The Wolf Point herald. (Wolf Point, Mont.) 1913-1940, 1920-06-03
HALTING HIGH PRICE CRAZE
(Great Falls Tribune(

AALN+0 N%Ab AA0hAANF
We are not prepared to assert
without qualification that the decid-
ed action of the federal reserve
banks in raising discounts and dis
~couraging loans except for produc-
tive enterprises has knocked the high
cost of living down. But it seems
certain that it has been more effec-
tive than government prosecutions
of profiteers or any other single
step taken by the government to
check soaring prices. 1t has been
announced so often that the summit
of high prices has been reached that
we are a little cautious about MAX
ing predictions, but the Tightening of
credit and its dehation by the federal
reserve system is doubtless response
BILE for the flood of cut price sales
all over the country. 1t has led eau
tious business men to reduce their
stocks in order to pay their bills in
stead of borrowing money to stock
up with. 1t has also led to a letup
in the scramble for goods, and a
general feeling that goods may be
cheaper instead of dearer in the flu
ture. We note that some of the shoe
factories are running on short time
in the east, and lower prices for
leather and shoes are predicted.
The reserve banking system has
long ago proved its worth to the
country by financing the government
through a great war. If it succeeds
in checking the rising cost of living
at this time it will have served an
other patriotic purpose. The news
that comes from Washington is to
the effect that prices and the high
cost of living are on the downward
trend, probably not to be halted in
their orderly course until a point of
stability or some permancy is reach
ed. This is the opinion of expert
f~nanciers and economists in and out
of congress. That the peak of the
period of imitation has been passed
and that the nation is now to exper-
fence a period of orderly defation,
is the belief of many students of
economics.
The call made upon the federal
reserve banks by Governor Harding,
of the federal reserve board, for the
curtailment of credits except for
essential productions and the gospel
preached by the governor and now
being spread broadcast over the ma
ton by the officers of the reserve
banks that the financial situation
calls for sacrifices akin to those of
war time and for increased produc-
ton, increased savings and lessened
waste and consumption is having a
wholesome effect.
1t is predicted that there will now
be less speculation in the various
markets, and that money held by
spectators will be turned into the
channels of m to re-
lleve in part the strain upon the fl
nancial situation. To relieve this
strain and provide for the produc-
ton and movement of crops is the
problem of the banks, and finally the
problem of the public, for through
increased production and the prac-
tlce OF proper economy, the public
IAN solve the difficulties.
1t is in such a period as this that
the value of the federal reserve sys-
tenn is shown. Through this system,
It is possible to keep a firm control
Of the financial situation and apply
the necessary remedies in time to
avert anything in the nature of a
panic. Through the orderly process
defation, as is predicted will re-
suit if the public and the banks CO.
operate with the federal reserve sys-
tenn, the least possible injury will be
done to anyone. That the public
and the banks are cooperating and