New Britain herald., 1917-07-14
Henry Cleus
 Weekly Letter
Especial to the Herald).


 look is. comparatively clear. Funds withdrawn by preparations for financing this transaction and the July disbursements are returning to this center and the situation was further relieved by reduction of re- serves of Federal Reserve Banks from Is to 13 per cent. basis, a move which at once released about 90,0OO,0OO. With these transactions out of the way, the course of the money market is now fairly clear for the present. Payments for the original loan will not be completed until the close of August, and the Allies will soon be in need of additional funds; so that with our own military demands also to be met, the absorption of funds will be on heavy scale as long as the war continueS There is no ques- tion but that these requirements will be easily satisfied. but the universal waste and need of capital created by the war many stiffen the demand, as well as the rates, for its use. The sale of $55,OO0,00O New York City 4 F per cent. bonds was as success full as could be expected under exist ing conditions. The price seemed low compared with previous sales, and was significant chiefly as prov ing the higher rates necessary to com mand capital.
 Developments in the war are en- couraging in the direction of peace. Upon the whole the Allies are making steady gains; not so much in terri tory as in the persistent wearing down of the military strength of the Gen. tral Powers, while the Allies strength Is steadily maintained and even gaining. Success in this war is not to be measured so much by territory won or havoc wrought, as by the relative fighting abilities of the two which side is in the ascendency and which on the decline. Signs of dis sension and even disruption are evi- dent in Germany's present govern ment crisis but these should not be taken too seriously. Although Ger many is tired of the war and dis satisfied with it's recent conduct the kaiser's power Is by no mean broken. It should be remem bered that both Great Britain and France have had several government crises, and Rus sia great revolution; but none of these events had any other result than a determination to carry on the war with still greater vigor It is premature, also. to suppose that the present crisis in Germany means an early end of the war. Germany is not yet conquered; and there is no assurance that her people are yet ready for the sort of peace terms that the Allies are bent on dictating.
 The stock market feels the heavy pressure of Government regulation which is extending more and more in to all departments of industry. Our i1rr Ic Ioy fol tions upon earning capacity, and made l it difficult to secure capital for nec- essary terminals, extensions equip l ment, etc. President Wilson's re- marks on Thursday regarding price fixing caused something of a disap- | potntment to the stock market. In my | opinion, however, his words will ulti- 1 mately do good, for the President fla vorS fair profits, even liberal profits | when justified and the policy which 1 he has initiated will tend to prevent 1 excessive profits and stabilize them; i thus moderating extremes and pre- 1 venting undue reaction. In the in l dustral world high degree of uncer- | tainty has been injected by too many 1 new legislative schemes introduced in | to Congress. Some Of these measures i may be wise and necessary purely as | war meaSuTSS, put lHeN dIS nSNoIlHe- less disconcerting and unsettling for | the time being. The liquor industry 1 has been seriously upset by the pro- hibition features, thrust as a rider up- on the Food Control bill. The last l named measure will affect very wide | range of industries, from the farmer l to the retailer Enactment of legis- l lation for control of export trade, also 1 an act regulating trading with the en- emy are laws likely to lead to goOd l deal of uncertainty. Almost every de partment of business is more or less unsettled by these new conditions. That prices of many articles are ex- cessive is granted. Imitation and high prices are inevitable economic conse- ouences of war. Every effort should be taken to prevent greed taking un- due advantage of the situation; but, however, idealistic and patriotic we may feel and however we may repel at high prices. the solid fact cannot be ignored that nothing cures the scar city which causes high prices quicker than high prices themselves.
 To force prices of copper or steel down to a point that might be fair profit to the low cost producers would simply result in wholesale shutdowns 1 of producers less favorably circum- stanced; thus aggravating bad sltua- tion by further shortening of sup | plies. President Wilson's criticisms of the shipping industry were doubt less Justified and will probably do l good: yet were it not for the high 1 prices which ships command and the | profits they can earn. there would 1 have been no such herculean efforts l 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 | shine as o,,iclyly as possible; and the |