Daily capital journal. (Salem, Oregon) 1903-1919, 1918-03-01
FinanGier Says BOIsheviki
Does Not Represent Russia

! clude peace based upon $4,OO0,oo0,-
600 indemnity and the cession of such
such large amount of valuable terri
tory as now demanded by Berlin does
not possess the Importance as market
influence that specifically one might
feel impelled to attach to it. 1t exposes
the falsity of the specious German talk
of desire for ''just peace without in
demnity and without annexation and
leaves no other course for our own gov
ernment and our associates in the war
than to pursue the war aims that have
been so frankly set forth by our own
president, by David Lloyd George, the
British premier, and the French For
eign Minister, M. Clemenceau, namely
the safeguarding of democracy by re-
moving the German military menace.
Here we have the cure for the real dis
ease; the Bolsheviki developments are
merely disagreeable symptoms.
To attract these savings the treasury
will most probably be called upon to
improve the attractiveness of its bonds.
1t goes without saying that in proper
tion as our treasury's obligations are
made attractive, not unnaturally will
there be Withdrawals of capital from
fixed channels that are less attractive
either by reason of their smaller return
on the investment, or by reason OF the
popular appreciation of the predomin-
ant soundness and safety of the finan-
cial obligations of the richest country in
the world, such as our own government
coneededly is. Until the war ends pri-
vate enterprise must stand in abeyance.
Our entire export and import trade has
been placed under official control; our
shipping, our railroads, our foreign ex-
changes, our domestic trade, such as
the distribution of life's necessities, all
are under license. Every effort is being
made to prevent excess profits, and
where these efforts are not entirely sue
cssful, such profits are in effect made
to accrue to the government III the form
of special taxation. War taxes of var
ious kinds cut down the buying power
of incomes Industrial activity is being
retarded by the congestion of transpor-
tation facilities. Building has fallen to
low ebb. In word, war conditions are
in complete control. Today there seems
slight prospect of relaxation until the
termination of the war comes with
more or less definiteness into sight.
Then in the form of active purchases OF
securities the financial markets Will an
ticipate peace. They will not await the
formal signatures to the treaties Fin
ancial circles are thus today awaiting
something definite and tangible in the
form of peace prospects.
Our railroads may be regarded in
some degree an exception to these con-
nuT for at least
the full war period by the government
partakes somewhat of the nature OF
| insurance under current trying condl-
tions of their dividends and in fact of
their financial prospects. The president
proposes to guarantee net earnings on
| the basis of the three years immediate
| " preceding our entrance into the con-
| flict. Dividends are assured; no ques-
! ton of default of interest is involved
New capital is to be provided under the
Government S auspices; and the present
IDlan of legislation contemplates the re-
/ turn of the roads to their owners with
! in eighteen months after the declaration
of Deace, at which time the transporta-
/ tion companies will have successfully
yeathered the storm. Presumably they
win then be in an even better condi-
ton physically and financially than
when the government took possession. 1t
also becomes apparent that if the rail
roads are to receive funds for providing
new rolling stock, rails and equipment
generally, the equipment companies will
correspondingly participate in their
good fortune.
The money situation has shown a har-
den,ag tendency which is not surprising
in view of the well-known conditions
which exist. The banking institutions
and investors are being called upon to
take treasury certificates of indebted
ness, $500, 100000 of which are to be
issued each fortnight until total of
I $4,000, 100000 has been subscribed.
These certificates are in anticipation
of the third Liberty loan, which is ex-
pected to be issued in April.
HENRY CLEWS.