The Caldwell tribune. [volume] (Caldwell, Idaho Territory [Idaho]) 1883-1928, 1916-01-07

New York, JAM, 1916.
The year 1915 may be regarded as
one of the most remarkable years in
the history of the world. In financial
chronology it will be remembered
chiefly as having put into successful
operation the MANY wise plans tor
commercial rehabilitation conceived
by our bankers and business leaders
during the preceding year. During
the closing weeks Of 1914 various
features of the mechanical mechanism.
previously suspended by the effects
of the great world war, were again
restored to working condition. most
notably the New York Stock Elk
change.
The history of 1915 can most brief
Nv be written in two words: liquida-
ton and expansion: liquidation of
American security holdings by the in
habitants Of the terror-stricken coun-
tries of Europe; expansion OF the
American commercial policy so that
American capital has combined with
American enterprise for the greater
development Of the trade possibilities
with foreign countries. Not only so,
but through this policy the dormant
and hidden natural wealth of for
eign lands will be uncovered and
made to yield tribute to American
capitalists and investors. The great
republics of the South American Con-
tinent will be drawn into closer rela-
tionships with the United States. and
the commodities which heretofore
were produced in the factories of En-
rope will give employment to work
men who make America their home.
This is the great objective which
1915 has fairly inaugurated and which
each succeeding year will doubtless
establish on a firmer and more per-
manent foundation. This is the key
note of the expert opinion of Ameri
can financial leaders, as expressed
exclusively for this review and which
are here presented for the benefit of
our readers:
CHARLES S. HAMLIN. Governor
Federal Reserve Board, Washington,
D. c.: The past year has been a
period Of unusua3 and striking devel-
opment in business. At the begin
ming of the year we were still en-
gagged in liquidating our current in
debtedness to Europe by the ship
ment of goods to pay off and meet
the demands of English banks and
bankers. This was followed by four
months of record export shipments
during which the claims of the United
States were settled through the re-
turn of American securities held
abroad, During the late summer and
the past autumn we have been sending
goods to Europe on a credit basis
and financing our own exports. The
result of this unprecedented demand
for our goods at high prices has been
to supply the Nation largely with
fluid funds, making interest rates low
and business correspondingly active.
Strictly domestic business has enor-
mously increased and reports of bust
ness conditions made to the Federal
Reserve Board from every part Of
the country show that substantially
all lines are now actively employed in
producing a maximum output and
selling it at reasonable rates. Rail-
road earnings have improved and the
business situation is both sound and
promising. There would seem to be
no reason for doubling the continu-
Jus bSNSiOPHlCnt vi u dung It's
present lines for some time to come.
There appears to be every reason to
look forward to successful business
during the coming months. with
prices strong and rising and with
bank capital abundant at reasonable
rates. 1t must not be forgotten, how
ever, that the whole world is on an
unstable basis and that the continu-
GUS depletion of European stocks of
capital will inevitably reflect its re-
suit upon the United States at the
close of the year,-perhaps even be-
lore that time. Productive capacity
abroad may be quite promptly re-
stored but the restoration of purchas-
ing power will be much slower mat
ter. We can not expect the present
demand for our goods to continue
indefinitely while the DEVELOPMENT of
high level of prices in the United
States will necessarily handicap us to
some extent, no matter what legis-
fation may be adopted for Our protec-
ton. The part of wisdom of Ameri-
can manufacturers and business men
rs, therefore, Enthusiastically that of
caution and prudence in their effort
" prevent inc present sound state OF
prosperity from developing into infla-
ton. Preparedness" for possible
events and the maintenance of suffi-
cient strength to meet any sudden de-
nands growing out of reaction in
business or violent alterations in en-
port trade should be the policy of the
banks of the country. The Federal
Reserve Banks must exercise the
functions of financial leadership 10