Albuquerque morning journal. [volume] (Albuquerque, N.M.) 1903-1926, 1920-03-01
SUDDEN ENDING
Of EXP ANS|ON
IN \ MOST LINES
IS PREDICTED
Financial and Banking Au-
thoritieS Everywhere Are
Beginning to Look Seri-.
ouSIy Upon Credit 'Sit "
UPWARD MOVEMENT OF
PRICES NOT CHECKED
Banks Are Said to Be Exer~
Cising a Greater Degree
of Discrimination and
Judgment in Business,

icy MORNING JOURNAL SPECIAL LEASED wIREl
Washington, Feb. 20. - Early
| ending of the general expansion
which has characterized war and
immediate postwar periods were
forecasted in statement summar-
izing February business conditions
issued tonight by the federal re-
serve board. The upward move
ment of prices, so far as the board
could ascertain generally, had not
met with any check.
Financial and banking aGthori-
ties everywhere We're asserted to
be looking more seriously at the
general situation in credit and be-
ginning to urge the adoption Of
conservative policies. While the
view asserted this could not be ac-
cepted as meaning that the "orgy
of speculation" rad been absolutely
checked, there was said 10 ne IN
disputable evidence that banks
were exercising a greater degree
of discrimination and judgment II
complying with the demands II
their customers.
Throughout practically all Of
the reports of federal reserve
agents," the statement said, there
runs plainly a recognition OF the
| existence OF an over-strain"d cOu-
Gition of credit and Of some con-
tinued tendency toward speculative
! operations, High living c,tsts pld
the upward movement of prices
have apparently not been checked
although there is a decrease N
prices in certain lines and a tend
ency toward restricted trade IN
others. Interest rates are rising in
most districts, while banks are eX-
ercising a greater degree of dis
elimination and judgment in meet"
ing the demands of their customers.
The increase in interest rates has
had the effect of lowering security
quotations the board found, as even
the best investment securities have
suffered in this respect. 1t also
has had the effect of forcing q
shrinkage or contraction in the vol
ume of trading in all classes of Sc
curities, the magnitude of which
was regarded as alarming by the
board several months ago. In some
federal reserve districts there were
indications of a reduction in the
volume of speculation in commodi-
ties.
The effects of the increase in
discount rates" the statement con-
tinued, make themselves evident in
a more conservative attitude on the
part of member banks with respect
to industrial expansion and in the
recruiting of commitments on spec
ulative account.
Contraction of bank credit was
not, however, exactly general
throughout the country, but the re-
duction reported in New York dis
trict was partially offset by an in
crease elsewhere. A decline in bank
deposits, both in financial centers
and elsewhere has occurred, a part
being due to the withdrawal of
government funds. Very great diff
ficulty in placing both commercial
and conservative investment securi-
ties in satisfactory quantities is re-
ported by dealers"
General prospects at the close of
February were for an active and
prosperous spring season in all
lines, the statement said. Agricul-
tGral prospects were said to be "re-
assuring" and the curtailment in
exports. due to the exchange situa-
ton, was undoubtedly beginning to
make itself felt and was believed
by many of the banking authori-
ties soon to be of benefit to the
consumer rather than Injurious. 1t
was pointed out also that there was
tendency to resist the advance
in prices and that greater care
was being exercised in purchasing
all of which were regarded as
Favorable symptoms"
General manufacturing was re-
ported very active all over the
country.
Wholesale trade conditions were
said to be prosperous almost
throughout the country In re-
PORTING individual lines the state
ment remarked that the demand
for good grades of shoes. regard
less of price, seems to continue and
shoe price lists for the new season
are higher than ever,
Some improvement was noted in
general labor conditions. There
was an "unfavorable aspect" how
ever,'a tendency reported from va
rious districts towards a restric-
ton of output. Even in those
cases, it was shown, the opinion
was occasionally expressed that the
effect of the restrictive policy is
beginning to be understood by
those practicing it as injuring them
as much as any other class.
The most serious situation in the
labor field is that of farm workers
a genuine scarcity is noted, which
the board feared might result in a
reduction in farm acreage. This
was said to particularly true of the
southwest and some apprehension
was felt as to the solution of the
problem in that region with the
spring season coming on In many
communities,