The sun. [volume] (New York [N.Y.]) 1833-1916, 1915-09-13
FINANCIAL REVIEW
OF The PAST WEEK
Foreign Loan Negotiation
More Important Than New
Diplomatic Tension.
BIG CREDIT SOUGHT HERE

nothing Of immediate importance to
compare with the arrival OF the Anglo
French finance commission for confer
ences On the foreign exchange situation.
Wall Street had. nevertheless. to give
fresh attention to the aspects OF inter-
national politics. Beginning with The
sinking of the passenger steamship Hes
perian the past week provided various
disturbing matters bearing on the pro-
longed tension between the United
States and the Teutonic allies. 1t was
made clear In the Washington demand
on Vienna for the recall Of the Austrian
Ambassador Dumba because Of his med
ding with legitimate American indus
tries and in the Berlin note on the tor
pedoing OF the steamship Arabic that
time was ag~gravatlng, not removing the
Issues between the United States and
the Teutonic partnership. The discov-
cry that this was the case was unmis-
takably reflected I'm the heaviness of the
stock market toward the end OF the
week after having exhibited broadening
tendencies to rise.
Nevertheless. in respect to the dis
quieting state OF our relations toward
the European war, because OF a persis-
tent drift OF occurrences carrying us
toward an open break with Germany
and her ally. II is worth pointing out
that contingencies have long been under
examination In the financial commu-
nifty. The result has been hat certain
fundamental convictions have almost
been established regarding all possible
or probable outcomes.
In the first place It must be remem-
bered that our business and values have
been pretty thoroughly adjusted to war
time conditions and all the recurrent
shocks which they are likely TO gener-
ate as well as the various crises which
they must develop. II Is hardly likely
that anything In the nature OF war &C.
currences can do more han temper still
further the strength OF this country or
that periods OF stock market or business
check or arrangement will prove any
thing else han preparation for the more
forceful operation OF tendencies already
, at work.
As to the chanccs OF a complete break
ms of OF our political relations with
Germany and Austria, with a consequent
modification OF our neutral status to
a compulsory activity OF sympathy with
the Allies only n little short OF actual
belilgerent association with them. IL has
beer doubted for months IL the Imperial
German Government wanted anything OF
the sort to happen. II may very well he
that Germany has contempt for any
military power which We could exert
except after SO long n time as to b.
hardly worth taking into consideration
Yet Germany thoroughly understand
force of any kind and il understand
quite clearly the enormous force OF the
economic power of the United States
n what IL would mean to have thi.
Power engaged on the side OF the Al
lies.
Again. the line Of financial rea soninr
on these subjects has led to the conclu-
sion that should our diplomatic rela
tons with Austria and Germany bF
broken the prompt effect would he to
give irresistible Impetus to the move.
ment that Is growing up to place thu
United States in a state OF preparedness
against war. As IL is now this essen
tial element in the ingredients OF pros
perity Is lacking. Despite more than a
year Of a war. the md of which no man
can foresee. we have taken no steps n
safeguard American prosps rity, and what
this is likely 10 be is suggested by a re-
port made last week In Great Britain
respecting the International situation A.
ter the war. According to this report all
other countries will be at a disadvantage
IN comparison WIN the DHlteu oldtcS,
which will nave the cream. while we
tGreat Britainl shall have to be content
with milk. the other ~belligerents
with SKINNED milk" Should the United
States. he OBJ. ged by circumstances 10
adopt swift measures to prepare against
war, the fact would also contribute ma
terially to y feeling OF financial and
business confdenc. regarding the secu-
rity of our prosperity.
In the last analysis the financial com
munIty has come to believe that should
the United States be drawn into the war
because of the descent OF Teutonic po-
litical stupidity to the depths OF folly
all the war time factors which have
been working for our industrial and
commercial activity and the expansion
Of values would be tremendously en-
HANGED. An interval OF extensive UNI
settlement could doubtless be hardly
avoided. but shortly 1t would become
apparent that engagement In the Eu-
ropean wal would mean for us chiefly a
vastly accelerated economic momentum.
Primarily we would forthwith proceed
to furnish huge financial assistance to
the Allies for belligerent purposes, not
merely for the support OF our own ex-
ternal commerce.. while our industries
would be put to work to capacity to pro-
duce a %stupendous output OF war mu-
nitions for export 10 the Allies. Az the
same time our own expenditures and
endeavors In the field OF military pre-
paredness would be added TO the forces
now at work in our economic field.
Foreign Exchange Negotiations On
Whatever the bearings Of foreign poll
tics may be the arrival OF the Anglo
French lance commission was the hap
pening OF paramount Importance last
week. The foreign exchange market
where the movement OF goods and com
modities and international Is
financed. has been growing more and
more unstable and its loss Of stability
impairs trade All the world that for
merly wanted pounds sterling In Lon
don ManIa less and less of them now