The Washington times. [volume] (Washington [D.C.]) 1902-1939, 1922-12-04

ohhudl report, al eAtTdcI lTOH
He declares that some time will
be required for complete recovery
from the conditions OF the general
depression, but points out that 4
Distinguishing feature of the slump
was that for the first time a ma or
commodity crisis, which he de-
scribes as the greatest we ever
faced. was passed without financial
panic.
THE outstanding feature Of the
fiscal year July, 1921, to July, 1920
was that 1t marked the low point
In the most violent commodity
slump in our history" MIR. Hoover
said.
THE liquidation and .deflation
precipitated the commercial com
munity into all the losses and un-
employment that flow from such
occasions. 1t was inevitable that We,
In common with the rest of the
world, should readjust ourselves
not only from the inflated levels
Of the war but ALSO from the still
higher levels Of the wasteful post
war boom. During the twelve
months prior to the year under
review both prices and manufactur.
Ing production outside of foodstuffs
fell by. roughly, 40 per cent. and
in consequence some 100000 to
100000 people were unemployed
and business tagnated. The only
marked exception to this ratio OF
decreased activities was the guam
titative volume of foreign trade.
Rapid Recovery.
Our recovery has been marvel
ously rapid, for within sixteen
months following the bottom Of
the slump unemployment was prac-
tically extinguished and production
was proceeding up to between rs
and 95 per cent of our normal. We
have entered into period Of lower
and more stable prices with its
consequent much sounder and more
stable business. The tremendous
shock of the slump together with
the aftermath of the war will re-
quire some time yet for complete
recovery. and speculation is in no
way justified.
The establishments are still un-
equal in price levels between vari-
Gus commodities and between wage
earners and farmers. Nevertheless.
the outlook is SO improved over
year ago as to be scarcely com.
parable.
Credit System.
The most distinguishing feature
OF this slump was that for the
first time a major commodity crisis
the greatest we have ever faced
was passed without financial panic
That our recovery from depression
has been more rapid than ever be-
fore Is to be attributed to the fact
that we were not compelled in relief
from financial panic to repair the
vast destruction from bankruptcy
that has inevitably followed on such
occasions. This fact was in the
main due to the Federal Reserve
stood the severest test that can ever
be applied to II. The measures
taken by the Administration in the
reduction of Government expendi-
lures and taxes. in the handling Of
Government finance, in voluntary
cooperation with many Industries
to meet their special crises. and in
the provision of direct finance to
the agricultural community - all
contributed to a successful outcome
The reduced financial strength Of
Europe, in the diminution of her
ability to purchase our agricultural
produce in advance of her need,
demanded slower marketing and
more credit In some parts Of the
agricultural community. Further
more, the increased mechanization
Of the agricultural industry and its
enlarged productivity per man have
increased its credit necessities.
Under the strain there also de.
veloped the fact that the demand
deposits Of the country, limited in
their use, as they must be to short
credits, can not supply the need
for the 8 to 80 months credits re-
guired In some PARTS OF this in.
dustry or assure the credits needed
IN finance of the farm co-operi.
lives. Some sort of mobilization of
investment capital for agriculture
IL required to supply this need.
which lies midway between those
supplied by the Farm Loan Board
md nv the Federal Raoarx,n Co..