The Caldwell tribune. [volume] (Caldwell, Idaho Territory [Idaho]) 1883-1928, 1916-01-14

self not only in security values, bu
IN the regular channels of retail trade
in the decrease of unemployment, anC
in the raising of the scale of daily
living of all people, especially th>
working classes. 'Tis true that the
prices of commodities (the cost of liv
ing) will automatically seeG a higher
level, but not in the same degree a:
| the rising scale of American CONNER.
cial prosperity. Good times mean
high prices, but the law of perfect
equation need not necessarily govern
| the case.
Money Markets.
Present indications are that the pie.
thora of money, which during the sec
ond half of 1915 constituted such a
vexing problem for our banking insti-
tutions, will not be in evidence to such
a prominent extent in the coming
year. Already the banks in the re-
serve cities of the Middle West report
an increasing demand for funds from
their interior correspondents, both for
agricultural and industrial purposes
The banks of New York City are now
holding in their vaults a supply OF
gold and currency far in excess OF
the legal requirements, but, unless all
present indications are deceptive, this
excess money will be greatly reduced
in the coming year.
Rates for money in the New York
market this week very emphatically
point to this conclusion. On Wednes-
day Of this week loaning rates OF" call
t~ DO
highest rate recorded in over year.
The average rate in 1915 was below
2 per cent. Time money rates have
not as yet shown any decided inclina-
ton to advance, but it is freely pre-
dicted in two or three months from
now the rates will be one per cent
higher than the 1915 average.
While sterling exchange for the
past six weeks considerably strength
ened, exchange on Germany during
the past week dropped to the lowest
point since the beginning of the war.
Demand bills on London this week
sold at 4.74H and cable transfers a,
4.75H. German marks, on Tuesday
of this week, declined to rs (for four
marks), or at the equivalent of 1874
cents per mark, compared with the
normal par of 1874 cents. The decline
amounts, accordingly, to Fl per cent
at present prices. Exchange on Aus
tria was also at low point. Kronen
were quoted at 1920 cents, against the
normal value of 20I cents. The weak
ness is explained by bankers with
German syrnpathies as due to the fact
that the Central Empires are export
ing nothing, and so creating no new
credits. abroad. Others are of the
opinion that the growing weakness
has resulted from the fact that Ger
many's new debts are all internal, and
that the country is practically on a
paper basis, giving rise to imitation,
Bankers acting for the German Gov
eminent have lowered the prices of
German and Austrian bonds to take
account of the new level of exchange
by proportionate amounts. The inn
perial German per cent bonds are
offered at 1872 for 1000 marks, dis
count of about rs per cent, compared
with the price in Germany. The Ger
man As are offered at 500 for 1900
marks. Prior to the war the latter
sold at par, equivalent to about $o4O.
The proceeds from bond sold are re-
mitted to Berlin by wireless, and the
purchasers expect to get their profit
by holding the bonds until peace
brings restoration in exchange rates
to normal.
Anglo French Bonds.
No particular significance attaches
to the decline below the issue price OF
the Anglo-French bonds. according to
an important member of the syndicate
which marketed this big issue. Under
the circumstances prevailing, it is as
serted, the decline is not at all SUR
prising. Many subscriptions were
made by bankers and other business
men upon the understanding that the
situation between New York
and London must be supported in or
der that our foreign trade might 90
on and that the revival of industry In
this country might not be checked
This end having been accomplished,
some of these subscribers having other
and more attractive uses for their fund
have chosen to realize on their hold
ngs even at small sacrifice. A good
natural market has developed, but 1t
nay be that buying has been to some
extent restricted by current talk that
other loans would be offered, and pos
'ibly upon better terms. The latter
'upposition is improbable, although