New Britain herald., 1919-02-24

| favorable and the dispositie
| the task of taking care 6S
| binary foreign applications bl
! the hands of private financleA
| been more and more unres9
! accented by public men. Neverth
| as shown by Secretary Glass's
quest for authority to continues
| Vonces to foreign governments,saS
we'll as for power in the war F1na1k4
corporation to make loans IN alusSasa.
foreign cOmmccc. there is an ev1dGAM
appreciation OF the desirablllty
keeping up such trade even at thN
cost Of some public assistance Les
mands of foreign governments and
peoples which had been expected to
fall upon the money market with
great force by this time are still more
or less DELAYED There has been but
little new development in the direc-l
/ tons Indicated a week ago With
reference to proposed financing on
foreign account. Nevertheless the ex-
port figures for January. showing as
they do a record months total ag-
gregatng $62%,000, 1000, Indicate the
scope Of Europe's continued depend
cnco upon the United States.
There has been little change in the
money market. but such alteration AS
has taken place has been upward. The
views OF the secretary of the treasury
as to public finance at his confer
cnces with New York bankers on Feb
fuary IA and 10. were faVorably re-
cGlNcd and were regarded by them as
indicating a, disposition to make roa-
sonablc rates for the sale of the
new bonds. Since thai time there has
developed in the house of representa-
to l,LO al "a
authority for which the secretary of
the treasury has asked and Il cOmpro-
mise has been tentatively arranged,
but the Alternative proposals which
are now put forward, however Objcc-
tonahle they may be from some
standp0ints, nevertheless recognize
the necessity Of attractive rates if the
loan is to be hoat"d with success. The
new plan contemplates an authoriza-
ton of $1,000, 900, 900 in notes running
1 to years and divided into four
classes, as follows:
First-Fxempt from all taxation,
except estate or Inheritance taxes.
Second-Exompt from all taxation
except estate, or inheritance taxes
and the graduated additional income
taxes, commonly known as surtaxes
and excess profits and war profits
taxes.
Third-71Xempt from the same tan
alton as those of the second type ex-
ccpt that the interest on $4,000 of
bonds of this type shall not be sub
ject to the estate and the graduated
additional income levicS.
FOurth-IIxcmpt except from os-
tate or inheritance taxes. and all in
come excess profits. and war profits
taxes
If the department should announces
that these short term notes were to be
put out against loans made to foreign
governments. which oow total nearly
5000, 100000, and that they were to
be taken up with funds received in
payment for these loans. it would un-
doubtedlE create a worry favorable I'M
preston and would also have a stimu-
lating effect on the prices for out
standing Liberty bonds. most Of which
have long maturities. If the notes are
to be taken up by increased taxation
each year as they fall due, that
would be undcSir2 bic. as the people Of
this country arc already feeling the
strain from taxes. Considering that
the public already hold in round ~,un,
bcrs S16.S00. 900. 600 Liberty bonds. il
is quite likely that treasury notes with
easily hoated, more so than another
issue of long term bonds. especially if
their maturjties were to be made con-
current with tho loans falling duo
from foreign governments tho inter
est from which would moro than pro-
vide for the interest on our notes.
The prospects Of the new financing
ar oimproVing and the general drift of
affairs is toward recognition of the
high value Of IOanabIe funds The |
greatest danger in tn" situation is !
that under the new financial plans an
undue amount of the forthcoming |
loan may be left in the hands Of the |
banks. Purely as a market factor |
this might not be regarded with |
aversion, as the effect of it Will doubt |
less be TO keep prices up and stinu- |
late activity, thereby defcrring for the !
time being the inevitable reaction re
sulting from reimbursement. However
these matters may go, those who have !
loanable funds can reasonably look !
forward to getting full return for !
their money during The next few
months whether they invest i'll public |
securities or in issues that yield q
larger rate of return.
The REIMBURSEMENT process has
moved steadily forward. IT must be
admitted that some of the problems
growing out of it have not as yet
passed their climax Unemployment
has increased in various quarters and
in some lines demand is still dun,
with no assured prospect of revival
Foodstuffs have shown Il distinct
downward tendency as compared with
the high prices before The conclusion
Of the armistice, although they are
by no means back to pre-War levels
and not likely to go there. Wholesale
prices for various manufactured goods