Daily capital journal. (Salem, Oregon) 1903-1919, 1915-01-19
PASSING THROUGH THE GREAT CRISIS

The annual number Of Dus Review, issued by the
great commercial agency prints summary to the un-
usual conditions and events OF the year l9l4 IN the to
lowing concise editorial which is worthy OF reproduction
after passing, between July and December through
nearly every possible experience Of adversy except that
of complete collapse the new year opens with business
the United States rising above depression ana CONFRONT
ing the future with new confidence and with clear signs
of developing activity Since the beginning Of the modern
system of credits in the middle Of the seventeenth cen
tury there has been succession at regular cycle inter
vals of financial upheavals but nothing approaching IN
violence and extent the overwhelming convuson OF the
markets in 1914 the result Of the sudden outbreak OF
the European war; Moratorums in practically every ma
ton abroad the closing OF the stock exchanges IN every
important city, confusion in all the processes OF money
and exchange the commerce OF the world demoralZed
100000 tons Of shipping withdrawn from the ocean
thoroughfares of tradehese were some OF the instant
developments Of the war; the declaration OF which led at
once to gold run the historic Bank OF England stop
ped only by the prompt action OF the British government
The United States although neutral country, suffered
almost as much in business way as the nations actually
engaged in the conflict Three things rendered our posi-
ton especially serious The first was that this is debtor
nation vast quantities Of the stocks and bonds OF our cor
pOTatons being held abroad the second was hat we mao
practically no merchant marine in the foreign trade and
our commerce seemed to be threatened with complete eX
tinction while principal crop-cotton-though large
beyond precedent cut off from Its greatest foreign
consuming markets. But with admirable Selt-c0ntrol
courage and wisdom the national government with the
patriotic cooperation Of bankers and merchants at once
planned and carried into effective execution great meas
ures of relief Foreign ships admitted to American
registry; government risk insurance was instituted
$00000000 gold pool formed to protect the foreign
exchange market another fund Of $l30OOOOOO was rails
cd to facilitate the carrying and marketing OF cotton and
other emergency steps were taken While these heroic
measures were being conducted the nation proceeded
with the establishment Of its federal reserve bank
system which was successfully naugurated with all its
facilities for the conservation Of reserves and the wider
extension Of commercial credits. Feeling its way cau-
tousy the securities market gradually overcame its early
prostraton and in December the New York and other
stock exchanges of the country re0pened without
evidence Of extensive liquidation while the cotton and
coffee exchanges also resumed business Money became
easy and exchange more normal and the whole financial
machinery of the country resumed its regular and order
ly movement.
Naturally as result Of the extraordinary events
abroad domestic trade suffered severe depression bank
cearings and railroad earnings declined heavily; the
number of failures multiplied and unemployment with Its
attendant evils increased While the entire country was
affected certain sections suffered less than Others On
the whole the West which was benefited by the big grain
crops notably the ecord-breakng yield Of wheat mar
keed at high prices most favored while the South
was severely hurt by the cotton collapse, and the East by
the protraon of foreign commerce and the suspension
of the markets for securities. AS the year closed how
ever so far had the markets adjusted themselves war
basis that the great conflict abroad began to lose of
its overwhelming significance and our domestic problems
came more to the front Exports grew to large propOr-
tonsevely available ship being pressed into service at
high rates for freghtand the normal balance Of trade
in favor OF this country reesabshed rendering UNI
necessary special arrangements which otherwise would
have had to be entered into to prevent excessive drain
Of gold from this country In the last month Of the year
the decision of the Interstate Commerce Commission in
the rate case was a constructive development Of much inn