New-York tribune., 1920-12-23


In the early days-.even as late as
one hundred years ago-we find condi-
tons existing in which the individual
who carried on trade was not only a
trader but ship owner, and his own
banker as we'll. For example-in the
carly nineteenth century our enterpris-
ing merchant of New England would
buy a cargo that he thought he could
sell in certain part of the world, load
it aboard his ship and either he him
self or his partner would command
the ship. The ship would set sail from
New England port to the Far East
Tor instance, where the captain of the
| hin would barter with the natives, ex.
changing his New England products for
1ea, spices or other native products
and return to his own port with the
cargo, where it would be sod.
Development of Trading
The individual carried on all the
functions of our present complicated
system of trading. No banking faciii-
ties were necessary for doing his busi-
TRANSPORTATION facilities we're needed
Gradually, as the volume of trade be-
tween any two countries became great
CT. it was found more economical tc
send representatives to foreign coun'
tries to buy and sell and to inform
rne home office what could be sold and
what could be bought to the best ad-
vantage.
As the necessity for frequent ex-
change OF goods made it necessary to
establish regular lines OF ships witf
FREQUENT sailngs it became possible
for the owners of ships to serve more
than one trader, and Transportation
md trading were, therefore, divorced
+ In the same way the system Oh par,
ter was broken down. 1t was founo
advisablo for merchant to sell for
currency instead of taking payment m
goods. or to buy with currency instead
Of with goods. Thereby came the ne
cessity for banking facilities to handle
the medium of exchange in foreign
countries and to convert the mer-
chants balance from the currency OF
one country to another. 1t was found
desirable and necessary for merchant
to exDand his business beyond his own
capital, and at times to borrow from
the banks to carry on greater VOL
ume Of business. so the function OF
banking was divorced from the old
self sufficient system of trading.
Basis of British System
England has built up her great trade
bv the support of the two service
features of trade-namely, foreign
banking and shipping. Neither one is
an entirety in itself, but each IS inc
servant Of trade. The government, rec
ooniz;ng this. has supported and de-
veloped through wise system OF laws
the British banking system and opera
ton of ships. The government has
stood behind the merchant who wished
to trade in any part Of the world and
has seen to it that his interests were
protected in foreign countries.
Up until recent years the United
States had no vital necessity for the
development Of its foreign trade be.
cause our surplus products werF
largely raw products. The foreign con
sumer bought the grain, the cotton
etc, that he needed and paid US in
cash. We Were market for manu-
featured goods, and England and Ger
MANY and other countries competed fol
the sale of goods to this country.
Prior to the war we had begun tc
have a surplus in certain lines anC
our manufacturers realized that they
could sell their surplus to advantage
abroad Then came the development
of the export business Of such com
panies as the Singer Sewing Machine
Standard Oil, General Electric, Fore
Automobile, United States Steel, etc.
Surplus Must BE Marketed
AS a result Of the war, we find our
selves with a surplus of manufactured
goods Judge Gary speaks Of 20 pc
cent surplus Of manufacturing capacity
We must either find market for thi
surplus or retald our commercial de
velopmcnt. We are beginning to bull,
up the same system England has; Ger
tain Of our banks are developing thei
foreign branches and connections. Tn
proposed $500, 900, 900 Edge law corpo
ration is being formed by our banker
TO assist the expansion of credits 70
our foreign trade. Our comp e'rcia
hces, the result of the war constfuc tior
is giving it's services to develop ou
ocean commerce.
our meichants, our bankers and ou
. ship owners must work hand in hand
realizing that each one is dependent Of
( the other for the marketing Of our sur
plus products and for the purchase o
products Of foreign countries rcQuire'
IO1 home consumption. Our govern
nent has stood and, through legisla
ton, must further stand behind ou
trade machinery, 80 that the American
merchant, banker and ship owner cai
compete on an equal basis with his for
cipn competitor.
One important principle to be adoptc
as national policy is that the com
sncrcial interests Of American citizen
must be protected by our goyernmen
in all parts Of the world. In the earl
days, when our shipping was prosper
GUS, the government Of the Unite
states guarded very jealousy the right
If its citizens who were engaged i
lorcign commerce.
Inia country win not find it eag
--e--~--