The Richmond Virginian. (Richmond, Va.) 1910-1920, 1920-02-06
SENATOR HITCHCOCK
CALLS CONFERENCE
I, FOR RATIFICATION
Householders to
Notice Changes in
Prices Very Soon

New 1ork, rep D mere
will be history made in Wall
Street before ny return" was
the cryptic remark made today
by Henry r. Dawson, the banker,
Just before he sailed on the
Cunard liner Mauretania for Eng
land. Accompa nying Mr.. Davi-
son, who is chairman OF the
league OF Red Cross organiza-
tons. was Eliot Wadsworth. who
is vice-chairman of the Ameri-
can Red Gross central committee
Mr.. Davidson's prediction.
while ii WAS eiucidated by no
explanation by him and comment
upon which was refused at the
banking Offices of j. P. Morgan
company was regarded as refer
ring to the curtailmant OF
foreign markets for American
goods through the tremendous
drop in foreign exchange and the
expected drop in the cost of iiv-
ing as a direct and almost i'm
mediate consequence.
Financial men, exported and man
ufacturers discussed with very lively
interest today the changing conditions
growing out OF the new situation, the
concensus apparently being that
with foreign exchange at low ebb,
Europe will perforce limit imports
to the barest necessities. Restric-
ton on broad scale of the purchase
of American goods would release In
the American market for consumption
here a large quantity of American
made goods and prices would tumble
accordingly. it Is held.
Cotton, food and other necessities
imperatively eeded in Europe will
soon constitute the chief exports from
America until Europes financial
equilibrium Is restored, according TO
a prediction in the British Manches-
ter Guardian cabled here today. This
will follow as result of The curtail-
ment of imports by Europe in a
general exchange rate adjustment, the
Guardian asserted.
Henry p. Davidson declined 10 dis
cuss the mission upon which he was
sailing To Europe. or to state whether
II related to public or private affairs
but his remark that there wilt hs
history made in Wall Street before
my return" gave rise to belief that mis-
journey which will take him TO Lon.
don and Paris, is intimately related
to the foreign exchange situation.
From various points on the United
States side of the Canadian border
came reports today that the discoun,
rate on Canadian silver and currency
will have a sharp advance beginning
tomorrow. American banks demand.
ing 20 per cent instead of the pre-.
vailing 10 per cent discount.
The long suffering consumer is a.
last TO get relief through the newt
able consequences of the foreign ex-
change collapse. according to state
merts received here from Chicago
bankers. who declared that all the
legislation. federal price commissions
and housewives campaigns combined
the decentralization of foreign cur
rency is. doing and will do 10 smash
hign prices in America
American exports must practically
cease with the low rate of foreign ex-
change. and that the inmutable law
OF supply and demand must operate
to bring prices down when American
made goods. barred from export have
piled up huge surplus in this coun-
try,
The reduction in prices will
continue until the United States
begins buying heavily abroad,
declared President NJ. A. Traylor
of the First Trust and Savings
bank of Chicago. This would
send the rate of exchange up
again. In the meantime an en-
orrnous surplus win accumulate
in this country, due to the cur
failing OF exports. While this
may mean unemployment for
many persons, it will mean a
sharp reduction in the cost Of
living. Wages at course viii,
come down with the prices. but
the salaried person who has had
slight raise in pay will hene-
tit thereby. Tho question OF how
soon the consumer wifi feet thu
reduction in prices will depend
largely upon how soon ne cease
exporting goods. Indications are
that the householder will notice
change in prices very soon"
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