The public ledger. [volume] (Maysville, Ky.) 1913-1968, 1921-06-27
MONEY AND MARKETS.

Business at the beginning Of 1921,
faced three primary obstacles to the
conduct Of affairs on anything like a
normal plane. Commodity prices were
still in many cases grossly inflated.
Wages wwere still on war basis. The
banking position was obviously strain
ed These obstacles are not to be re-
garded as entirely overcome, but much
progress has been made.
Six months ago 1t scarcely seemed
possible that by this time prices for
many raw materials would have
reached point Of approximate stabil-
ization; that wage reductions would
have been accepted by workers in
widely diversified industries in the
realization that they were just and
necessary, and finally that the bank
ing position as a whole could have
Impressed to the extent indicated by
the substantial reduction in the Dor
rowings Of reporting member banks at
the Federal reserve banks. Such bor-
rowings have declined nearly 40 per
cent from the maximum reached last
fall.
Sentiment with respect to business
will naturally fluctuate in times like
these The reaction from the squirt in
spring business has caused disap-
pointment. The end of the premature
revival in the automobile industry and
the renewe downward movement in
the prices of some commodities, not
ably sugar and petroleum have been
factors in bringing about a spirit of
pessimism which is not entirely justi-
fled when the improvement in funda-
mental conditions is considered
On the other hand, 1t is unwise to
expect other than quiet business dur
in gthe summer months. Satisfactory
recovery can come only after pro-
tracted period, during which price
liquidation must be completed as to
manufactured and semi-finished goods
and confidence in the future restored
Closely connected, too, with domestic
business is the state of trade abroad
and especially in Europe where politi-
cal considerations must be a powerful
influence in shaping the future. But
in this direction also encouragement
may be found in the fixing Of a defin-
lite schedule of reparatiOns payments
as well as the now plainly discernible
determination Of most of the peoples
of Europe to resume productive enter
prise as rapidly as possible.
The attitude of labor as expressed
in wage disputes especially in New
England and the middle west has seri-
ously retarded building operations al
though increased acticity resulted in
a larger total of contracts awarded in
May than in April. The F. w. Dodge
Company's valuation of contracts
awarded during May in rs northwest
ern states is $232,0O00 900 as compared
with 1921 100000 in April and $247,-
100000 in May, 1920. The valuation Of
building permits granted in the prin-
cipal cities of the United States during
May show decline from the April to-
tai of about per cent, indicating that
the usual seasonal decline in building
operations is in effect.
Progressive increases in the weekly
totals of revenue freight loaded on the
railroads of the United States, which
have advanced from $4,000 care for
the week ending April 2 to $4,000
cars for the week ending May %, in.
dictate that railway traffic once more
is approaching levels which will make
possible operation without loss. April
statements of gross and net earnings
now available for most Of the princi.
pal Systems, also exhibit improvement
over the average for the first three
months of the year. It must not be
forgotten that comparison with the
corresponding month Of 1920 is will
the .periad Of the switchmen's strike
when freight movement was greatly
disorganized throughout the country
and was almost at a standstill or
many lines. The favorable showing
made in the reduction of operating ex
penses during April is also at least II
part the result of the determination o.
many roalroads to postpone mainten'
ance and other work ordinarily under
taken in the spring until the new wage
scales announced by the Labor Boart
are put into effect on July 1. The re-
auctions announced by the board OF
June /, while less than the demands o.
the railway managers, are large
enough to be Of material assistance