South Bend news-times. (South Bend, Ind.) 1913-1938, 1916-12-04
.CLEWS URGES
NATURAL LAW
GIVEN CHANCES
Declares 1t Superior to Human
Interference With Finan-
CiaI Conditions.
BY Henry Clews.

stock market Under the stimulus
of war initiation the situation had
become very one-sided. and the dan
ger Of too violent a reversal was be-
coming more and more apparent.
unless the brakes could be applied
with discretion The first check
came from perfectly natura!
cause-the desire 20 take profits.
great deal OF liquidation has already
occurred during the month Just clos
Cd. insiders In a position 20 know
being fully aware that IL was advis-
able TO lessen their holdings before
the movement had reached a cli-
max. To this extent the technical
situation has been improved especial
ly by this weeks decline.
But other Influences have also
been at work temporarily favoring
q reaction. The FIRST Of these was
the general uprising against high
prices. especially in commodities
Dear food was breeding serious pub
Tic discomfort and paving the way
for further government interference
with business. Again there were
signs that our prosperity wave while
not reached its zenith. and that ow-
ing 10 the greatly increased cost Of
doing business there viii be no
such profits in 1917 as i'm 1916. La
Dor is securing "a liberal proportion
of these profits. and when the in
creased cost Of labor. raw ma
terials and distribution are taken in
20 consideration. the margin of
profits. il will be discovered, has
beer materially affected Moreover.
high prices are already causing les
sened consumption and increased
production Thus does natural law
I'm the form of supply and demand
automatically correct abnormal con-
oitions more surely than any of the
fads and nostrums advanced by
those who believe I'm government
regulation. Natural law is still SUI
perior TO all human interference.
which usually results i'm a new set
OF ills. worse than those attempted
10 Gisplace
Money i Tighter.
Another cause or reaction was the
Increased tiShtness of money. The
expansion of credit has been enOr-
NOUS. and i'm spite of the marvel
LOUIS growth of banking resources,
the demand for accumulation was
growing at pace that rendered
slowing down inevitable The i'm
mense volume Of business at abnor-
NAL profits. the great expansion of
credit. the absorption or foreign-held
securities the huge amount OF money
invested I'm various foreign loans
and the demands Of new enterprises
at home. ali meant heavy demands
upon the local money market
Lenders and investors are conse-
quently asking and securing better
rates, I'm other words. capital. like
other things. is rising i'm value be-
cause demand is overtakng supply
and owners are enabled TO hold for
more advantageous terms.
still another disappointment was
the unexpected attitude of the fed
eral reserve board toward the forth
coming issue OF British Treasury
notes in which investment was dis
couraged Concerning the wisdom
oft this announcement there was "A
decided division of opinion. there
Icing no question about the safety
of these treasury bills. which are
simply unreneWabIe short term OBJ
hsstions OF the British government.
The advice TO bankers To go slow and
not absorb these securities in too
LARGE amounts may have been con-
servative and timely but would
have done less harm if more
oisereetly offered. The natural eff
feet of this announcement. which
was not generally understood was TO
depress foreign bonds and NJ may
Dee temporarily interfere with their
marketing i'm this country especial
ly IN view of the new issues antici-
pated early next year Should the
market for these bonds here be af-
fecied. 10 would also tend 10 check
munition orders and such exports as
have depended upon this method Of
payment Thus far during the war
this country has taken over 81. 500
100000 TN foreign bonds an amount
much less than tire annual require
ments OF the American railroads for
the same period. These sums were
not loans IN tho ordinary sense Of
the term, but legitimate payment
for munitions. more acceptable To
US IMAM AplA OF our own securities
10 is noE desirable that we take back
an foreign HOLDINGS OF our shares
since a good international market
Tor them adds tc their stability at
times Of stress az home Moreover
% is well for our own sakes 90 main
tain good market abroad for
American securities in case this
country ever meets a crisis i'm which
ir might be obliged 10 cross the At
lantic for dnanCia! assistance
ON Monday next congress opens
and a new set OF conditions viii be
faced. IL IS q short session and
there is considerable left over BUSH
ness OF an important nature that
should be finished before the new
congress comes in a year hence.
Fortunately there are no disturbinv
issues Immediately I'm sight
Money Market Haricns.
The money market continues 90
show hardening tendency. and as
ga result funds are flowing more free