The Birmingham age-herald., 1921-01-31
By THEODoRE H. PRICE. tEdttor Cemmexce and Ffnance.) }

tSopyrlght Theodore H. Price Publish
 ing Corporation.)
 New York. January T.-(Special.)- The most important development of the week is the continued rise in foreign exchange. Sterling and francs have shown the greatest strength, but bills on all European countries have been in better demand and even Austrian crowns have advansced to three tenths of cent each as against the negligible fifth of a cent at which they were for merly selling. Measured in percentage this is gain of 50 per cent
 There are two reasons for the im- provement One is the successful flo- tation of the Belgian loan for $30,0O0- 900 and the belief that it presages the opening of similar credits here for other European countries. The second reason is the confidence that the French seem to have that they will succeed in persuading the supreme council of the allies now in session at Paris to inn pose an indemnity of 200, ,0O0 000, 900 gold marks upon Germany. As France claims that she is entitled to 55 per cent of this sum. which would be equal to about s27,000, 100000 in gold or its equivalent in goods, it is evident that her financial position would be greatly improved if her views prevail. Optim- istic speeulators in Paris have there- fore bought francs freely and sold dol lars" and their operations have been promptly reflected in the New York market for foreign exchange. Concur rently. several French economists hav- ing visited Germany are reporting that she is very prosperous and abundantly able to pay the sum demanded, thereby persuading many that conditions throughout Europe are not as bad as was supposed.
 The supreme council has not, how ever, reached any conclusion as yet. There is strenuous opposition to the demands the French are making and the whole question is likely to remain in the air for some time. Meantime the uncertainty is breeding a worldwide gamble in foreign money and exchange that centers in Paris, but has extended itslef to the small towns and even the farms in this country. The newspa- pers recently reported the arrest of a man who had been selling counterfeit German marks in the middle west. and 1t is rumored that among the Irish in the United States there is more or less speculation in the recently issued bonds of the Irish republic. I allude to the subject al some length in the hope that word of caution will prevent the un- wary from being caught in the traps that are being laid for them by the many swindlers who promise large profits on small investment.
 BENEFIT TRADE
 Higher prices and a steady market Tor foreign exchange will greatly ben- eft our trade, but it is to be feared that the printing presses in some Flu ropean countries will continue to turn out paper currency as long as their product can be sold for more than the cost of production,
 In the United States trade reports and predictions are encouraging, but speculation is lethargic. Despite the continued gain in the reserve ratio of the federal reserve system, the money market is slightly firmer. reflecting probably the absorption of the credit released by merchandise liquidation in the foreign and domestic bond issues now advertised daily. The Belgian loan oversubscribed an issue of $30,0OO, GOO ponus offered by the American Agri- cultural corporation on. basis to yield "A per cent was promptly sold, many smaller loans are being successfully placed and the Pennsylvania railroad has sold $60.000,000 of it's bonds to . bankers syndicate that will shortly off, fer them publicly. Advance subscrip- tons to the offering are sadi to aggre- gate more than s36O.000,000, or six times the amount of the issue.
 It is also reported that Henry Ford or the Ford Motor company is negotiat- Ing With some New York and Boston bankers for loan of from $60,O0 900 ! to $1a.000,000. but this has been denied. 1 There is but little doubt however, that Ford loan properly safeguarded could 1 De easily placed although there are 1 some who think that the anti-Semitic utterances recently appearing in the 1 Dearborn Independent would restrict the demand for it.
 The very large demand for good in- n1 ar iald df,,~~ 1 cent Is in fact one of the most impress sive features of the situation It is | partially explained by the extraordi- | nary increase of depositors and depos- l It's reported by the savings banks and the life insurance returns, which show that the business of 1920 was the largest on record. Apparently. the 1 American people were not and are not | as thriftless as has been asserted and | as confidence returns there is revealed | an investment capacity that is surpr,s- ing.
 The stock market has been in the | doldrums, so following precedent which leads us to expect a halt after the first recovery from acute depression. Prece- uent also leads us to expect a revival of | speculative activity as the demand for bonds at present in evidence advances them to basis which makes stocks | more attractive
 lhough they have not been weak, the rahroad shares have been slightly aI- | lected by the reduction In freight traf- | TIC reported and the lidleness of nearly f u0cn freight cars. It is however able that the present slump in traItlc is due to the depression whose | most acute stage was reached and | passed two months ago. and that the increase in trade now generally report- eu will shortly be reflected by de- mand for more transportation.
 WORST IS OVER
 In this view many high authoritie. agree. George E. Roberts, vice presi- dent of the National City bank. says that the worst of the industrial de- | pression is over," and Judge Gary of | the Steel corporation confirms him in stating that all that I can see in my connection with industry and especial- " the attitude of workmen leads me r t0 De hopeful He adds. however that | there are some who still impede inc return to prosperity by demandinr more than their goods or services are l. worth. Including in this class the work men who have suddenly become ex. ports and are asking $l to s1.50 an hour Tor their labor and the retailers who l are paying no more than 50 per cent of |! tormer prices at wholesale. while in- ststtng upon as high or even higher h prices for what they sell"
 The federal department of labor ra ports that during the year 1920 fhe l