The Birmingham age-herald., 1921-09-12

Editor Commerce and Finance, New York ICopyright, Theodore H. Price, Publishing Corporation, 16 Exchange Place, New York;.
 Happily there is a short crop of cotton this year. says Secretary Hoover. and although all economists know that he states a paradox nearly every one will agree with him, for King Cotton. temporarily dethroned, has again regained his sceptre and under his leadership business is marching cheerfully toward pros perity.
 The fact that a curtailment in the supply of one of the worlds most necessary staples could work such a transformation in public sentiment is proof that conditions were sound and that all that was needed to ,re- awaken constructive energy was some development that could be fla vorably constructed. In reality crop failure like a conflagration means & reduction in the worlds wealth. but the San Francisco fire proved to be a blessing in disguise because it stirred men to action and provided work for everyone.
 For a slightly different reason the cotton shortage promises to have the same effect. It has revived the spirit of adventure without which progress 3s impossible. In time of course this spirit will make some people the vic tims of their own enthusiasm, but that time is still distant and mean while it is only necessary to note that in nearly all the markets the light of & better demand is to be seen.
 This is conspicuously true of wheat. which has advanced sharply. The reason assigned is that we have al ready shipped a third of our ex- portable surplus, estimated at 160,- 100000 bushels, but the truth is that people have become courageous enough to anticipate the future.
 The same thing is true of steel
 and iron. There is more buying
 and production is being corre-
 spondingly increased. The in-
 crease, though slight ms yet,
 promises to he cumulative. Cop
 per Is also higher. So are build
 ing materials. Lath nnd lumber,
 cement and brick and glass and
 plaster are all being more free
 ly bought. There is also a better
 demand for gasoline and tires, s nnd the automobile people seem
 more cheerful although many of
 them are following FOrd's lend in
 reducing prices. Hides and leather
 
 sales in London and Australia an
 eager demand at advance of
 from 10 to 15 per cent is reported
 and a large carpet auction in New
 York was great success. In
 cotton textiles business has been
 halted somewhat by the violent
 advance in the raw material, but
 1t seems probable that cotton as
 well as its manufactured prod-
 rts xrfII hecOme
 ixed on a basis of about 20 cents
 for the former. The farmers seem
 disposed to sell at that figure,
 and while no cotton famine is
 possible this season the producer
 is in command and cannot be ex-
 pected to forgo his hard won ad-
 vantage.
 Railroad Traffic Gains
 Railroad traffic continues to gain. The net revenne for July promises to exceed S75,OO0,000 and August earnings may Nbe still larger. It is suggested that by selling the $SS0.- O00,000 of equipment trust certifi- cates it owns the government may De able to advance that sum to the roads without congressional action and the executives show repressed cheer- fulness at the prospect.
 The statement of the federal re- serve banks shows a further gain or Si5,00O, 900 in the gold supply, but this is at last commencing to have some effect upon loans and circula- tions, which show an aggregate in- crease of e0,o00,000, with the result that the reserve ratio has fallen from 66S to 66.2 per cent The money mar ket is easier at 51a per cent for time loans and 5% per cent for commercial paper.
 The stock and bond markets as 8 whole have been firm and higher. The stocks of railways which trav- erse the cotton states and of the companies that sell fertilizers have been helped by the advance in cot ton, and the securities that smell of Mexican oil are also higher upon the belief that the oil magnates now re- turning from Mexico City have ar ranged modus vivendi with Obre- gon. Meantime Judge Gary of the Steel Corporation, not to be outdone by his fellow captains of industry. is on his way to the Mexican capital, and there are some who expect that our government will recognize Pres ident Obregon now that the great corporations have condescended to call upon him. At all events, Mexican bonds are higher, and in Wall street it is believed that the ticker talks"
 Pessimists Become Cheerful
 Noting all these evidences of the improvement, I have so long predicted even the pessimists are becoming cheerful, and a veritable chorus of optimism is to be heard from coast 10 coast and from the Rio Grande to the great lakes. By his letter to Sem ator Mccormick recounting the achievements of his administration and describing the many good things vet to come. President Harding has made himself the leader of this chorus, while the tenor of Will Hoys is to be heard as he sings that every one knows that there is ahead the greatest era of expansion and pros- perity the world has ever seen."
 A building boom Is reported from Chicago Bradstreets and Duns agree that business is improving. The chief statistician of the American Tele- phone company says that the trade passing is so per cent of normal, and that 'it is becoming plain that de-