Evening star., 1921-08-07
LEADING BANKERS ARE BACK
OF FEDERAL RESERVE BOARD
Believe Restrictive Measures as Applied
Were Necessary to Avert More Serious
Trouble-Business Conditions
Improving at Fair Rate

tions and most capable defender
of Its actions.
"If an investigation is ordered. the
friends OF the system will be ex
pected to present a united front, as
its enemies undoubtedly will"
signs Are More Encouraging.
While business has so far develop
ed no great speed there has been
some recovery and the signs of the
times are certainly more favorable.
Higher prices of cotton greatly en-
courages the south, and the depres-
sion there is gradually giving place
to confidence. Credit elimination of
| one black spot in business.
The lessons of the past have been
learned in every section of the coun
try and some serious mistakes will
not be repeated.
Collections are better; thrift is
still a dominant factor money is more
plentiful and while. the general sales
may not total such a large volume.
they have increased considerably
and the dollar buys now much more.
Failures are less than last week
but more than a year ago. this being
natural. in view of the fact that
many concerns weathering the storm
a year ago have yielded to the strain
in the last few weeks.
Dun & Co are encouraging in their
weekly report Of clearings. noting for
the first time material shrinkage In
the decreases. while Los Angeles ac-
tually made modest increase.
The great staple iron and steel
markets have not reached the low
point in production price. and there
fore have not started on, the up grade,
but the leaders of the business pre-
dict an era of prosperity.
'.ThrOugh Period of Disturbance"
This is the caption of an article in
i the monthly review of the National
d II nf
"The United States is practically
through the period of violent bust
ness disturbance which began in May.
visible evidences of the distressing
conditions through which the coun-
try has been passing. but these oc-
currences should be regarded not as
! in(lices to forward conditions, but as
re'ating to the past
i Some businesses nave found DIM
Guilty in getting what they have felt
to be a fair line of credit. This has
been because of desire to operate
on a basis of inventories of raw ma
terials and goods not yet written
down or because in these instances
heavy investments have been made IN
plant and equipment at minated
prices In such cases they are MOI n15
! have to take their losses and adjust
their operations to make profits on
. real values only.
More Credit Than Required.
although occasional failure to Sc
cure desired credit accommodations
has served to keep alive the impress
sion that there is a shortage of bank
credit, the truth Is that there Is now
available a volume of credit larger
than present business requires. The
main requisite for a return toward
normal conditions Is the will to try
for business on a level where 1t can
be had.
of the raw material markets OF the
United States has passed. Recent
declines are due to conditions OF sup
ply and demand in specific lines. This
is a normal condition.
wholesale prices of many classes
of manufactures have been fully de-
fiated This is not true in all lines;
but recent cuts in the price of steel
and widespread reductions in wages
Indicate that adjustment in whole
sale prices will not be long delayed.
Retail prices show wide IRREGULAR
ties, and high-cost' stocks have been
largely disposed of. Price stabiltza-
tion is, therefore. not far ahead"