankers should continue to conserve
their resources until the ultimate effect
Of the conflict on American securities Is
fully realized. Nothing could be more
unsound than to attempt to boom domes-
tic business by undue expansion of cred
dit until we find out what may be re-
1uired of us in caring for our foreign
and for our securities which
may be thrown on our home market. I
do not mean y this that We should