The Washington times., 1918-12-07

There is nothing to be dreaded ih
the process of postwar "reconstrlc-
ton" if reports gathered in all sec
tions of the country this week and
made public here today by the Fed
eral reserve banking system are
correct.
With the return to civilian life
of hundreds of thousands of soldiers
within the next few weeks, there
possibly maybe required a brief
period for ,stabilizing the labor
market and in consequence there
NAV be a slight lowering of the
present standard of wages. Prices
for food and merchandise, the neces-
saries of life, already are on the to-
boggan, and the corresponding drop
ping in price will be greater than
the lowering in wages.
Swift Response to Truce.
How business conditions in the Uni
ted States have made swift response
to the signing of the armistice is re-
flected in the summary issued today.
Up to the date of the armistice. in
dustrial machinery was being oper-
ated overtime to war requirements
country was being developed to its
highest capacity. Subsequent to the
signing of the arInistice there set in
a period of temporary uncertainty
which lasted less than a week. 1t was
terminated by the beginning Of the
process of "demobilization."
This process has implied, thus far.
Ehe cancellation of Government con-
tracts, the suspension of war work in
a variety of lines, and corresponding
shifting of buying power and modi-
ncations of prices in various direc-
tions. According to reports written
since the signing of the armistice and
relating generally to conditions in the
Eastern States, the effect of indus
trial. displacements already brought
about has been to overcome the eX-
treme scarcity Of labor.
Prior to the signing of the armistice
il was already evident in a number of
directions that continued activity in
the war work would still further
modify our business situation. Foreign
commerce was reported from import
ant shipping points as declining,
while overtime had been abolished in
those Industries which were not work.
ing upon distinctly Government de-
nnands-
On the other hand. it appeared that
prices were probably past their peak,
and that with readjpstment of war
conditions that had already been ar
ranged, as well as with the introduc-
ton OF more effective methods OF
saving in some industries, the drift
of prices was likely to be slightly
lower. Prices had already shown a
slight recession from the level reach
ed about the middle of October,
g--1
apparent willingness of the public to
buy at almost any price that might
modfties on hand were constantly
subject to shortage.
But all this is changed now. the
Federal Reserve Board finds. Busi-
ness is being conducted on a more
normal basis. Wages may possibly
be revised downward, but at the same
time prices will take a correspond
ing slump.
RAMS Must Be Cautious.
The banks OF the country. the true
auEury of the conditions in the United
states. are admitted to be in a po-
aition which calls for careful and far
sighted handling in order that their
resources may not be 600 rapidly
absorbed in connection with purely
6eyeIopment work: while on the other
hand. IT Is admitted that they are
now in a position which calls for very
conservative treatment in order grad
ually TO reduce the loans on war
paper which have been piled up in the
process of placing the several Liberty