The Bridgeport times and evening farmer., 1918-04-29
The World of Finance

md peTplexities to be faced Gov srnment regulation is still the great 1nSetthng factor, and there is every reason to expect still furtfor intru- i SionS of this character. Tie difficult | problem of price fixing is one that 1 closely occupies the attention of pub ! lie officials Legislators seem unable to cope with it satisfactorily, and none appreciate the limitations of a price fixing polity better than our eff dc1ent and exceedingly capable Food Administrator, MT. Hoover. The vari- ous metal trades, particularly steel and copper, have been unsettled for some time past pending government action Discussion as to fixing prices of wheat at $2.5O is still going on, though MT. Wilson is understood to oppose any increase in the price of wheat beyond the present figure $2.25; and Canada is content at fixing the price at $2.A. Meanwhile the Western farmer fails to see why the price of his wheat should be restrained, when the Southern planter is apparently free to push the price of cotton to the limit of profteering, as has already been done. Our cotton and woolen manufacturers are also more or less in the air, in view of the prospects of government regulating the prices of ftntshe5 goods, and the supplies of wool. Disinterested judges, even gov ernmental officials themselves, recog- nize that prices are best regulated automatically by the law of supply and demand; yet under the cDndi- tions created by war there is appar- ently no other means of preventing the interruptions from profteering and taking undue advantage of the needs of others. If the war continues the government will probably under take to enforce both price fixing and curtailing of luxuries in a much more vigorous fashion than ever. The eff fore to turn industry from proIdnc- tion of non- essentials to essentials will become even more aggressive; and the campaign for public economy must then become more and more in l tense. Though actual legislation in this direction is hardly probable, the government through it's control of transportation, and especially through its banking influence when the War Finance Corporation is in operation, Twill be able to control business forces, directly or indirectly, much more completely than now. Plans are al- ready been made to these ends.
 The local stock market 1uctuates within narrow limits. Prices have shown remarkable resistance to in numerahble uncertainties, partly be- cause values are bow and partly be cause present conditions have been
 amply discounted. Another factor, not to be overlooked, is the rising spirit of courage manifested in all sorts of activities; the psychological
 effect doubtless of war and the i'm perattve necessity of facing struggle.
 In such a state of mind investors do
 not take fright easily and are more
 disposed to regard the future hope fully. The effect of price fixing and taxation is already observable in the
 net returns of some tndustrials, all though the war group continue to
 show very liberal profits. In a few
 instances net earnings and dividends have been reduced by circumstances
 just noted. The majority of indus
 trials, however, are earning suft1-
 ciently large margins to allow a con
 tinuance of present dividends. The Frailroad situation is reasonably sat
 isfactory, and better net results are
 anticipated in consequence of i'm Iproved traffic conditions and the large
 volume of freight that will surely Ipress upon the roads during the next
 six months. Less anxiety is also felt
 concerning the financial necessities ot the roads, as the War Finance Cor Iporation is expected to soon be ir
 operation; and, as shown in the pro-
 posed contract now under discussion
 the administration is known to be irH
 tent on dealing fairly with all phases
 of the railroad situation. There are
 no signs of serious strain in the
 money market owing to the fact that
 requirements for taxes and bond sub
 scriptions have been thoroughly an
 ticipated and skilfully handled. Shoult
 any stringency occur, it is not likely
 to be either severe or prolonged. The future of the security market, 0: 7 course, depends almost entirely upoT the outcome of events on the Wester1 front, and conservatism should be tht rule in all Financial operations.