New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1917-03-17
Current Comment

II is appropriate at this time to point
out how the economic development OF
the United States after the war will be
affected by the present absorption Of
war bonds.
II there had been no war the estab-
lishment of the Federal Reserve sys-
TEN overnight would have made hun
dreds of millions Of capital available
for economic development. The sup
ply of capital thus suddenly increasing
relative to tire supply of commodities
and labor, there would have been ris-
ing prices and increased wages, attend
ed by growing imports Of merchandise
and increased immigration. There
would have been large issues of Sc
curitics by corporations engaged in de-
welcoming the resources of the country,
which our investors would have pur-
chased.
As it is. we have large security is
sues, but more for the purpose OF in
creasing the production OF war sup
plies than for internal development
We have high wages, but immigration
is cut off. The increased resources Of
the banks are being utilized, but the
direction of new investments Is notably
otherwise than would have been the
case il the war had not occurred. Our
bankers and investors are learning to
deal in foreign securities of all kinds,
and this experience will in the future
turn American capital more largely to
foreign enterprises than if the war had
not occurred.
The establishment Of the Federal Re-
serve system has been attended by I'M
precedented participation in foreign
commerce, while the internal develop
ment of the country has been delayed.
For years to come many American in
vestors will receive an income from
Europe instead OF from securities
which would have been based upon do
nestle progress had peace continued
Alexander Hamilton Institute.
The cotton advance has stimulated
further buying of cloth, especially for
manufacturing and converting pur-
poses. Some jobbers and catalogue
houses bought literally of spot goods
in February TO meet urgent needs, yet
IT is true that goods have accumulated
at finishing works awaiting orders for
processing or shipment 10 customers,
and il is conceded by merchants that
there has been some curtailment Of
consumption due TO high prices FOR
food. and hesitation on the part Of re-
tailers TO ask the higher cloth prices
warranted by producing conditions.
Costs of production have increased
abnormally, because of the rise IN coal
and other supplies, notably dyestufs
suitable for cotton goods, and there has
been considerable delay in distribution
both for home and foreign use in con-
sequence OF transportation difficulties.
Merchants are less convinced Of the
probable maintenance OF full demand
for all products under armed neutrality
conditions than manufacturers appear
to be. yet all admit the probability OF
more or less interrupted supply dur
ing the summer, growing out OF labor
conditions. The rigid control Of specu-
linton in cotton goods continues and Is
being exercised by merchandise man
ayers of large stores as we'll as By mer-
camille bankers.-The first National
Bunk Of Boston
From the standpoint OF organization.
American cities have made as much
progress during the last sixteen years
as during the entire nineteenth CEN
tury. This increased efficiency justifies
and assures greater degree Of homo
rule for cities. and it is almost certain
than the near future will see m er-
pansion OF municipal activities com
parable to those of the European cities.
F 4. Magruder. Department Of Politics,
Princeton Unwenity.