New-York tribune., 1921-02-05
Sound Structure
For Trade Near,
Says Alexander
Way Lies i'm Wide Reduc-
tion of Prices, Based ON
Higher Efficiency. He Tells
Exchange Firms Diners

Great business forces are at work
building sound business structure for
1921, according to James S. Alexander.
president of the National Bank of
Commerce, who at dinner Of tho AS
sociation Of Stock Exchange firms in
the Hotel Astor last night, declared
that America does not need boom
period to be prosperous. He said that
supply and prices are becoming broadly
coordinated to demand, but pointed out
that PROCESS toward liquidating credits
must be carried further
"The beginning OF the year 1921 has
auspicious aspects in the rapid yet
orderly way these great corrections are
progressing" said Mr.. Alexander. "The
year must be Judged, then not 80 much
by the volume of business that will be
accomplished in 1t, but rather by the
sounder conditions which will prevail
marking the definite retu1 to new
era of business fundamentals.
Normal activity must come from
within business rather than from with
cut. Business cannot idly wait for the
public TO resume buyrK. 1t must stimu-
late buying by establishing wide prev
alence of substantially reduced prices
for goods, which must be based on in
creased efficiency in production and
distribution, and the acceptance of
reasonable margins of profits"
Mr.. Alexander called attention to the
growing tendency of labor to become
more efficient and it's willingness to
accept some liquidation of wages, and
asserted that employers should not at
tempt to lower wages unduly or to en-
force greater curtailment than the cir
cumstances warranted.
William II. Remick, president OF t. O
Stock Exchange made q plea for
greater public recognition Of the fune-
tions of the exchange and declared
that the past year had demonstrated
more than ever before the Iiquidity Of
loans based on security collateral.
"A corporation, one of the oldest ir
its line of business. noted for the ron
servative ii not ultra-conservativu
conduct of its affairs" he said, "sud-
financial position, due to the inflated
prices Of normal inventory for con-
stantly increasing volume of business
THE borrowings in the form of COM
naereial paper at the banks, which were
rediscounted with the Federal Reserve
institutions, became excessive in rela-
tion to it's capitalization. 1t therefore
turned TO Wall and La Sale streets
for reinancing. A plan was adopted
which gave 80 the organization large.
working capital through the sale
to the public Of its securities Of
permanent character, and enabled theh
to pay large percentage Of their
quick liabilities and thus relieve the
FEDERAL Reserve institutions.
"The Federal Reserve act, however
denies to the finahciers, VIII, afforded
them q maximum of relief, ev.n min
imum of assistance. Why should tn
plain unsecured promise to pay of 8
corporation be more acceptable at the
Federal Reserve Bank than a note of G
firm of undou5ted credit secured by the
same organizations obligation, pledged
at 70 to rs per cent of its face value p
Answering those critics oe the ex.
change who have called It gambling
institution, Mr. Remick said there il
no other market in the world which
benefits all classes SD much az the
Stock Exchange.
c. A. Morse, president of the Asso-
citation of Stock Exchange Firms, pre-.
sided at, the dinner.
The association elected TIE following
officers for the new year: President
Andrew j. Miller; vice-president, Ar,
thur Myles; treasurer, Jules Bache.
The following were elected to the
Bernon S. Prentice, Henry Rogers
Winthrop, G. R. Dyer and Samuel F
STREET. Mr. STREET, who is also bresi
dent of the Stock Exchange Clearing
house corporation, in an address tt
the members stated that after February
LIS Liberty bonds will be added to the
LIST of sprrritjes c1esrad