Evening star. [volume] (Washington, D.C.) 1854-1972, 1920-08-14
FINANCIAL CONDITIONS
ARE GREATLY IMPROVED
Indications Are That Stock Market Has
Passed the Worst and Is Now on Way
to Recovery-Favorable Factors.

prosperous. so it turns about and COM
mences to go upward while the out
side surroundings remain adverse
Nobody can see how there will be
room for any fresh speculation for
some time to come. But it is con-
linite1y turned the corner and has set
| it's face toward Improvement in bust
| ness and let-up of the credit strain
| that will occur later.
Credit Situation Better.
There is no question about the
| change for the better in the credit
situation. This will not be reflected
yet awhile in current bank state
| ments. because all the slack released
| by the heavy fall in stocks, in cotton,
| in grain, in sugar and in many other
! commodities, is being taken u D by
F., the crop-moving demands But there
| is little doubt that under the work.
ings of the federal reserve system
preparations to meet the special needs
of the harvest sections are much
farther along than they usually are
at this season, and it seems a proper
| inference that the peak of the autumn
| strain will be reached at corre-
spondingly earlier date. Will it be
reached in time to permit a modest
prediction boom of the sort that
/
of a presidential year?
| There can be no important and last
| ing decline in money rates until the
Federal Reserve Board sees fit to
lower it's scale of discounts. and it is
] hard to see where this will occur un-
til the early part of 1921.
| But If the bulk of the crop require
ments have been met by october it
will be possible to lift the lid that has
been clamped down so hard
| Comparatively Better.
! When we compare the present situa-
| ton with that of two months ago there
is certainly a marked change for the
| better. In June there was grave doubt
AS to the outcome Of the crops. The
condition of cotton was the lowest on
record. corn had had bad start, win
ter wheat was admittedly short. Since
then has come the astonishing and I'M
paralleled recovery in the cotton fields.
Winter wheat has turned out much
| better than expected. spring wheat has
! been up to the average and the COM
bined wheat production comes close to
the very gratifying total of 800, 600, 600
| bushels.
| Wonderful growing weather through
July has so improved the status Of corn
! that the promise now is for yield OF
word. instead of theScomparative short
age that was apprehended at the be-
! ginning of summer we now have the
assurance of harvest in all the prin-
cipal staples far ahead of the ordinary.
| Two Months Change.
| In June there was much uncertainty
as to the attitude of the Interstate Com
| merce Commission. Now the rate de-
cision has been rendered and is univer-
sally regarded as more liberal than the
| fondest expectation. In June no prog
ress had been made toward the solution
of the transportation difficulties. The
latest figures on the car movement es-
| tablish the fact that this extremely Sc
rious problem is well on the way to-
| ward solution. Likewise in June, while
credit expansion had been checked, little
had been accomplished in the way of de-
flation. Serious doubts were entertained
| as to how the banks with their COM
paratively low ratio of reserve could
meet the extra strain of the harvest
financing. Two months have passed,
and, thanks to the liquidation in the
stock and commodity markets and to
the curtailing of credit in many other
lines, bank resources have been mob
ilized for use in the crop sections. not
only without weakening the reserve po-
sition, but leaving it somewhat better.
tCnDyri1ht 1920 nv s. p WeSt)