The Bridgeport evening farmer., 1917-01-01
World Of Finance
ANNUAL REVIEW OF BANKING
HOUSE OF HENRY CLEWS & CO.

but that the United States will be
able to hold large portion of its
newly gained advantages and prob
ably make still greater progress dur
ing the next decade. OF course, there
will be severe international competi-
ton. Germany and Great Britain
will strenuously endeavor to regain
markets lost during the last two years.
This means that the United States
will have to sell as cheaply as posi-
BILE, even if European goods cannot
be marketed at ante-bellum prices.
For year or two at least this coun-
try will export large quantities of
steel products and other raw ma
terials for reconstruction purposes in
Europe. In all probability the war
will be followed by a period Of world
wide expansion and activity, which
will also afford larger opportunities
for American manufacturers. 1t is
not to be supposed that the ablest
bankers and manufacturers in the
country would be making such ener-
getic efforts for securing foreign
markets unless they had the strongest
reasons for anticipating success. A
moments reflection will disclose that
all our great industrial and financial
leaders are deeply impressed with the
opportunities for export trade, and
the next decade promises to see great
progress on part of the United States
in the foreign field. Success is in
evitable, provided capital secures the
hearty cooperation of government
and labor, both of which hitherto
have been so unfriendly Foreign
trade, as I have remarked before, is
purely matter of internat ional bar
ter and if we wish to sell we must
stand ready to buy; remembering
that all impediments placed upon
such interchange cause loss some
where, and usually UPON those who
inf1ict them. AMERICAN industry
passed the infa ntile Stage some years
ago and is now in a stage of vigorous
youthfulness, quite ready and eager
to meet the older nations of Europe
on equal terms.
A Better Railroad Outlook
Very significant changes have TAX
en- place in the railroad outlook dur
ing the last twelve months. Corpora
ton batting is no longer as politically
profitable as it formerly was, a state
ment that applies to railroads quite as
freely as to big industrial concerns
and trusts. Railroads, however. suf-
fered more severely than any other
class Of business orga nizations. prob
ably because of their intimate rela-
tons with the public at large. Be-
tween the upper milestone of oppres-
sive Federal and State legislation and
the lower milestone of labor demands
and increased expenses, American
railroads only resca ped serious finan-
cial difficulties, If not bankruptcy,
through the~timely revival of business
which brought them general prosper
ity and averted an imminent crisis.
Last year. their total income was 3d.
900, 100000 and net $1,09S, 100000, an
altogether unprecedented total. The
present ratio of increase in net is
large, but in. view of large increases
in expenses will not be long main
tanned. For years the demands up
on American railroads by labor and
a hostile public have steadily increas-
ed while unfortunately State and Fed
eral commissions imposed restraints
and burdens which impaired their
profits until resources and credit
were SO crippled as to make it impos-
sible for the transportation lines to
secure the capital required to provide
new mileage or improvements. In
1909 the railroad capital applications
were estimated at a little over $780,
600, 900 stocks and 100000, 900 bonds
In 1915 such applications had sunk
to s22,000,000 stocks. but risen to
1851, 100000 bonds. This tendency
toward shrinkage in stock issues and
expansion in bond and note issues
has been going on for a series of
years, rejecting the distrust of inves-
tors in this class of securities arising
almost entirely from the political
conditions just referred to. In the
eleven months of 1915, stock issues
have been $1O9, 100000 bonds s34S,-
100000 and notes $30O,OO0,OO0, indi-
eating a partial revival of interest Of
investors in railroad shares. There
has been little new addition to mile
age or facilities for several years, and
the problem of securing adequate
new capital is the most formidable
problem at present confronting rail-
road managers. Increased facilities
are needed. The government certain
ly cannot provide them and private
ment forces increased expenses and
diminished revenue at the same time
Present traffic is abnormally good,
but when normal conditions return
the situation will again become crit
1cal unless relief is meanwhile af-
forded. Fortunately, there has late
ly been change for the better in
public opinion toward the railroads
and the latter now have much bet
ter prospect Of securing just treat
ment than at any time during the past
decade. Nothing occurred more eff
fective in bringing about this change
of opinion than the unreasonable de-
mands of railroad employees, follow
ed by the threat to tie up the rail-
roads of the country if not complied
with. This hOld-up awakened the
public to the seriousness of the situa-
ton, and the latent spirit of fair play
which fortunately exists in the Amer
lean public came to the rescue. It is
premature, however, to assume that
the roads will henceforth have clear
sailing. The action of the brother
hoods in insisting upon operation Of
the Adamson law before announce
ment Of the decisicn of the Supreme
Court created an unfavorable impress
sion, inasmuch as it reopens the
breach between railroads and labor.
The roads are also still gravely en-
barrassed by dual State and Federal
regulations, by frequent municipal
requirements, by high wages and
dearer materials, which when traffic
settles down to normal volume may