New Britain herald., 1915-02-13
INCREASED ACTIVITY OF NEW FINANCING
Shows Intrinsic Business Conditions
 are Improving, Says CIcWS.
Especial to the HeraId.)

be recorded than the increased activity of new financing. Immediately fol- lowing upon the opening of the war there was a sharp contraction in new capital applications, the total of which recorded for the last seven months reached about S4S0,0O0,O0O. or $166, 900 less than the same time last year. The lowest m month was September, when applications fell be- low $2S, 100000. Recovery has been gradual, and in January the total rose to $127,000, 0,000, or only s3,000.- GOO below the same month in 1914; while the total announcements thus far in February already exceed Sl6O,O0O,OOO bonds. Total issues in February last year were $176, 6,000,00O. A considerable portion of current new issues is for the purpose of adjusting maturing obligations but the signifi- cant feature is that these operations could not have been successfully car ried through a few weeks ago; while TOW it looks as if other important flotations will follow, so that this February will considerably exceed the same month a year ago. While we are facing beyond doubt an urgent demand for capital, it is not likely under existing business depression that there will be any great demand from really new enterprises. This year an extraordinary volume of short term notes and other obligations mature, which will have to be ex- tended or turned into fixed forms, the latter method being the most prob able.
 Very Significant Trend.
 There is also another and very sig nificant trend in the new demands for capital. which is that nearly every important nation in the world except Great Britain is either borrowing in the United States or willing to borrow This is due to the war. London has practically retired as the worlds banker for the purpose of devoting its whole financial resources to conduct of the war. Of course, this with drawal is temporary, yet it offers an unusual opportunity to the United States, because New York is now the only free capital in the world and hither will come a large portion If the new capital applications. At present the war is being carried on by all belligerents largely by means of shcrt term obligations, although Great Britain is aiming to pay a con- siderable share as current expenses. Later on these war debts Will De turned into more permanent forms of investm ment All of the belligerents have established extensive credits in tllis market, for the purpose of pur- chasing war materials, immense quan- titles of which are being steadily shipped to Europe. This movement will continue as long as the war lasts, and is proving very vital factor in swelling our exports, large quantities Of ammunition, automobiles. clothing, etc., leaving American ports every week Our exports are being further expanded by heavy shipments of wheat, and cotton. Meanwhile our importations are running very light, owing to the interruption of supplies by the war; and in the week ending February 9th, the excess of exports over imports was estimated at $31,- oOOOOO As a result of these inter national operations. foreign exchange has again declined to the lowest point since 1907. Gold imports from China and Canada are coming at a moderate scale, and larger am cunts would fol- low were it not for the establishing of
  It is estimated that the present in ward movement may run as high as $1O,OO0,OOO, but we do not need gold while Europe does, and under exist ing conditions it is more advantageous to Europe and to the United States to allow these credits to stand. We have thus become "a creditor instead of a debtor natiap.
 Abundance of Loanable Funds.
 The most impo1ant. local factor Tn the financial situation is abundance of loanable funds at reasonable rates. This is due partly to the dullness in trade and partly to the satisfactory workings of the Federal reserve bank ing system. There has been steady expension in loans which now stand at s2221, 100000 against $2,1SO,000,o00 at the opening of the year. Bank re- serves have declined somewhat in con- sequence. but the surplus last week was still above $14O,O00,O0O. Invest ment conditions have improved as sh own by the ready absorption of really high grade bonds and stocks. Some of the latter are selling at very low prices, compared with current rates for interest. Stock exchange values have been subjected to sharp fluctations. The passing of T.. S SteeTs dividend and announcement of the New York Centrals new issue were both signals for bear attacks, all though they represented conditions al ready passed. There was some fear also that the Canadian Pacific divi- dend would be reduced, but these ap- prehensions proved unfounded. The possibility if an extra session for the purpose of passing the ship purchase bill is an unsatisfact ctory feature, inas- much as the nation will be glad to sec congress adjourn at it's appointed date