Lexington dispatch-news. [volume] (Lexington, S.C.) 1917-1919, 1919-09-10
WORKING And SAVING
WILL REDUCE PRICES
Governor Of Federal Reserve Board
Tells How Living Expenses May Be
:; Cut Down.-Why Everything Went
Up. e.

What is the best way to reduce the
high cost Of living?
Work and save" is the answer CIV
en- by the Federal Reserve Board in
letter written by its governor, w. Z,
G. Harding, to the Banking Commit
tee OF the United States senate. The
committee had under consideraticn the
proposal to reduce the yo!ums OF
moi ey ia circulation. Governor Hard
ing opposes this plan. holding that It
will not afford the relief expected.
The Federal Reserve Board De-
lie es" says Governor Harding in his
letter, that any currency legislation
/; It this time is unnecessary and unde-
srirable, and would suggest that wheth-
sr viewed from an economic or anan-
ciai standpoint, the remedy foY the
present situation is the same. namely,
60 work and 70 save; 70 work regular"
sy and efficiently IN order to produce
and distribute the largest possible
volume Of commodities, and to exer'
else reasonable economies IN order
! that money, goods and services may
be devoted primarily to the l1Qulda'
fton Of debt and to the satisfaction to
the demand for necessities, rather
! than to indulgence in extravagances
or the qualification Of the desire for
Injuries"
: During the last two years there has
undoubtedly taken place certain
; amount of credit expansion, Governor
Harding shows, and this in the cir
cumstances connected with the flnanc-
ing of the war was inevitable. But it
will be corrected as the securities
issued by the government for war
purposes are gradually absorbed by in
vestors. This expansion Of credit is
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 its bonds
and other obligations so far as they
were paid for out Of the savings OF
the people. He does not believe that
any reliable estimate Of this differ
ence can be made, but he is positive
that, whatever it is, 1t 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 i'm
mediate delivery in large volume, and
the competition Of this buying by
governments with purchases by pri'
/ Yate 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
pariod, through which the nation is
now passing and which has been
marked NV rising prices, is the gen
sral relaxation Of wartime practice o!
pszsonA economy. This has resulted
| IA IN increased demand for food end
clothing and other commodities by
many persons who during the wal
| practiced q more or less rigid econ
o,ay in their personal purchases. Also
It must be borne in mind that they
arc not only buying at market prices
bnt are buying in competition with
the export demand. IN addition, large
! " increased wages and incomes dur
| Ing the last i've years have developed
a demand for many commodities which
arc not Of real necessity. This nat
uraIly has diverted labor and raw ane
manufactured materials from essen
t,als to non-essentials, contributing ne
small part to the trend OF increasing
costs.