Daily capital journal. (Salem, Oregon) 1903-1919, 1917-07-18
Market Situation
Is Clarified For Present


ready for the sort of peace terms that
the allies are bent on debating.
Wilson'S idea Correct
The stock market feels the heavy
pressure of government regulation,
which is extending more and more into
all departments of industry. Our rail-
roads have felt it in heavy restrictions
upon earning capacity, and made it diff
ficult to secure capital for necessary
terminals, extensions, equipment, etc.
President Wilson S remarks on Thurs
day regarding price fixing caused some
thing of a disappointment to the stock
market. In my opinion, however, his
words will ultimately do good, for the
president favors fair profits, even lib
eral profits when Justified. and the pol
icy which he has initiated viii tend to
prevent excessive profits and stabil-
ize them; thus moderating extremes
and preventing undue reaction. In the
industrial world high degree of un-
certainty has been injected by too many
new legislative schemes introduced into
congress. Some of these measures may
be wise and necessary purely as war
measures; but they are nevertheless
disconcerting and unsettling for the
time being. The liquor industry has
been seriously upset by the prohibition
features, thrust as a rider upon the
food control bin. The last named meas
ure will affect very wide range of in
dustries, from the farmer to the retail
er. Enactment of legislation for control
of export trade, also an act regulating
trading with the enemy, are laws like
ly to lead to good deal of uncertainty.
Business disturbed
Almost every department of business is
more or less unsettled by these new con
ditions. That prices Of, many articles
are excessive is granted. Initiation and
high prices are inevitable economic
consequences of war. Every effort
should be taken to prevent greed TAX
ing undue advantage of the situation;
but, however idealistic and patriotic
we may feel, and however we may rebel
at high prices, the solid fact cannot be
ignored that nothing cures the scarcity
which causes high prices quicker than
high prices themselves. To force prices
of copper or steel down 10 a point that
might be fair profit to the low cost
producers would simply result in whole
sale shutdown of producers less favor
ably circumstanced; thus asgravating a
bad situation by further shortening of
supplies. President Wilson'S criticisms
of the shipping industry were doubtless
justified and will probably do good;
vet were it not for the high prices
which ships command and the profits
they can earn, there would have been
no such herculean efforts to build ships
as are now being made. The United
States, Great Britain, Norway, japan
and other nations are bending every
energy to turn out ships as quickly as
possible; and the output will far ex-
ceed any previous efforts throughout
the world Here again high prices are
the quickest cure for arrangement
arising from war or the submarine
One feature of real encouragement
was the last government crop report.
1t suggested crop of 3,l24,000,000
bushels Of corn, which almost equals
the bumper crop of 1912, when the
price was about soc, as against nearly
So now. This enormous increase in the
money value Of corn will be a power
tul stimulus in the west. The wheat
crop has also much improved in condi-
ton, indicating 22,000,000 bushels more
than a month ago. The most sensational
gain was in the potato crop, which
promises 452,000,000 bushels, compared
with 2S5,000,000 last year. All things
the agricultural outlook is
good. No serious shortages are in pros
pect, and high prices amply offset in
creased costs of production.
HENRY CLEWS.