The Lancaster news. [volume] (Lancaster, S.C.) 1905-current, 1919-09-02
WORKING AND SAVING
WILL REDUCE PRICES
Gsvsrnor Of Federal Reserve Board
Tei's How Living Expenses May BE
Cut Oo~n.-Why Everything Went
Up.

What is the best way to reduce the
high cost OF living?
Work and save" IL the answer Civ
On by the Federal Reserve Board in q
letter written by its governor, w. p.
@. Harding, to the Banking Commit
tee Of the United States senate. The
committee had under consideration the
proposal to reduce the volume Of
money in circulation. Governor Hard
ing opposes thSs plan, holding that IT
will not AFFORD the relief expected.
The Federal Reserve Board be-
hsyos" says Governor Harding In his
letter. that any currency legislation
At this time 10 unnecessary and unde-
strabls, and would suggest that wheth-
eS viewed from aA economic or nnan.
ctal standpoint, the remedy for tho
present situation - the same, namely.
20 work and to save; 70 work regular
y and efficiently IN order TO produce
and dfstributs the largest possible
volume q commodities, and 10 e1sr.
else reasonable economies in order
that money. goods and services may
be devoted primarily TO the liQuida-
ton OF debt and to the satisfaction to
the demand for necessities, rather
than TO indulgence in extravasances
or the 8rs tihcation Of the desire for
luIuries."
During the last two years there has
undoubtedly taken place a certain
amount Of credit expansion. Governor
Harding shows, and this in the cir
cumstancss connected with the nnanc-
fns cf tho war was inevitable. But II
will be corrected as the securities
Issued BY the government for war
purposes arc gradually absorbed by in.
vsstors. This expansion Of credit 10
equal to the difference, Governor
Harding says. between the total war
expenditures Of the government and
the total amounts raised by the gov
ernment through the medium OF taxa
ton and from the sale OF It's bonds
and other obligations 20 far as they
we're paid for out OF the savings of
the people. He does not believe that
any reliable estimate OF this differ
once can be made. but he is positive
that, whatever II is. II will be grad
ually absorbed through future savings
for the reason that banks are lending
and may always be expected to lend
freely on the government bonds de-
posted as collateral
The principal cause OF price ad-
vantes just before and during the per
iod OF the war was the need OF the
governments OF the allied nations for
all kinds OF commodities and for nm
mediate delivery In large volume, and
the competition OF this buying by
governments with purchases by pri-
vate individuals who failed to contract
their expenditures at rate commen.
surate with the growing expenditures
OF these governments
One OF the features OF the postwar
period. through which the nation Ia
now passing and which has been
marked by rising prices. is the gen
eral relaxation OF wartime practice OF
personal economy. This has resulted
in an increased demand for food end
clothing and other commodities by
many persons who during the war
prac ticed a more or less rigid econ
omy in their personal purchases Also,
II must be borne in mind that they
are not only buying at market prices
but are buying in competition with
the export demand In addition large
ly increased wages and incomes dur.
ing the last nve years have developed
Q demand for many commodities which
are not OF real necessity. This nat
urally has diverted labor and raw and
manufactured materials from essen.
tials to non essentials. contributing no
email part to the trend Of increasing
costs