Evening star., 1923-07-14
Reporations Tangle and Home
Trade Chief Market Factors
Financial World sA,Uaits Outcome of
Baldwin Speech--Part of Domestic
Showdown Is Seasonal.

rations adequate to meet the deficit
In the French budget would vanish.
Exadiy how would a German
breakdown, with it's attendant conse-
quences for the rest of Europe, react
upon conditions here? We have seen
that while our own trade movement
has been hampered by the delay in
European reconstruction, our foreign
commerce has by no means been
swept away, as the pessimiSts pre-
dicted in the summer of 1921. We
are a heavy creditor and therefore
European crisis would not threaten.
as ten years ago, a vast recall of
foreign capital invested in American
enterprise. The only other way we
could be hurt would be through loss
of foreign trade. Out of total of
$319, 100000 exports from this coun-
try in May, only $23. 100000, or 7.25
per cent, went to Germany, and only
$4,000, 900, or 6.25 per cent, to France.
Sixty per cent was outside of Europe
altogether.
Nobody supposes that, whatever
happens. We would lose our entire
commerce with Germany and France,
but II we did, it would mean a loss
of 13.5 per cent. and even with this
deduction, our export trade would be
far above prewar years. To Judge the
margin which we have today. II
should he noted that whereas in 1912
and again in 1913 exports were less
than $4,000. 100000. they now are run
ming at the rate of some $500, 900, 900
per annum.
Lull in Business at Home.
Returning to home affairs. there
has been perceptfble showdown in
business since the middle of last
month. To some extent this is merely
the ordinary midsummer lull APP
parently also the Wall street hap
penings and the decline in commodity
DrIreS HCnarIallV anf drnV
during the last fortnight in the price
of wheat, have made business men
very cautious about forward buying.
The pessimistic propaganda has tried
period of depression. Nothing that
has occurred thus far warrants such q
conclusion. Business expansion was
setting altogether too fast a pace in
February and March. There was
bound to be a falling off in new or.
ders as soon as the depleted stocks
of merchandise. as these stood at the
first Of the year, had been brought
back to normal.
Wheat Growers Unfortunate.
The unfortunate position Of the
wheat grower is the most unfavora-
bic feature of the situation. 1t is
striking instance of where. govern
mental measures of relief have not
! only failed but have made things
worse by far than If they had not
, Deeh tried. the farmers, relying upon
special credit extensions to help
them hold their wheat, planted an
acreage altogether excessive in rela-
tion to world demand and supply
Now it turns out that with a heavy
carry over from last year. with a new
crop well above the average, the
wheat growers have to face the com
petition of an unusually large Cana
dian output, considerably larger
yields from India and Europe, and all
this with a subnormal European buy
ing power.
The Improbable level of whea,
prices must be taken into account
for it's effect upon next seasons buy
ing power in the industrial markets.
But against this it must be remem-
bered that wheat is a special case.
! Cotton prices are far above the aver
| age. and corn is high, the latter in
| dollars being a much more valuable
crop than wheat.