The Bridgeport times and evening farmer., 1918-02-25
of Finance

~~NOASS1 N~Sb ASL AhoLcIIlCCs LIlc
of the campaign which winter so sud
denly suspended in Italy. If the drive
is undertaken on the Western front,
the loss of life will be appalling on
both sides. Especially must it be so
on the part of the agressors in view
of the ample preparations which have
been made to meet it. Should the
drive not succeed-and the Allie I
commanders are confident that it will
not-then internal affairs in Germany
will most probably force the German
military party to accede with much
freedom than under existing condi-
lions to the peace terms set down so
definitely by the Allies.
This brief review of existing mill
tary and political conditions is, be-
lieve, justified at this time by the ad-
mitted fact that the prospects of
peace are so completely the dominant
influence in the market for securities
as whole. Today nearly all our ma
tional activities are under national
restraint and will remain so until
peace shall have been declared. When
that fortunate moment is to arrive
there is little definite basis for esti-
mating. But one thing does stand
out-that the military and diplomatic
developments of the next few weeks
will operate most conclusively in an
sWering this most important question.
So long as the war continues Just so
long will our government require the
full service of the savings of our peo-
pie. To attract these savings the
Treasury will most probably be called
upon to improve the attra ctiveness of
it's bonds. 1t goes without saying that
in proportion as our Treasury's obli-
cations are made attractive, not I'M
naturally will there be Withdrawals of
capital from five channels that are
less attractive either by reason of the
popular appreciation of the predom-
inant soundness and safety of the fl
nancial obligations of the richest
country in the world, such as our own
government concededly is, Until the
war ends private enterprise must
stand in allegiance. Our entire ex-
port and import trade has been placed
under official control; our shipping,
our railroads, our foreign exchanges.
our domestic trade, such as the distri-
button Of LIES necessities, all are I'M
der license. Every effort is being
made to prevent excess profits, and
where these efforts are not entirely
successful, such profits are in effect
made to accrue to the government in
the form of special taxation. War
taxes of various kinds cut down the
buying power of incomes. Industrial
activity is being retarded by the con-
gestion Of transportation facilities,
Building has fallen to low ebb. In a
word. war conditions are in complete
control Today there seems slight
prospect of relaxation until the ter
Ininatfon of the war comes with more
or less definiteness into sight. Then
in the form of active purchases of Sc
curities the financial markets will an
ticipate peace. They will not await
the formal signatures to the treaties.
Financial circles are thus today
awaiting something definite and tan
gible in the form of peace prospects.
Our railroads may be regarded in
some degree an exception to these
conditions. Their requirement for at
least the full war period by the gov
ernment partakes somewhat of the
nature of insurance under current
trying conditions of their dividends
and IN fact of their financial pros
poets. The President proposes to
guarantee net earnings on the basis
or the three years Immediately pre-
lceding our entrance into the conflict
Dividends are assured; no question of
default of interest is involved. New
capital is to be provided under the
IPnv6rnTSNo1fsu
lent plan of legislation CONCENTRATES
the return of the roads to their own
ers within eighteen months after the
declaration of peace, at which time
the transportation companies will
have successfully weathered the
storm. Presumably they will then be
in an even better condition physically
and financially than when the govern
ment took possession. 1t also becomes
apparent that if the railroads are to
receive funds for providing new roll
ing stock, rails and equipment gener-
ally, the equipment companies will
correspondingly participate in their
good fortune
The money situation has shown q
hardening tendency which is not sur
prising in view of the welI-knowr
conditions which exist. The BANKING
institutions and investors are betne
called upon to take Treasury certiff.
Gates of Indebtedness, $50o,O0O,0oO OF
which are to be issued each fortnight
until a total of $4,000, 100000 has
been subscribed. These certificates
are in anticipation of the third Lib
erty Loan, which is expected to be is.
sued in April