The sun. [volume] (New York [N.Y.]) 1833-1916, 1916-06-19

the conduct Of bankers n business
men. Thu slight rise In call money
rates over a week ago speedily developed
that during the prolonged period Of ex-
IRENE ease in the price for all kinds Of
credit accommodations there had been,
very much in consequence OF the work.
ifgs Of the Federal reserve system. a
wide diffusion OF reserves throughout
the country. The slightest hint of more
remunerative lending rates served at
once to attract offers Of funds to the
country's financial centre from all quar-
tiers Of the land.
Power Of Serious Element.
Yet one Of the most propitious fea-
lures Of the Wall Street chronicle for
many a day has been the inferential
connection between the display Of a
hardening tone In money and the an
nounced abandonment last week Of the
scheme for the ambitious n inflated
merger Of automobile corporations which
was projected only a fortnight or so
ago. However else the cancellation Of
this undertaking was or could be ex-
planned, Wall street chose to consider
II as a token Of the control exercised
by the serious elements Of finance over
enterprises which might interfere with
the process Of meeting the cardinal re-
Quirements Of the securities market.
These are denoted by the steady return
Of our securities from abroad. the steady
recourse Of foreign borrowers to u
money market and the new financial
needs Of domestic corporate organiza-
lions. Bordering on the field OF invest
ment activity thus denoted there Is a
considerable area which permits legiti-
mate speculation in the prospects for
corporate equities. but so far the country
has avoided an excessive speculation In
the i%nordinate capitalization Of future
profits. Whatever shows that Il Is to
be spared such D visitation IL gratifying
and the dropping Of the automobile
merger in question seems to belong in
this category.
On the other hand a distinct step In
the right direction was taken In the
Russian loan announced last week. BY
an ingenious arrangement a credit OF
$50, 900, 900 Is placed here at the dis
posal of the Russian Government Offset
by q similar credit in Petrograd for the
uses Of our nance. The arrangement,
Of course, relates 10 the business be-
tween the two countries originating In
the war, but its essential Importance
consists in its possibilities as a depart
ure In the direction OF bringing Amer
lean capital in contact with the enor-
nous economic DottHbihiit'Ns Va N'' -
future. 1t is the expert consensus that
Russia alone will emerge from the Eu-
ropean war relatively free from any
strain which will be long felt because
of the financial burdens which the war
inevitably imposes.
Russia has a huge national debt, but
its comparative insigniicance may he
gagged by the statement credited to a
German observer some months e That
IL Russia were properly organized po-
litically and economically the land OF
the Car alone would be able to dis
charge the total European debt for the
war In a decade or so after its termina-
ton. The statement may be ap~ocryphal
and It's entire accuracy may be disputed
Moreover. the efficient organization or
Russia for the exploitation OF Russian
resources may he a slow process. hut the
opinion cited adequately represents the
well informed notion held OF Russian
possibilities. There is no country which
would seem to offer attractions superior
10 Russia for the external employment
OF American capital to the advantage OF
Investor and borrower.