The Washington times., 1920-01-28
High Discount Rate Has Not
Started the Liquidation in
COMMODITY Market.
By nOERsIANER.

Even the not too numerous bankers
who thought a higher rediscount
might be salutsry condemn the
abruptness and extremity OF the
action that made the rate per cent
from 4x. A gradual increase TO
bh per cent had not been. perhaps. 30
unsettling. they think.
Certain Il Is that the jump to the
extreme limit has provoked wide
.erprises have been estopped, but TO
date. the designed liquidation OF
stored commodities and OF land deals
had not been Initiated.
on Europe-which the Washington
Administration IL energeticaily strls-
ng to aid financially-the enect OF
The sudden lift IL the contrary TO
what the Government proposes. Con-
siderable planned credits on the part
II Americans has been waived. The
number OF bankers who had Intended
o finance exports had been reduced
since last week; a process OF hishiy
Undesirable elimination which must
have had some influence, today In
,reak ing foreign exchange rates 10
levels that the most confirmed ms
hau not NchtuiNN ~
ilct two months ago.
The author OF The Rise OF sias
Lapham" thinks we have grown and
are growing a mightier and m gh .ier
people in material wealth ana ma
terial force, but for frugal ~ we
have substituted boundles3 pred l
ity. IL not profiigaey; we cam u spend
more than we earn for there Is no
md to our earning capacity, ne DC
lieves. Our ingenuity is bou ess
our invention Is nowhere para ei co.
We are the nrst OF the wor.ds mat
rial creditors. but we are not becom
ing great authors. great arti ;
great moralists. Instead or these our
men have become the e. eatest o. the
worlds money winners. ana our
money wasters.
An economist must dissent from
the economic estimate exprsss'd by
Mr.. Howels, but of more impo -
the psychological aspect missed In the
comparison between the late COS ana
early 7O's and the present
The dissolution of credits, the mui
tifarious and scmi-worthless cur en-
cies. the political jobb ng and all
manner of carpet bagging shattered
financial morality woefully for at
least ten years after the civil war
peace. Wall Streets record. pee n
auy the New York stock exchange
reads like a novel OF ultra nigh
bind "ry.
What the United States experienced
at that time the world at large ex-
perienced economically during Guar.
ter of a century after Napoleon had
been interned on st. Helena. Those
Ma polc onic wars had demoraliZed Eu-
rope, and the Generalization engen-
!e. ed men a m d COMO y
Such a period-like the mirror de-
basement here in the 6Oc, forms
class Of men shrewd. vigilant, inven-
tive; of men whose dexterity tri-
umphs over the most perplexing cop-
binations of circumstances who e
presaging instinct no s'gn OF the
times can elude. But II Is an I'M
propitious epoch for frm and ethical
principles. The political and eco
, nomic changes, violent and frequent
preclude the forming of perma nent
connections, prevent a settled policy
In the midst of the constant eddy
and change self-preservation becomes
! the first object of the finance er and
| industrialist. 1t is a task too hard
for the strongest head to keep itse
from b. Tomin gi dv the
whirl. Public spirit becomes out Of
the question. A laxity OF primo pie
becomes too common to be scanda'ous
This 10 what Europe is re-facing;
this Is what America must guard
against. Wise and temperate &C
tions-not impulsive and intemp rate
moves-should be the order of the
times.