The sun. [volume] (New York [N.Y.]) 1916-1920, 1919-01-02
REVIEW OF FINANCE AND
BUSINESS IN LAST YEAR
ny WILLIAM JtsTts BOIEs.

position for controlling the markets OF
the world then 1t was necessary for
the people to purchase Liberty bonds.
treasury certificates Of Indebtedness,
War Savings and Thrift Stamps in
increasing amounts
That they did this Is apparent from
the fact that they put IN more than
29,OOO.OO0 subscriptions for the $i,l70,-
Ols,65o bonds issued under the Third
Liberty Loan OF May Q and the ss,s66,-
$4,000 bonds issued under the Fourth
Liberty Loan of October {? Both were
record loans, and since they followed
similar investments by the public OF
So.SOS. '66,l50 in the first and second
Liberty bond issues OF 1917 tho re-
sponse was astonishing. Through its
FOUR war loans issued since May IA.
1917, the United States Government has
succeeded in placing Its bonds with one
out OF every four citizens OF the cont
mental United States. This was re-
markable achievement. and when it II
remembered that the bond market OF
this country prior TO the outbreak OF the
world war comprised scarcely 100000
people--less than one-half OF I per cent.
OF the population-it will he seen that
the fiotation of the four huge bond Is
sues OF the war period have added many
million people to the bond buying public.
As a direct con sequence OF the nation
wide canNasees to lodge these loans with
the people the United States enjoys
&c day the largest and the best organized
bond market in the world. This will be
of great assistance in creating broader
market for the immense issues OF rail-
/, ad and Industrial bonds which will be
offered during the coming twelve months
In connection with the readJustment OF
American industry to a peace basis
The general bond market Will be helped.
too. by the organization OF the selling
forces under the auspices of the Liberty
Loan committees in virtually every city
and town of the country No bond issues
were ever as well distributed as were
the two Government loans OF 1918. B>
offering tho Liberty Loans in deuomna-
lions as low az $50 and 800 bonds and
the farm loan bonds OF the Federal Loan
Bank in denominations as low as s.1
and $50 the Treasury authorities and
the experts allied with them IN their
loan operations have put the new Gov
eminent issues within reach OF many
million little investors who could never
have been appealed to with offers Of
81. 900 bonds. This means good deal
for the future OF the bond market amt
shows that corporation borrowers after
this In order to reach the bond buying
baby bonds Of a type which VIII appeal
20 ..mall investors everywhere.
The problem OF financing the war mas
been for all nations largely problem
Of interesting the small investor. Eng
land tapped a great reservoir OF wealth.
by organizing hundreds of war savings
societies to receive the weekly contrlbl-
tions 81 the wage earning classes. sales
of War Savings and Thrift Stamps IN
this country have aggregated about
81 900 900. 900 and the campaign has
been so successful a. 10 lead Congress TO
extend the limit OF stamps that can BE-
put out under the law from s.,000,1co,-
900 10 81 900 COZ. nh0, That form Of
savings has become So popular that Fed
eral authorities have been urged To con-
tinue the sale Of certificates after peace
has been declared. or through other
means to keep alive the interest OF the
people IN the thrift cause. All this
emergency financing comprising thetour
Liberty Loan issues and the sales OF War
Savings and Thrift Stamps has heen
handled al a cost to the Government o!
sbou, one-sixteenth Of / per cent. This
is remarkable SNOW ing. when IT is re-
memhered that nearly $4,000. 100000 ni
securities have been issued by the Gov
erument since the First Liberty Loan
was publicly offered on May - 1917.
No emergency measure of the var
period excited greater discussion than
fine proposal to organize tine War Finance
Corporation under the act o. April =.
1915. The suggestion provoked harsh
criticism In many quarters II being con-
tended that dangerous imitation would
result and that the corporation with It's
capital OF sS00u00.000 and the right 20
sell SO, boo. 900, 900 OF its securities, easily
might become a menace. Although priv
nged to make direct loans, IL served gem
orally as discount institution and has
been mana ged so conserv6tivelN that al
the end OF the first six months Of its eN-
lstence u showed less than S12.p00,O00
in loans Nearly all Of It's operations
have been with hanks through the red!s-
counting of bank Endorsed paper. In
stead OF being used as an instrument
OF initiation the corporation has heen
scarcely factor in the money murkct
at all. Its directors interpreted the law
to mean that the Institution was al
emergency eNpediert and had been es-
tablished frat of all TO aid vital indus
tries. The directors on August ; offered
to make loans TO the banks to help the
crop movement. Ten days later they an
nounced that they would make direct a d.
yances 10 individuals or corporations en-
gagged in raising live stock and still later
To the canneries or this Stnte.
The year in the stock Trarket has been
exceptionally interesting. uothwithstard-
ing the long period Of dull trading ard
the absence Of spirited speculation, Du'-
ing much Of TIE time the New York
market moved at variance with ior-
eigu exchanges, rejecting noteworthy
strength last spring. when the European
bourses we're depressed by the German
successes and the feeling that the world
war might be Indefinitely prolonged.
Later when the allied forces were achiev-
ing notable successes and the foreign
markets We're rejecting uubounded en-
thusiasm. trading here was often spirit
less and uninteresting. This apathy was
il. part accounted for. however, by the
close regulation Of the money market
ard the effective arrangement made 10
restrict the volume OF loans upon spec
ulHtive collateral. There has been ad-
mUable cooperation between the Treas
NY authorities and the Federal Reserve
Bank officers on one hand and the gov
rrning committee Of the stock Exchange
on the other