The Birmingham age-herald., 1921-05-10
Daily Financial Gossip
By HOLLAND

By HU
 New York, May 9--(special)- Charles M. schwab, Henry II. schwarz and others who have recently visited Germany have spoken since their re- turn to the United States of the indus trial activity which seems to them to have permeated the German wage earn CTS. They have also spoken in words of warning of the danger which German competition is now establishing with certain commodities in the markets of the world and particularly our own do- mestic markets. These are facts which have been gathered by men competent to make observation. It remained. however, for the Secretary of Com merce, MT. Hoover, to explain why it IS possible for German industry to gain such efficiency and secure such low cost of production as to enable the Ger mans to market steel in England at a price far below that which English steel manufacturers must ask, and why Germany is putting pneumatic tools in the automobile manufacturing centers of the United States in successful com petition with the American ma,nufac- turers of these articles
 MT. Hoover does not disagree with Mir. Schwab and the others so far as that these facts have been accurately thatm these facts have been accurately stated, but he does more than Mir. Schwab and the others have done. They referred to the low wages, to the effi- ciency, to the spirit of sacrifice, and to the practice of economy which now characterize the German workingmen. l. s.f mony before the ways and means com mittee of the House of Representatives he stated that the department of com merce has already investigated the cost of production in Germany and has disc covered why this cost has been reduced to such an extent as to make it possible for German industry already to under sell other nations with some of their products.
 The German government, Mir Hoover has discovered, is substituting produc- tion of all kinds and is maintaining fic1 titious low prices by currency infla- tion. He estimates that about S0,0OO,- 100000 marks are in this subsidy, so that the government is really paying much of the losses in all lines of in- dustry.
 IT CANNOT BE CONTINUED
 This is policy which, in Mir. HooverS view, cannot be long continued without causing complete collapse of the finan- cial structure of Germany The inter ence is reasona ble that Mir. Hoover be- lieves that this artificial, arbitrary and expensive policy which Germany has adopted may for time enable the products of German industry to com mand outside markets. but this cannot be continued for a long time. There fr~a ind reaSOnA- bly count upon some collapse in the in- dustrial methods which Germany now has adopted, and if this view be cor rect, then in the course of time our own industries need have no fear of German. competition.
 It is characteristic of MT. Hoover that he is always able to suggest remedies for industrial commercial or financlai troubles. He did not vary from that n his testimony before the ways ana means committee. The remedy which he proposes refers to our custom houses. He would have commodities which are received from other countries valued according to American stand ards and when valuation of this kino is made then there will follow duties which will be to a great extent pro tective.
 MT. Hoover's testimony was fortu- nately given at time when some anxiety has been created lest German industries be able to produce commodi- ties which would be successfully com petitiye in our own markets and would prevent the sale of American commodi ties in our countries where we have al ready secured excellent markets For if the German policy of snbsidizing in- dustry Is faulty and will soon collapse and if there be American valuation placed upon commodities exported to the United States from Germany. then there need be no further cause Tor ap- lest Germany gain an eco homie and trade triumph, although she was defeated in the war.
 HOLD DIRECTORS RESPONSIBLE
 The modern tendency in our courts IS setting strongly toward the holding or directors and especially non-active di- rectors, responsible for losses or TOT the bankruptcies of corporations with which directors have been associated. It was this tendency undoubtedly which led some of the directors of the New Haven Railroad company to make agreement to pay large sum of money rather than to defend suits which were brought against them by stockholders in this company. It is the understand ing here that the stockholders in Tar