The Bridgeport evening farmer., 1917-01-01

f&eal
pensate themselves for increased ex
penses by raising the charge for theil
services, as has been done in ever.
other industry. Full justice will no
have been done to the railroads un
til they have been relieved of hostile
regulation by individual States, or un
til they are allowed to recoup them
selves, when necessary. for inevitable
increased expenses by better rates; il
other words, until regulation be
comes intelligent and just. The ques
ton of government ownership crops
up with increasing frequency, but thi;
country is not yet prepared or able
to seriously consider such tremen-
dous expansion of government activ-
tiles. Our railroad development is
far from complete, and private en-
terprise, if granted reasonable oppor-
tunity. will provide the necessary new
facilities far more promptly thar
government, which could not afford
to assume the risk. Government own
ership may work in smaller countries
where transportation facilities are
practically completed and where po-
litical conditions are more favorable
than in the United States The
growth and development of Australia
has been distinctly retarded by her
government-owned system of rail
roads, which for lack of private en-
terprise has always been behind re-
quirements. Building of new lines is
essentially a speculative operation and
belongs to private risk Government
owned railroads in Europe, where So
cial, political and geographical con-
ditions are SO different from the
United States, are no criterion for U.S.
particularly as none of them APP
proach American roads in efficiency
low rates or comfort.
Perplexing Business Situation.
War imitation has carried prices of
commodities to unprecedented levels.
It is somewhat hazardous to assume
that this imitation has reached it's
limit. Still higher prices may be
reached, and If so the adjustment fol-
lowing later on will be all the more
severe. Suffice it to say that for the
average business man the future is
full Of extraordinary perplexities for
which there is. no parallel and through
which no sure trail can be easily
blazed. Caution and conservatism
must be the guiding policy in all in
dnstrial and financial activities for
the next two years. This does not
mean an early ending of present pros
perity;; on the contrary, home condi-
tons are so satisfactory in many re-
spects that under skilful guidance such
prosperity may continue Indefinitely
with slight interruption. One source
of confidence is the banking situation
in the United States, which is excep-
tionally sound. Comptroller Williams
tells us that the growth of national
bank resources last two years was
three times greater than any other
two year period. and that the gain in
resources was $4,000. 600 900. There was
no monetary imitation and no danger
Gus expansion Of credit. Our Federal
reserve system is working very sat
isfactorily and possesses banking
power which will prove highly advan-
tageous in event Of crisis. The pol
icy Of the Reserve Board in seeking to
influence other banks will also prove
beneficial, if wisely exercised; and the
Encouragement recently given to
American investment in British treas
ury notes, though rather awkwardly
done, struck a prudent and necessary
note of caution. The action of the
Federal Reserve Board also in maR-
ing connections with the Bank of
England is another step of great sig
nificance and Importance 1t is tan
gible proof that the United States has
gained a new position as a world
financial power, and that while Lon
don may recover its former prestige.
New York has advanced in rank as a
banking power more than any other
city in the word as a result of the
war. 1t will also greatly facilitate
business between New York and Lon
don: render less necessary the clumsy
expedient of shipping gold and tend
to make New York the central re-
serve institution of the country, free
or the political objections to a central
bank. This country now has an enor-
nous stock of gold on hand, estimated
at $4,000. 000,0 and it will be easier
to protect this supply If necessary
when foreign trade resumes it's nor
NAL flow; that it when imports rise
and exports fall to more natural pro-
portions. Further it will tend to re-
move the irritation provoked in Lon
oon oy our refusal to take more Brit
ISM treasury notes. In all proba blity
similar relations will be esta blished
with the other great banks of Europe
Financial Conditions,
The financial outlool for 1917 :;
encouraging. notwithstanding innum-
cradle perplexities arising from the
war. AS peace draws near extensive
readjustmknts will become necessary.
which may induce temporary incon-
venience and loss. 1t can be taken
for granted that the war industrials
Will not revel in the big profits Of the
past year or so; increased cost in
wages and raw materials preventing
any such returns as fostered the wild
speculation Of 1916. Operations for
the rise in commodities will also be-
come more and more hazardous as
peace draws nigh, for as usual high
prices will lessen consumption and
stimulate production not to speak of
the temptation to discount the an
proach of peace. 1t is in these di
rections where future uncertainties
will be greatest. If we differentiate
the situation and venture into fields
least affected by the war, the pros
poets will be found more assuring.
This is conspicuously true in home
affairs, where there are yet no con-
spicuous indications of the present
wave of prosperity receding. Our