Grand Forks herald. [volume] (Grand Forks, N.D.) 1916-1955, 1921-07-18
PHILIPPINE

An article by Jose p. Milencio, a Philippine
ritter sets forth the financial conditions existing III
leNPhill1ppines at present, and undertakes to justi-
the demand for an extension of Indebtedness
rom fifteen million dollars to thirty dollars, as pro-
osed IN q request presented to congress quite re-
entity. Ihe writer argues, that the need for this in
tease IS not a demonstration of unsound financing
llFsof business unwisdom in any direction, as he
olds that the assets of the Philippines abundantly
Sarrant this proposed increase Of Indebtedness.
There is little doubt that the increase will be
Fanted, no great objection having been presented
ut there is one paragraph in Mr.. Milencio's article
shich merits some attention. He says:
The trouble is not with the %Filipinos. Their
Haelves are crowded with clothing, shoes, and other
manufactured goods. They have all the mechanic
IL power they need, and all the labor they want.
transportation and communication facilities are
anctioning normally. AS regards the national
ank, it has a superluity of assets, but these are
Encouraged by the tremendous prosperity expert
saced soon after the signing of the arrnistice, this
e1ni-governmental institution carried on an extern
We banking business, extending credits freely to
3s1vate commercial enterprises and lending money
cocoanut oil concerns, copra producers, sugar
@Ianters, and many Others. The depression ensu-
tg found its funds tied up. If only the war boom
puld be revived the difficulties now felt would
Tindle, or even disappear. World industries how
gger, seem to have come to a stop. international
NuS-SHlPmeHlS OF goods nave ceased. 1he ma
ainery OF exchange and credit is clogged and does
1T function as usual. Consumption even of goods
He'd necessities has decreased"
In that paragraph, Mr.. Milencio touches on 4
atr1re which has been mentioned in this paper on
veral8 occasions, and which is characteristic of the
tire business situation. There was a war boom.
hat boom collapsed because it was based on an
tsound foundation. In the natural order of things,
could not last. There must be a return to some
aSng approaching normal conditions. Prudent
Esiness men in every line have realized this, and
I've undertaken to adjust their affairs to the ne
ssities OF the occasion. In some instances, peo-
neglected to do this. They undertook to per
stuate an artificial condition and in order to do this
y did as Mr.. Milencio says, extended credit right
d left until their funds were tied up. Naturally,
II end must come. The collapse of the boom was
svitable, and those who had attempted to stave of
inevitable found themselves caught. The
Elippine bank acted unwisely in its attempt, and
Bank OF North Dakota acted unwisely in a sim
~ attempt Banks everywhere which have made
IS attempt have been unwise, and most bankers
10 have participated in that effort have recognized
follysof their course.
The most that could have been done safely ,1n-
any circumstances would have been to make the
Enrn to normal conditions as gradual and as pain
IS as possible. The return could not be ayerted :
ltller should it have been. But the attempt to do
Pre- than equalize conditions while the readjust-
INT was taking place was bound to fail. It failed
the Philippines and it failed in North Dakota.
Il could not do otherwise than fail anywhere.