Atlanta tri-weekly journal. [volume] (Atlanta, Ga.) 1920-19??, 1921-10-06
BANKERS PRESIDENT DEGREES
|PESSIMISM IN BUSINESS
John S. Drum Analyses Con-
ditions Both Here and
Abroad, Giving Trade and
Manufacturing Data

LOS ANGELES. Oct. 4.--There is
nothing in either the domestic OF
foreign situation to give rise to the
pessinlistic conclusion that the world
is riding straight to ruin! John s.
Drum. banker, of San Francisco, told
the American Bankers association,
Of which he is president. at the open
ing session here today Of It's forty
seventh annual convention.
Rational examination Of our con-
dition today" he said, must prove
to the greatest doubter that our prob
lens are but the natural manifesto
tions Of worldwide maladjustment
that great natural forces are work
ing to remedy"
bankers provided the basis for his
subject, he said.
1.-The output Of finished goods
throughout the country is consider
ably smaller than q year ago, and
measurably smaller than six months
ago." Mr.. Drum said There is a
surplus Of manufactured commodi-
progressive decline in the cost OF
manufacturing has taken place dur
ing the year. In industry, as a whole,
the costs of materials. labor and con-
struction have declined, in the order
named Increased efficiency of labor
has been the natural result of unem-
ployment on a large scale but the
efficiency Of men in the building
trades as a whole has not increased.
Taxation in Industrial sections has
either increased or remained station
airy during the year; in no case is a
decrease reported. Wholesale prices
of manufactured goods have decreas-
ed steadily through the year. Retail
prices, on the whole, also have de-
clined steadily. although not in the
same proportion as wholesale prices.
Farm Conditions
I'm the great cotton states Of the
south, in the agricultural safes of
the middle west apd the west, in the
western mining and cattle raising
states, in the lumber producing regions
Of the northwest and the southeast,
buying power, consequently a slacken-
ed demand for natural products and
, reduction in their value without a
commensurate decrease N the prices
Of finished goods.
In the Industrial regions there
has been a reduction of production,
consequent upon reduced foreign pur-
CHASING and reduced buying by pro-
ducers of natural products at home.
featured goods in industrial centers
has thrown millions of men out of
employment and consequently has op-
Grated TO reduce further the national
buying power.
eff world influences in the process
OF readjustment could be divorced
from domestic influences, this coun-
try would not now be considering
problems of readjustments; it would
have solved them and would be walk
ing in the old path. But this could
not and cannot be; world influences
now and henceforth must have a
powerful bearing even on the prob
lens that in former years were con-
sidered purely domestic.
1.-THE reports l have received also
have shown that the three great do
nestle influences that more than all
Others are retarding the readjustment
of prices and costs are these:
Price Obstacles
First: Delayed adjustment Of cost
of labor, which prevents adequate re-
duction of prices of innumerable conf
modities and services in the cost OF
which the cost of labor Is the most
important factor, and also serves to
prevent full employment of labor.
This is due both to slow adjustment
of compensation of labor and to the
continuation Of shop rules that i'm
pair it's efficiency.
Second: Sustained high costs of
transportation, which prevent natural
and normal movement of conamodi-
ties of all kinds to markets.
Third: Continuation of an I'M
sound system of taxation that di-
verts working capital from it's prop
er channels and thereby prevents ac-
emulation of working capital that
is necessary for increased produc-
ton, for Installation of improved
methods of production and for full
employment of labor.
Common opinion, expressed in hun
dreds of reports that make UP this
survey is that when these three de-
terrent influences have been eliminat-
ed the chief obstacle to a restora-
ton of a proper and equitable price
equilibrium will have been removed,
trading between one group of pro-
ducers and others will proceed ma
turally, and labor and capital will be
more fully. employed in productive
entarnrfSeS"