The Caldwell tribune. [volume] (Caldwell, Idaho Territory [Idaho]) 1883-1928, 1915-09-10

gold and securities arrived in New
York from the British financial CEN
ter, sterling exchange registered its
lowest acceptable quotation, thus
dem onstrating the utter inadequacy of
gold imports to stem the tide of fall
ing exchange rates. This is very
easily explained. The latest state
ment issued by the federal department
of commerce shows that while the ex-
cess of imports over exports for the
month of July amounted to $685.
100000 the excess for seven months
ending Juy 81 was 1901, 100000. The
most conservative estimate of the
gold imports into this country from
London during this seven months
period is about $l50,000,0O0, leaving
more than $800,000,000 to be provided
for either through the return of secur-
tiles or through special credits.
And this is only half of the prob
lem. Only small portion of the
war orders" thus far placed in this
country have as yet been filled by act
ual shipment, and the details of the
financing of this tremendous trade
have yet to be worked out Until this
is done we may logically expect more
or less nervous tension in the interna-
tional money markets.
The Generalization of the market
on Tuesday, when demand sterling
broke from $500 to $4.57 was the most
severe and dramatic market decline
which exchange dealers in this coun-
try have ever experienced. A drop of
So cents in the value of the pound
sterling in single day is so far be-
yond the comprehension of dealers
that no one is willing to predict at
what point the market will find bot
tom. The English pound is now sell
ing at 81 cents below its normal quo
tation. The exchange situation has
thus become an important factor in
the stock market, and it is held to be
expert opinion that no new commit
ments should be taken on until per-
manent improvement is definitely as
sured.
The shipments of gold may there
fore be regarded merely as temporary
makeshifts, pending the arrival of the
special representative of the British
and French governments, who will
confer with our own bankers on the
subject. On one point, however
there is perfect unanimity of opin-
ion; that is that the restoration of the
pound sterling, the franc and mark to
normal value is an absolute and posi-
tive necessity. A large credit may or
may not be the solution of the prob
lem, but business men of the United
States may rest assured that satisfac-
tory arrangements will be made in
time to prevent any unnecessary in.
terruption in our trade with the Eu,
ropean countries. A prominent inter.
national banker makes the following
accurate comment: THE bringing ir
of gold from Europe will not clear uI
the foreign exchange situation. Ir
my judgment this can only be done
through extending credit to Great
Britain and perhaps to France anC
Russia on large scale. This i.
bound to be done in due time There
are good many difficulties to over
come, but they are not insurmount
able. I am not in favor of loanine
large sums to those countries will
American securities as collateral.
would not be opposed to buying thos,
securities back from Europe, but
think that the loan or loans should b,
arranged on some other basis.
Domestic Money.
There is perhaps no more contemp
tible specimen of humanity than tn,
miser. The man who boards his saw
ings and hides his surplus in tin car
or the chimney hole not only robs hi
money of its earning power, but de
prives society of the capital that is S,
necessary for the turning of tn
wheels of progress. When, however
man finds that his funds are accu
mulating to such an extent that he i
unable to direct them into prohtabl
lines of investment, he can hardly b
censured for existing conditions. Il
fact, it would be quite unfair to iabe
him miser
The banks of the United States ar
confronted with such a condition a
this time. The Comptroller of tn
currency has already called attention
to the fact that the national banks o
the United States on the date of thei
last reports, held $780,0O0,000 cash i
their vaults in excess of the amour
required by law. The New Yor
clearing house last week reported tn
excess reserve" of its members to b
l9AO7,|SS,oCO, compared Win an az
verse balance at a corresponding dat
last year. These excess cash holding
are not from choice. but from neces
sity; from our inability to find prope
avenues of profitable investment 70
our rapidly increasing wealth. By "in
vestment" we do not refer specifcall
to stocks and bonds. but may includ
the many commercial and industria
opportunities which are vital concom
itants of our national progress Their
is therefore no cause for criticizin
the banks for their excessive surplu:
but rather to cooperate with them i
directing these funds in safe and pro
ductive channels. 1t is believed tina
our people have been saving thei
money to an extent that means a grea
deal in the WAY Of reserYe hnYin