The Bridgeport times and evening farmer., 1919-01-20
HENRY CLEWS'
 WEEKLY LETTER

1TedSVTy SeTLlI1Chtebr COnuItlolS dA fecting Notation of government issues have 30 radically changed that meth ods different from those of previous loans will have to be adopted. The war spirit, a very important factor in other loan drives, has sabstded, and former appeals to patriotism by means of hurricane methods would not noW1 be effectual, especially in view of the decline in all Liberty issues, except the 1-2s. The next loan must depe1N more upon a high sense of public spirit, upon intelligent self-interests and upon meeting financial condi- tions upon a businesslike basis. It has been inferred from the remarks of Secretary Glass who seems to have a sound grasp of the situation, that the coming loan will have to pay 1-2 to per cent. to secure the necessary funds. Money, like other articles and services, will uHavotdably command what it is worth or go elsewhere. Capital is scarce and dear, hence the fall in price of nearly all our govern ment issues. With conditions as they are, a short-term Treasury note, say about three years, bearing from 4 1-2 to 5 per cent. would undoubtedly readily take large blocks, and such an offer would undoubtedly bring out an immense investment demand. There is no doubt that such a loan could be easily financed and the country could secure the necessary funds more easily, and with less dis turbance and cost than by the bois- terous and expensive methods so nec- essary during the war.
 In this connection there is another matter which requires serious atten- ton, and that is the extravagant na- tional expenditures. No complaints in this direction were heard during the war, but now that peace is re- stored there should be vigorous re- trenchment in all departments at Washington. Many unnecessary gov ernnent activities are still main tained; many unnecessary bureaus are endeavoring to make themselves permanent; many constructive works that should be stopped are still going, while hundreds of millions, if not bil- lions, could be saved during the cur rent year if there was only sufficient effort in that direction The govern ment has done much toward such economy, but not enough, mainly be- cause public opinion has not yet been sufficiently aroused to make itself felt.
 | The conflicting outlook of business induces a general conservative tenn per Defation is the prevailing ten- dency; for commodity prices are too high to permit further expansion, and the widespread conviction that prices must recede naturally checks buying. 1 In consequence, the present volume of business is probably below actual requirements, though w1en values be- come more settled on lower basis there is no doubt of renewed activity. The decline seems to be resisted by the stubborn facts that many raw ma i terials are scarce, that the output of mines and mills Is often curtailed be- cause peace orders have not yet filled the place of war orders, and wage ad- justments are impossible before a re- ductton in the cost of living. Some very significant reductions have oc- cured in the textile markets. both
 cottons and woolens being weak. Sev- eral of the most staple brands of cot ton goods were reduced 25 to 20 pe1 cent. this week, the deepest cut on record. That such sensational reduc- tions should be made by the most conservative business houses in the trade meant thlt in their judgment drastic action was the surest way of
 getting back to normal. In these cases war profits were entirely eli1n- mated, and prices cut clean to the
 bone. If further cuts are necessary
 they cannot be had without cheaper
 cotton, lower wages or 8 shutdown
 Which of these alternatives will be
 necessary Is beyond the knowledge of
 even experts. That commodities are
 experiencing worldwide reaction i.
 shown by the London 'TEcon omist'
 index number, which stood at 6094 at
 the end of December, a drop of 11s
 points in the month and the loves
 figure since May, 1918. Textiles and
 minerals showed the heaviest declines
 while articles of food were either un
 changed or slightly higher.
 A decidedly conservative tone pre-
 vails in the financial district. Secur
 ity values are not high because there
 was no imitation in this department
 even the war industrials refusing tt
 such stimulus with few notable ex
 captions. Railroad shares have con. sp1cuously refused to syrnptthize witf
 the advances in commodities Bond.
 have necessarily declined owing to tn,
 advancing rates of interest, while
 public utilities fell to an unusually
 low level, owing to the unpleasan
 fact that the various commissions un,
 der whose control they operate re. fused to allow them to advance rates
 to compensate for increased expenses
 The starvation policy set by the In.
 terstate Commerce Commission seems to have been religiously followed by
 State and municipal control bodie. with much the same effects, that O. , The Interstate Commerce Commission The Interstate Commere Commission having seen the error Of it's ways; vii l the State and municipal bodies dc likewise?
 The railroad situation is much con.
 fused, and interest centers chief , upon the question Of government, ol l private ownership. At the momen- inc trend of rlIrtifc ryripio1 is Iaroo1,