Omaha daily bee., 1920-03-13
On tie Toboggan Slide
From Daily Finaneial America.

| In the winter Of business discomfort America
has come to slippery spot in the mountain
! path of progress. The crest is past We are
over the top. There Is a down grade ahead.
How do you prefer to make the descent?
The man who keeps his head will keep his
feet beneath him. He viii coast with caution.
A few will lose their heads and their feet. They
will find transportation on the seats of their
trousers, their knees their elbows and their
faces. Their clothes and their hides will suffer.
In the heap at the bottom we may expect to find
few broken necks Some will escape on
erutches It's hard, cold toboggan slide from
high prices to low.
The overloaded speeulator is in danger of
being crushed beneath the burden of plunder he
is striving to take from his fellows. He has no
business in business at such a time. The real
business man is in light marching order. He is
buying with caution, as our trade reports have
been repeating again and again in the last two
weeks
He knows very we'll that the choking of the
7 big stream of Americas exports surely involves
an accumulation here, II he has taken the
trouble to read the Agricultural departments
market reports he has seen that there is a great
store of food coming into the market in rising
volume. Ships at last are found sufficient for
the needs of our industry. There are more
than enough for our shrinking exports. Some
are leaving Atlantic ports empty in search of
other carrying trade.
Restrictions imposed on credit by the Fed
eral Reserve Board is reaching the mark. That
is the chief reason for uheasness of the specu-
lative holders of the big boards of food and
textile materials. Hoarding is becoming costly
pastime. The prosecutions by the attorney
general are making hazardous this sport more
cruel than the despised cocking-main Of the
Mexican or the bull-fght Of the Spaniard.
One OF New York's prosperous business men
may be mentioned as an example Caught by
this speculative fever, he employed credit that
he could have used to better advantage in his
nj he h,,ifd <nrsa ua
bought million pounds of pork products and
held it out of consumption-unt he was found
out and exposed. He is wiser and poorer now,
and is trying to keep out of Jail His expert
ence may serve to deter Others.
But the refusal of the banks to lend any
more money for these pernicious food and
clothing material boards is proving far more
effective than the slow processes of the criminal
law courts. t
Bank transactions, the index Of activity are
reced1ng to more normal volume The eleven
billion-dolar weeks, that alarmed the financial
community in November last, seem to have
been left we'll behind US. The persistent prun-
ing of speculative loans is chiefly responsible.
For the week of February IA the total debts
to individual accounts in the banks of the coun-
try were only nine billions This is below the
transactionY of October last, which averaged
o.2 billions week. 1t is we'll below the average
tor the five weeks ended December "a, which
was 10 billions week
SollpdIeu WITH iaSt syear aJ this time, Onr
nine billions week show an increase of S. per
cent. 1t must be remembered, however, that
the country in February, 1912 was passing
through period of reorganization from war
to peace industry, causing much temporary
idleness Compared with the period of imitation
in November and December, the present con-
ditions adds to our security. For this reduction
we have the Federal Reserve Board chiefly to
thank, as we'll as the national bank officers and
directors who are acting with it,
There are still some elements of weakness
in the nations financial position. There seems
no cause for alarm, but the need appears for
further decisive>restristion by the federal bank
ing officials. Our reserve bank note issue was
swelled during the period of extreme expansion.
From $2700,000,000 in October it was allowed
to run up to $3,Os7 100000 late in December.
Most of this increase of $357000,00 we have
still in circulation. The total February IA was
s9O00,000. While our bank clearings are
$200,000000 below, the October average, we are
using $2?9,0O0,00O more of this paper currency.
Considering that there was no scarcity of cur
rency in October, it seems time to send this ex-
cess paper to the furnace.