The Bridgeport evening farmer., 1917-11-06
d of Finance
HENRY CLEWS
 WEEKLY LETTER


 with the war Successful placing of the second Liberty Loan is a source of much qualification. having proved the strength and the abilities of New York as a financial center in a most remarkable fashfon. This must be attributed to the loyal cooperation of the banking fraternity throughout the whole country. Thanks to the oper- attons of the Federal Reserve law and the concentration of banking re- sources, the huge strain has been met with scarcely a. ripple in the money market. Business transactions with the banks have gone along much about as usual, owing to the sktlful conduct of affairs by the Money Com mittee; only 00,0O0.000 of the $200,- 1000 allotted having been used for taking care of business interests. The outlook for the money market is sat isfactory. Crop requirements and au- tumnal demands have been met with out difficulty and time money is available to all good borrowers at req sonable rates. One>effect of the huge bond issue is seen in the new secur- ity issues, which in October were barely $50,00O,000, or about half the | amount of year ago. Since January 1 domestic capital issues have been reported to the amount of 1,400,- 000,0 a decrease of s425, 5,000,000 compared with the same ten months last year. Of course, there were other restraining influences upon new enterprise such as the uncertainty of profits, increasing taxes, advancing wages, new trade regulations, trans portation difficulties, etc., all of which can be traced to the war. Whether money will flow more freely into new enterprises during the next few months, remains to be seen. The country's savings, however, are being largely absorbed by the Liberty Loan and other additional loans will follow { in due course of time; so that imme- diate conditions are not conducive to new f1otations.
 1 The unfortunate plight of Ameri- can railroads is being daily forced up- on public attention and will require some sort of immediate relief Under the strain of war traffic, equipment is rapidly running down, while the impairment of. railroad credit by in- action of the Interstate Commerce Commission prevents necessary re- plenishment. If the roads are to meet the requirements of ordinary traffic and the extraordinary emergencies of war, relief is imperative. Within a few days the Interstate Commerce ICommfssion is to give another hear ing, and there is hope that just and reasonable advances will be allowed to offset present high costs of opera tion- If the relief is adequate, the roads may recover the injury to their credit from the starvation treatment imposed by the Commission Net earnings of several of our most sub stantial roads are, in spite of strict economy, falling to a point that l threatens reductions of dividends. The effect of these conditions is to still further damage their credit, rem | dering it impossible to attract the new capital needed for extensions and inn provements. Vast sums have been ex- pended to meet the increases in wages, while relatively small amounts are also necessary to maintain divi- dends and support railroad credit Government regulation has thus far proved miserable failure, chiefly be- cause the rate-malzing power has been in the hands of prejudiceld and the government to take is to give the railroads a fair chance, which is now denied, them. The present operation of the, transportation companies as a unit is producing marveIlously good results. both for the public and the roads; and there Is no need to con- slider government ownership, provid- ed the government pursues an intelli- gent and fair-minded policy. Our 1 railroads can easily be operated as a unit; preferably under some sort of Federal control, instead of the present confusing and destructive multiplicity of State regulations. American roads are valued at something about $20,- I00o.000,o00; and their taking over by the government is a transaction alto gether too huge to receive serious consideration in times like the pres- ent.
 The irregularities in the stock mar ket were only such as must be ex- pected in these troublous times. Se- lvere declines occurred in many of the leading issues, which in addition to l the uncertainties referred to above were aggravated by the disturbance in Canada, arising from temporary interruption of gold shipments and heavy selling attributed to German sources. The setback in Italy also depressed the market on the theory that it will prolong the war. Trade and industry are still more or less conIused by the expansion of govern ment control, which has already reached vast extent. The govern ment- is rapidly applying its price fix ing policy, which meets with general public approval. Even merchants and manufacturers are in favor of the present policy of stabilizing prices and | stopping profiteering. The govern ment is also succeeding in it's efforts to regulate the distribution of food products and certain other staple in- dustrfes, while the food conservation Icampaign is bringing important econ omies. Needless to say, business men are facing and solving many highly perplexing questions, though not without considerable anxiety. Never theless. the volume of trade, generally speaking, continues exceedingly active The tremendous demands created by the war and which will continue with the vast expenditures of the Liberty Loan, prevent any decline in the grand total of industry. A few of the less necessary lines of work are Ifeeling the diversion, but the coun- try as whole is still enjoying pros perity, with occasional depression in spots. It should be remembered that not all of the vast amounts now ex-