The watchman and southron. [volume] (Sumter, S.C.) 1881-1930, 1922-01-04
Banking Position.

Banking Position
The last twelve months have Wit
messed great progress toward stable
fnancIal conditions in business.
Combined gold reserves Of the
.weWe federal reserve banks have
increased hy more than 20 per cent,
while discounts for member banks
isayc dropped Sc per cent. and fed
srad reserve notes in actual circula-
tioa, have declined rs per cent. The
federal reserve system once more
proves TO be a system designed to
sare Tor increases. and decreases
ID the volume OF credit. with the re-
4nis:re elasticity to ao<this easily.
TIE betterG:ent in the position OF
rem Der banks. while not SO
ssI3king, IS never.heiess satisfac-
NotwH Hhstapdlng the consistent
iseprosenaens in financial condi-
ti0ns,5recovery in manufacture and
frade has been slow Cnenlploy-
aaent in the chief countries shows
stle decline from the high point
reached early in the year, and it
ssay veil reach new high figures
Curing January and February,
hen normally there is an increase
II the number of those out of work
ia North America and Eerope.
Manufactured goods continue to
Aoye slowly and Uncertainty into
tie channels of consumption.
: The Raw Material Probicna
In last ANALYSIS. the business of
The world rests on a physical, not a
sGnaneiaI foundation. Failure Of
bsslanee between worldwide supply
Of and effective demand for ply
seal goods forced the violent read
5astment Of the. last two years;
ssadns.nent which VIII not be
complete until this physical balance
has again been established.
The wool situation illustrates
narticslarly we'll the various, fac
tors which have prevented return
TO rmal,eoR6itions. It has con-
1;nued to accumulate, partly be-
eeslse central Europe has no. been
ables to purchase in the expected
anacunts, partly because an import
5:sns part of the wool supply is a by
product. and partly because the
building III, OF focks is so slow a
pgoeesS that hock-masters reduce
Them only when they have given up
hope OF profits.
curtaslment Of production
and Increased demand copper
shocks are showing reduction. The
short American and Egyntian cot
ton cropsshaye served to- bring the
sxesId' cotton supply approximate
TO al prewar normal. Stocks of
hides and skins aye large III many
countries put are moving more
freely into consumption. The prices
of rubber and sugar are stin below
fhe cost OF production. Sisal stocks
carried over from last year now
constitute nearly two-thirds OF a
aesmal gears supply. The worlds
wheat production is in a satisfac
terry state Of balance ia that there
isan adequate supply and a sustain
ed demand The american farm
er, IN the face of q new corn crop
OF s.Is., geo .0e0 bushels. is carry
ing over 281.000,c Geo bushels from
the record crop Of 1920. There is
Also an accumulation in other less
peH-known commodities.
This accumulation OF physical
goods is. not {, misfortune. 1t as
sures to the world supply of cheap
food and clothing. and real pros
perity has never rested on any 9TH
er basis But producers of raw ma
1eriaES constitute mich more than
half OF the buying power CT the
world and the conclusion IS in
eFisaBle that the entire economic
ssFucelre Will gradually adjust it
self 10 the raw material market.
pisarzsament and The Economic
Outlook.
Yke essential step toward recov-
cry issrenloval OF the burden Of ex-
pendftures for war. The countries
which are wasting their money and
effort on armaments are those
whose markets must absorb the
worlds excess Of raw materials.
and pay for it with manufactures.
The. terrific burden of war debts
-f,.