The Washington herald., 1921-04-25
SIGNS OF RECOVERY
ARE BEING NOTED.
In MIDDLE WEST.
Improvement in Banking
And Credit Situation
Indicated.
ABUNDANT HARVEST.
Fairly Active Spring Trade
Has Carried Hand-to-
Mouth Aspect.
ABUNDANT HARVEST

KANSAS CITY. April s4.-with
what promises to be an abundant
wheat harvest only ten weeks
away and the pressure of spring
work demanding attention. the in
terror is. too busy to give much time
to retrospect and is turning its at
tention to the future. 1t Is recog-
nized that II must work out Its n
nancial salvation on a new basis Of
values, and the habit Of holding
post-mortem on every possible oc-
casion is passing. To be sure, wheat
has gone to a dollar and corn Is
somewhat Of a drug on the market.
but having weathered the past six
months, the average business man
believes that he can win.
Spring trade has been fairly ac-
tive all through the country sec
tions, but II has been a hand-to-
mouth process, the farmer not yet
being convinced that retail prices
have reached bottom. Little change
Is expected in his attitude of close
buying until after harvest. In con-
sequence stores are carrying moder-
ate stocks and waiting on events.
Much Is going to depend on how far
the producers new idea of co-opera-
tive marketing brings results.
whether 1t can be forwarded to
make much difference in this years
production movement is doubtful,
but the psychological effect is likely
to be beneficial and give him larger
confidence.
Banks show Improvement.
The banking situation. however.
is reaching a more satisfactory
position. Deposits have ceased to de-
cline, and loans are being slowly
reduced. The change Is not great.
but it is in the right direction.
which Is most important For in
stance. the Federal Reserve Bank
here last week affected a reduction
in loans of S3,s65.ooo. the present
showing of loans being sls.751,0 900
less than a year ago. at which time
the bank showed rediscounts with
other reserve banks of s6,000,000.
The reserve ratio is now 43.6 COM
pared with ALL q year ago. The Mis-
souri, State Bank report shows an
Increase in deposits OF over $23, ,00o.-
900 from December to the February
call. and probably a much larger
figure would now obtain. At the
These things are all indicative OF
the gradual helpfulness of the
banks policy of restraining unes-
sential loans. Naturally the effect
has been to limit expansion, and
bankers continue to give advice
against starting new enterprises
without abundant capital.
They are trying to impress a
MAUI idea IN the small hnSineSS ma n
also-that he should create a sur
gencies rather than depend on his
bank to meet every exceptional sit
uation. Few of the smaller busi-
ness houses do this, and education
may make future crises a far less
strain on the banks. uring the
past three months merchants have
been heavier borrowers than usual
finding their income reduced by the
cutting down of prices to stimulate
buying, without getting all the ex-
pected results.
Along with this is the continued
tightness Of the money market
The banks, while they feel some
what easier, are by no means back
to normal. Rediscounts still appear
in the daily reports and seem likely
to do so until after harvest. Few
are exempt from this feature. which
for many years was unusual and
consequently 1t is an aggravating
feature. The tendency to buy Sc
curities when a surplus is available
takes out of local usefulness much
capital and has it's effect on the
liquid resources of the institutions