The Washington times., 1915-11-14
4. S. Realizing Effect
OF War Stimulation
Primary Markets Receiving Their Returns and High
er Wages and Larger Profits Prove I'm
petus to Buying.

America IL today beginning to realiz
the full effect Of such stimulation o
trade as has resulted from the Euro
pean war. For months the great In
dustrial Institutions which have hel,
the contracts for goods and wares whicl
the foreign countries needed have re
flocted their benefits through increase,
~rnings and larger dividends: today
however. the primary markets are re
ce.ving their returns. Higher wage
and larger profits by farmers and
miners have given n remarkable impe
tus to retail buying.
Another reflection Of the effect Of tn
war Is found In the stock market
Several months ago there was VIVA
might almost be termed wild specula
lion In securities which had not de
reloped valves attached to them by th
nublic. Severe shade-downs have beer
much recently to put the market on ,
firm basis and now that vast wealth
end great plenty Of money which hal
rome with the stimulation Of bushes!
Incident to the war Is finding its wa,
into a broader stock market.
In discussing general business condi'
tions the NeD York Times Of today
says:
In all discussions relating to differ
ent branches Of trade, whether do
tor Is still always the great conflict
abroad. At the outset the principal
thinss that claimed attention were
those growing out Of restricted i'm
ports and Of the ability to produce
and send across the seas what the
belligerents REQUIRED. Recently II
has become necessary to note more
particularly the reflex action on
home conditions OF one sided trade.
accompanied by feverish activity in
number Of large industries. the es-
tablishment Of new ones to make
abroad. and q plethora of bank re-
sources far exceeding all possible
business requirements. One Of the
first effects of the new conditions
has been to overcome the economical
tendencies which had almost become
fixed since the 1907 panic. The great
cr employment Of labor at higher
wages and the large profits made by
the farmers and miners have
helped to give a remarkable impetus
10 retail buying. which in turn has
extended to the primary markets.
The increase in demand and broad
enine OF purchases have had their
natural effect In raising prices In
things to wear and things to eat In
such a manner that every one In
this country has felt the effects OF a
struggle thousands Of miles away.
The NeW York World predicts con :
.inuance of heavy speculation. but
foresees q saner selection Of the me-
Ciums Of investment. 1t says:
Fictitious values were smashed to
raids on the war stocks during the
early part of the week In Wall
Street. and while more wholesome
conditions have been restored. the
opinion among the more conserva-
tive bankers Is that the work of re-
fcientiy thorough. There remain
many pyramids that have been only
partially razed. and until they have
been completely eliminated 1t can
market situation exists. Fortunate
ly. the public Is now beginning to
select its speculative mediums from
class Of stocks that make an ap-
peal to Its common sense rather
than to It's ina gination. and with
the return Of reason there will come
in time the stock markets legiu-
mate response to the country's re-
marksbly strong financial, COM
mercial and industrial position.
Those who are inclined to advise a
somewhat cautious attitude In spec
ulative commitments until the tech
nical position OF the stock market
has been further strengthened have
not for moment abandoned their
optimism as to its ultimate course.
ist In the financial situation are
essentially constructive. They are
OF a character to encourage specu-
lation rather than to repress 1t.
The ablest hnanciers agree that We
are entering upon period when.
because Of the enormous imports Of
gold and the piling UP of idle funds
In the banks. the purchasing power
OF money will steadily decrease.
Investors will be compelled to seek
higher rate OF return from their
funds. and will be inclined to liqui-
date bonds with low income returns
and seek securities whose yield Is
more attractive, though less COM
pltible with safety.
In other words. we are on the
threshold. II present conditions con-
tinue to exist, of a period Of infla-
tion that is certain to engender and
foster q spirit Of speculation which
will hnd expression In a broadening
stock market, increasing activity in
real estate at rising prices. and in
the encouragement OF new enter
prises In every direction. Such
spochs are inevitably followed by
severe reactions, X they do not cul-
inmate In financial cataclysms. and
yet they have proved to be the
milestones OF the country's greatest
progress and development.
That tho technical position Of the
market has been much improved is also
tho opinion expressed by the NeD YorA
Press. Commenting on the market, II
Gays:
Strength in the war stocks in the
last two days has encouraged ac-
tive public buying of the various
members of the group. In the re-
cent decline an enormous number
OF weak accounts In the war issues
came upon the market and in con-
sequence the technical position OF
speculation was strengthened. while
opportunities were presented for the
purchase OF attractive stocks at rea-
sonable prices. Brokers' advice yes
terday Indicated accumulation of
the muntion shares by a more sub
stantial class of operators than re-
ported in many weeks. especially in
Baldwin. American Locomotive,
American Car and Foundry, Ameri-
can Can. and Westinghouse. The
steel shares are In demand from
houses which represented large H.
l.l tntn flnnr nf