The Washington herald., 1921-05-29
tBx WALTER b. BRowN)
Editor New York ConnereiaI.

EaftoR view herk touAncrcAAas
NEW YORK. May 2s.-Nothins
much has happened from the stock
market standpoint Prices have
moved upward and downward in ac-
cordance with the pressure Of pro-
fessional operations but without any
other particular Significance. At
tempts to ut political developments
to price movements have failed. be-
cause while apparently moving In
sympathy with them at one time o
change In these developments ap-
parently had no effect.
Developments during the week
continued to lean to the constructive
side. The European situation, Is of
course the key to the worlds econ
omic problem. Secretary Mellon
stated on Thursday that while there
was no doubt that the business sit
uation was improving. no business
boom could be expected until Eu-
'ropean conditions had improved. This
factor is thoroughly realized in ad-
ministration circles and President
Harding has taken the matter up in
serious way. On Thursday the
President had as his guests at din
ner at the White house a number of
prominent New York bankers. the
chief topic of discussion being loans
to foreign governments to be pri-
vately financed in this country, and
the manner in which such loans can
be used to help the revival of Ameri-
can export trade. The administra-
tion has previously made known its
desires that the proceeds of such
loans shall be used here. At this
particular dinner the part that the
United States can play in the re-
habilitation of Europe was discussed
at length. Other meetings are to
be held from time to time and II is
evident that the administration is
trying to obtain definite results now,
that the way Is open through the
settlement OF the German repara-
tions program.
President Reassures Busine.s.
The President has done more to
reassure American business in tn.
past week than has been done any
time since the war.
Al the banquet given in honor
OF the 125th anniversary Of the
founding of the New York Com
mercial and which was attended
by 1900 of the foremost business
men OF America, the President
gave to American business the
fullest assurance Of the govern
ments desire to cooperate with
business He promised the least
possible Interference of govern
ment in business and declared that
hereafter big business should not
come under suspicion merely be-
cause IL was big. There has been
some tendency" the President
said TO regard business<,as dis
honest until it shall prove itself
honest and to regard bigness In
business as a crime. But all busi-
ness today is conducted on a scale
whleh, though we have come TO
regard it as commonplace. wouIo
nave made our forefathers gasp,
and I prefer to assume that Amer
lean business is honest until IL IL
proved dishonest. II they had at
tempted to limit business in size
and scope in the beginning, they
would have prevented even the lit
tie business today from being as
great as ii is"
Much interest was taken In IN.
residents remarks on that occa-
SION regarding the desire on the
part OF the government to transfer
the allied debt from the govern
ment directly to the people, This
Is something for the future. how
ever. as the administration has no
immediate intention of working
out any scheme by which the al
lied securities would be used to
take up liberty bonds upon their
maturity. Secretary Mellon, COM
mentfng on this, stated that the
President merely expressed a hone
that some day a scheme would be
feasible under which the allied Sc
curties could be placed in the
sands of American investors, thus
establishing a direct obligation be-
tween the foreign governments and
the holders of these securities IN
stead of continuing the present
system by which the United StateS
government holds the obligations
of the foreign governments, Amer
lean investors to hold bonds based
on these loans
So far as domestic business Is
concerned, industrial recovery is
proceeding slowly, but there are
bound to be wavy lines In the up-
ward course, and not the general
steady advance which many have
hoped for. The transportation sit
uation Is the most complex. Wage
reductions will amount to 10 or Is
per cent. but Senator cummins,
chairman of the Interstate COM
merce committee, saws that there
can be no reduction in freight rates
L. - T.
operating costs. presumably more
than can be accomplished by this
reduction In wages The only other
alternative would be for the gov
eminent to dip down into the treas
ury to make up deficits, which
would in effect be directly subsidiz-
ing the railroads. The problem of
reducing these costs is being gradu-
ally worked out, and In the course
or time solution will be found.
General Leveling Necessary.
Judge Gary, speaking at the
American Iron and Steel institute.
declared there must be a general
leVeling of labor costs, living ex-
penses. selling prices and particu-
iarly transportation costs before the
steel Industry will emerge from the
present serious depression. Charles
NJ Schwab and others all agreed on
this point. although there was an
undercurrent of optimism In all that
was said. 1t means, Of course, that
recovery In steel will be slow, which
is what Is expected by those who
nave made study of the situation.
Steel activity follows the growth
and expansion Of general btJsfness
and that has some distance sto 20
yet. President woodin,5 of the
American Car and Foundry COM