Great Falls tribune. [volume] (Great Falls, Mont.) 1921-current, 1922-06-11
Weekly Financial Review
BY STUART P. WEST

Copyright. 1929. BY The Great Falls Tribune.
New York, June 10.-There were
four salient incidents in the financial
situation during the past week. Call
money rates dropped to the lowest
| point in over four years. Weakness
developed in the continental exchanges
owing to the seeming failure of the
bankers gathering at Paris to sur
mount obstacles in the way of an in
ternational loan to Germany. There
was an extraordinary advance in cot
ton prices beyond all high levels of the
last two years and more favorable con-
ditions developed in the sugar trade
than had prevailed since the disastrous
slump started in the autumn of 1920.
The Call Money Market
It is note worthy that the three per
cent call money market has come on
the heels of the publication of esti-
mates of Wall Street loans, placing
their total at something like $780,
100000 as against only $5OO,OOO,OOO a
year ago and comparing with a maxi
mum of S1,75O.O0O at the top of the
speculative boom of 1919. These fig
ures are quite unofficial. but they are
accepted as dependable.
Paying Debts and Adding Gold
1t is striking fact that Wall Street
operations involving the use of credit
should have expanded to within mea-
surable distance of the inflated times
of three years ago, while money rates
should have continued to fall. The ex-
PLANTATION is two fold. On the one
hand, as the continued decrease week
by week in the federal reserve redis-
counts shows, the agriculture and
manufacturing communities are paying
off more old money than they are Dor
rowing new. On the other hand, there
is the huge addition to the counfry's
gold supply, the basis of credit re-
cources-amounting to nearly $1,000
100000 since the beginning of 1870
and to nearly $4,000, 100000 since
1915.
Politics Outweigh Economic Needs
The banking representatives confer
ring at Paris have had a chance to OBJ
serve at first hand that political con-
~siderations outweigh economic on
siderations in the ~counsels of Contin-
entail Europe. France especially has
refused to yield at all in the repara.
tons program, ever where the united
sentiment of all the allies has aligned
itself with the best financial judge
ment of the world that German indem-
nifty payments must be modified il a
loan is to be put through, and that
without such loan there can be no
solution of the problem of European
reconstruction.
High Cotton Prices
Cotton prices have now reached a
level fully one cent "a pound above
the high of last autumn, when the cot
ton trade was working upon the sen
s%ational disclosure of shortage in the
governments October report. The
estimate. 100000 bales as the total
of the 1921 crop, was completely falsi-
fled in the end. The actual yield was
approximately 5000 900 bales. But
the astonishing thing is that ~calcula-
tons of demand and supply should
have absorbed this large addition to
last years crop as it appeared in Octo-
Der, 1921. and should have fixed a. the
proper selling basis upon prices actual
ly higher than those of eight months
ago.
To justify this it must be shown
either that consumption has increased
or that supplies actual and prospective
have considerably decreased. As a
matter of fact, consumption require
IHeHlS nave Dctn icstiiceeu uuIiis thc
last six months by strikes at the New
England mills and while exports of
cotton have increased, it is not ex-
pected that world supplies will get
down to normal before midsummer.
This leaves the recent advance in
prices entirely dependent pom the
damage to the growing crop from the
rainfall of the last few weeks. Under
these circumstances an Improvement
in weather conditions could scarcely