Indiana daily times. [volume] (Indianapolis [Ind.]) 1914-1922, 1921-06-10
BANKERS STUDY
ECONOMIC AND
MONEY STATUS
Business Conditions of COun-
try Reflected in Replies
to Queries.
OPTIMISM IS CONVEYED

at does not lie within our power as
individuals, nor that Of the American
Bankers Association as a group Of indt-
viduals. to halt the memorable economic
forces that are at work in this country
and in the world We can, however,
look upon things as they are and base
our acts upon things as they are, and
By doing so we can to some extent d.
rect the operation of these forces" says
the introduction to an economic survey
by the American Bankers Association,
reported to the executive council of the
association at Pinehurst North Carolina,
by John S. Drum, president.
The economic survey, which is Of
April. 1921, is on bu.lness conditions in
the United States. and the chart, which
accompanies the written report, was pre-
pared by the association from complIa-
ton of more than one thousand replies
to a questionnaire submitted by the
association to members of its executive
council and TO other leading bankers
and business men in every State in the
United States.
The material presented in the chart
represents a compilation of the opinion
Of those who replied to the questiOnnaires
submitted and does not necessarily. it is
explained, represent the views OF the
association.
ECONOMIC PROBLEM
OUTLINE GIVEN.
"A careful analysis of the replies to
the QUESTIONABLE gives the following out
line Of the economic problems that con-
front the United States, as expressed in
III eterms Of the problems Of production"
II is explained on the chart:
Il. Cost a. Labor; b., materials; c.
transportation; d. money; e. taxation.
, Domestic markets. a. Decreased pur-
chasing power; b. the buyers strike;
C. disinclination of retailers to take
losses; d. cancellation Of orders. g. For
eign markets. a. Decreased purchasing
power in Europe: b. inadequacy of pres
ent credit facilities; c. political disor
gsnization in Europe; d. the exchange
situation"
Following is a digest Of the informa-
ton contained in the chart, including the
questions asked, the first six questions
being under the general head of financial,
the next fifteen under the head Of COM
mercial, the next four under the head
of Industrial, the next three under the
head OF agricultural and the last two
under the head OF building:
OPINION FAvORS EXCESS
PROFITS TAX REPEAL.
L Ais sentiment in favor Of or op-
posed to the repeal of the excess profits
tax? A-Senti7aent virtually unanimous
in favor of repeal; B-What substitute
is suggested? B-Answers fall into two
classes; 1-ReductiOn of current ex-
penses of government by: (a) economy
in government (b) refunding OF short
term Government bond issues and finding
OF floating indebtedness; .. Substituted
taxes: (al sales tax, (b) increase and
extension Of income tax, (c) fat profits
tax. Cd tariff
?. What is the sentiment with regard
10 the sales tax? A considerable ms
jority reports sentiment in favor of a
sales tax. A number of replies reporting
favorable sentiment are qualified, how
ever In many small communities OppO-
sitiOn to the sales tax and favor Of the
excess profits tax is reported
8. What is the sentiment with respect
70 the cancellation Of the debts of for
eign governments? Great majority op-
posed to cancellation.
4. VIII interest rates rise. fall, or re
main stationary during 1921? Majority
opinion is interest rates will remain sta
tionary.
>. What classes Of corporations find
readiest market for securities? This
varies according to conditions in par
ticular States and sections; some min
ing States, for instance, report a ready
market for mining securities. In gen
eral, however. the survey shows securi-
ties find favor in the following order:
Industrials, public utilities. tax-exempt
bonds of municipalities, etc, and rail
way securities.
CREDITS VITALITY AFFECT
L. S. FOREIGN TRADE.
.
eisiOn Of the Supreme Court holding le-
gal farm loan bonds relieve the credit
situation! Common opinion is that some,
although not a very great. measure of
immediate relief may be expected.
7. Is the situation with respect to can
collation. of contracts because of falling
prices seriousl Very serious in indus
trial State, although less serious than in
the fan and winter of 1920.
S. Are manufacturers and exporters re-
laxing their efforts TO sell goods In for
eign countries? Majority opinion Is that
while manufacturers and exporters or
dinarily would be increasing their eff
forts to sell goods abroad, because Of the
contraction Of domestic markets, they are
relaxing their efforts because of uncer-
tainty Of payment, difficulty of arranging
credits and unwillingness Of foreign pur-
NAdccAo 10 PuAtAdSE uHutL tA4sLluE "a
change conditions
9. Have any considerable quantities OF
excess manufactured goods accumulated
In storage? Reports indicate surplus
in virtually all parts of the country.
10. What factors, in your opinion. are
working toward a sterilization of prices?
Operation of the law of supply and de-
mand as manifested by: (a) gradual
liquidation of commodities purchased at
high prices, on the basis replacement
costs; (b) return of competitive con-
ditions to business and labor; (cl the
buyers strike insofar as it has elimi-
mated extravaganza in buying; (dl
willingness OF labor in some lines TO
accept wage reductions in line with
general readjustment; (e) increased
efficiency Of labor; 81 efforts to re-
habilitate foreign trade.
SEVERAL FACTORS WORK AGAINST
PRICE FERTILIZATION.
II. What factors are working against
sterilization OF prices? Opinion is chief
factors are as follows: (a) attempts OF
many sellers to resist adjustment, in the
hope that prices will advance by re-
fusing to take losses and sell on basis OF
replacement cost; (bl unwiliingness of
labor in many lines, to accept wage re-
auctions in conformity with general re-
adjustment Of prices; tc) the buyers
strike" insofar as it impels consumers to
postpone normal purchases in the hope
that prices will fall still farther; td)
Inability OF European countries in need
Of American raw materials and manu-
fectured goods to purchase supplies be-