The Bemidji daily pioneer. [volume] (Bemidji, Minn.) 1904-1971, 1920-11-20
BANKER COMMENTS ON =
: CURRENT CONDITIONS

In a statement prepared for the
Guaranty Trust company's >publica-
ton, The Guaranty News, Charles H.
Sabin, president of that company,
comments on current conditions as
follows:
"There are some important con-
siderations which should be borne in
mind in the present situation by all
who seek to analyze it accurately.
I'm the first place, there is nothing
mysterious or unexpected about the
present condition in either the COM
modify or security markets. For
months it has been certain, and it
has been repeatedly so stated by stu
dents of the situation, that there
must be liquidation Of commodities,
securities and labor before this coun-
try could fully recover from the ef-
fects of the war and be restored to
anything like a normal business ba-
sis. 1t was inevitable that the pro-
cesses of readjustment should be
painful in many respects and in many
instances, but that they were and are
inevitable was a matter of common
knowledge among all who seek to
study these problems apart from i'm
mediate self-interest. The regretable
thing is that as commodity and Sc
curity prices reach points far above
their real value in the boom period,
SO they are today falling to points
far below their real value. Neces-
sary liquidation is proceeding, after
the manner anticipated, on the
whole, but there are yet several
steps to be taken.
"Perhaps the most Important of
these is for retail merchants to real
ize~ that they too must meet the in
evitable economic trend and adjust
their prices to meet the new condi-
tiCns. Only in that manner can the
situation be stabilized and frozen
credits thawed out. Know this is
not a pleasant message, but I am
firmly convinced that the sooner
such a policy is pursued, the less
costly and painful 1t will be to all
concerned. The process of deflation
must include all the elements in the
body econ omic sooner or later and
there can be no escape from the in
exorable law which directs it. .Dodg-
ing the facts or attempting to post
pone the inevitable will not bring
immunity to anyone whether his in
terest lie in production or distribu-
ton, capital or labor.
1.-THE unfortunate effect in such a
situation is always that many limo
cent parties are made to suffer thru
ignorance and misunderstanding
and also thru the spread OF false and
malicious rumors which such condi-
tons always inspire, with a result
ing loss of confidence and panic
sales.
"There is so much in the present
situation to inspire confidence and
hope for the future that it IS little
short Of criminal for anyone to paint
the picture SO blackly, thru either
ignorance or intent, that these vital
facts are obscured. To cite a few
pertinent facts: This country will
harvest this year one of the largest
crops in its history; its transporta-
ton congestion has been relieved
and it's railroad system is for the
first time in a decade on a sound f.
nancial and operating basis; we
have passed thru national election
and assured four years of sane ad-
ministration Of public affairs: ovr
banking system has withstood the
greatest credit strain in it's history
and is on sound and workable
five years of splendid prosperity is
basis; the accumulated surplus Of
stored in many ways for our con-
tinued use; the markets. of the
world demand our products and a
great mercantile marine is prepared
to- transport them: this country has
not been over-built or over-extended
in any Of it's underlying activities,
and faces no programme of readjust-
ment along these lines such as usual
ly precipitates panic conditions. We
are in the souudest financial, indus
trial and political condition of any
important nation in the world
:'These are the simple fundament t.
al facts of our business situation,
and to consider the present reaction
as anything but temporary set
back from the destruction, imitation,
extravaganza and unsound economic
conditions preeipitated by the war is
simply not to reckon with the truth.
this country was first settled, that
1t remains true today, as it has since
amy man who sells the United States
Of Americans is in the long
run certain to lose,' and, further
more, any man who seeks to profit by
the misfortunes of others in the cir
culation of misstatements or false
rumors. hoping to prtcipitate further
reactions, should be branded as a
public enemy.
"This is 4 time for clear thinking
and courageous acting and in the