The Washington herald., 1919-08-05
Financial News----New York and Local Stocks
R. R. zone PLAN
PROS AND CONS
Holland Calls Vital to War
burg Scheme Feature
Lovett Opposes.

Juoge Loyett was quoted rev
days ago as having spoken untavor-
ably Of the proposition that there be
regional OF zone divisions into
which as a whole all OF the Ameri-
can railroad companies be brought
Judge Lovett seems to have been
OF the opinion. IL he was correctly
reported, that it would not be to
the advantage Of the strong or the
weak railroad companies if there
were consultations of this kind.
Nevertheless, the so-called Warburg
plan for the restoration Of the rail-
roads and their wise, reasona ably
prohtable and economic direction and
mana cement. includes the so-ealled
regional or zone plan. In fact this
seems to be the vital feature OF the
"arourg plan. 1t is in line with sug-
sessions which have been made by
some of the ablest railway operators,
as for instance Howard Elliott 1t
IL In line apparently with recent sug-
rector General HIKES.
II it should be adopted than there
will be established an authorized
grouping into twelve regions. pos
sioly no more than ten, which as a
whole will cover the entire United
states. The weak railroads will be
asslmilated with the strong ones and
this Is not to be done by territorial
adjustment but instead along COM
mercial lines. Undoubtedly New Eng
land, not because that is section
OF the country which is distin guished
oy boundaries but because Of her COM
mercial relations to the rest OF the
country and OF other parts of the
country TO New England, will be es-
taoilshed as one OF the regions. her
railroads being absorbed by or afili-
ated with one or both Of the great
trunk lines.
So it will be in some parts Of the
south. The plan is spoken OF as the
"arourg plan because soon after his
retirement from the Federal Reserve
Board at Washington. Mr.. Warburg
TOOK UP, with others. the consideFa-
ton Of the railroad problem. There
vas recollection that he had earlier
gwen valuable counsel and assistance
IN the drafting Of the Federal Re-
serve Banking Law, although others
than he received the credit With Mr.
Warburg were associated some Of the
leading railroad operators of the
country and some government off,
GERS, who were in frequent consulta-
ton.
The publication Of the warburg
plan after it was laid before the
House Committee of Commerce
seemed to infuse new confidence in
railroad properties for the market
quotations for many Of these prop
critics were increased, that being
due, as is presumed, to the favor
with which the warburg plan has
been received.
Judge Gary and Our International
Trade.
Judge Gary seems not to have abat-
ed one whit from his hopeful and
very optimistic condition Of mind, es-
peCially as he considers the future
Of our International trade. He is GER
tain that. il certain contingencies like
the staoIlizing Of exchange can be
favOrably met. we are to have an
international trade which probably
will compel the operation Of American
manufacturers to the utmost capacity
Of their plants.
But Judge Gary wants the United
States to import upon relatively as
great a scale as our exports are
sure to be. For he says that if we
do that we shall facilitate the
liquidation Of the inde btedness
other nations owe to the United
States on account Of the commodi-
ties purchased here. But it is ap-
parent that there are to be some
obstacles in the way of heavy i'm
pOrtations from Germany These
are due to the state of mind of the
American people. A little incident
will illustrate this mental condition.
A business man who had need OF a
pocket knife of excellent grade Wis
tied one Of the largest of the shops
Of New York where a speciality is
made OF pocket knives. He was
asked timidIy by the clerk If ne
would object 10 a German pocket
knife. In reply he said that II
would go somewhat against the
grain for him to buy a German
pocket knife. although he knew
that the quality was OF the highest.
Then the clerk confessed to him
that it was almost impossible to
sell any German made goods. A
tacit, unOrganized boycott against
German commodities seems to pre-
vail. Investigation showed that
this disposition has been observed
toners are not willing to buy
German-made goods although ac-
knowledging the superior quality Of
some of them. 1t may be in time
that this feeling will pass away
At present il prevails not only
here but in other parts of the coun-
try Therefore If Judge Gary's
hint that the United States buy
heavily of commodities produced
by other nations be acted upon
with respect to Germany. the prob
ability is strong that for the pres
ent almost all Of the German com
modities imported into the United
states will be raw material OF
other things that are convenient
ana expedient for use in American
manufactured Industries. Some
time must pass however before
Germany will be able to export
much to the United States.
Bernard Baruch In the Future.
The friends of Bernard Baruch in
the financial district have no doubt
that in due time he will be found
serving. If President Wilson has his
way, as the American member Of the
reparation commission. That. how
ever. is a matter Of less interest to
Mr.. Baruch's friends than are the
reports which profess to set forth
what his plans for his vocation in
the future after he has retired from
Official lite may be.
The impression is 'strong in the
financial district that Mr.. Baruch has
closed the chapter in his career which
tells the story of his brilliant and
successful speculation in securities.