Evening star., 1915-04-11
FINANCIAL-LOCAL AND OTHERWISE.
BY I. A. FLEMING

paIfies to defeat any measure of this
character are very noticeable.
| The federal reserve board has grant
ed many national banks the right to
engage in trust company privileges.
and the board is doing all in it's power
to secure further assistance in this
line, indicating that it would like to
see favorable action by the New York
state legislature in the matter of Civ
ing state banks the right to avail
themselves of the privileges.
In Washington the trust companies
object strenuously, and brief in the
matter is being prepared. 1t is within
the probabilities that the courts may
be asked to pass upon the question be-
! fore it is finally agreed upon.
No Time for New Financing.
The National City Bank of New York
has this to say with regard to new
financing:
"Of course nobody is able to forecast
all the effects of the war, and this is a
great restraining influence. Nobody
knows how long it will last, but SO
long as it lasts there will be great
outpouring of government securities
for the public to buy, and a t the same
time great decrease in the produc-
tion of wealth. 1t is quite possible that
after the war is ended the recuperative
powers of these nations will prove to
be much greater than is now realized, !,
when we remember that the debt of
the United Kingdom at the close of the
Napoleonic wars was greater than it
was at the beginning of this war. and
consider how enormously great is the
productive capacity of the modern
community. we are inclined to think
that this will be the case: but at all
events there is now constant creation
of government securities. and until
they are absorbed and paid for they
must compete in the markets with all
other applications for capital In 9TH
er years, London. Paris, Berlin. Ham
burg, Amsterdam. Antwerp. Brussels
and other cities that might be named
have been centerS of activity in the
promotion of new enterprises all over
the world. They We're constantly get
ting together the capital to build rail-
ways. port works, water works, cleo
trical plants and to open mines. plan
ia tionS and establishments of various
kinds. all of which meant expenditures
for equipment and labor Now these
markets are closed to such financing,
and they are bound to sell rather than
buy such securities. While our securi-
ties have not been coming from ESl-
rope in any sensational way, there is
a moderate movement all the time.
Choice old bonds. secured by UNDER
lying mortgages. such seldom
seen in the market, are coming out of
the strong boxes. These conditions are
not favora BILE to raising capital Tor
new underta kings. Why manufacture
new securities for markets already
gorgedo If Europe offers our bonds
and stocks in volume sufficient to hold
prices around present levels, will not
investors prefer to buy old and sea-
soned securities and government obli-
cations rather than go into new enter
prises in unsettled times?
an every notable era of expansion
this country has ever had the work
done by the railroads has been the
leading factor. but the railroads are
not in position to make heavy expendi-
lures at this time. The cost of rails
ing capital is too high, and the status
of private capital in railways is too
unsettled for new development in this
line.
.As result of all these conditions
and others which need not be men
toned here, there are practically no
offerings at this time of securities that
represent new work, and few new en-
terprises are being inaugurated, ana
so it is that many people are out OF
work and numerous works that Il Few
years ago were busy in turning out
construction materials are now free TO
take contracts for shrapnel- They have
their income now from the proceeds of
war bonds instead of from the pro-
ceeds of industrial issues.