Evening star., 1924-04-12
BY STUART p. WEST.

Special Dispatch to The Star.
NEW YORK, April 12-The quick
acceptance of the Dawes committee
report on German reparations by the
allied representa- tives should prop
erly be regarded as the event of first
Importance in the financial situation
of the last week, For five years eco
nomic writer's have been saying that
the German collapse was the worst
feature in the world outlook and that
German reconstruction would be the
greatest accomplishment from the
standpoint of the general business
good.
Now the recommendations of these
experts have been adopted by the
reparations commission unanimously.
They constitute the best solution by
far of the problems growing out of
the war. The relief is that with the
other nations SO united and so prompt
to render their decision, Germany will
agree. There has not been moment
where the chances for a solution of
European difficulties have looked as
bright as they do at present.
why Markets Have Not Responded.
The markets, however, have not
taken the news with any great de-
gree of enthusiasm, for the simple
reason that they realize that even
with the Dawes plan going through,
is long ways off. Germany is the
most important customer of the
American cotton and copper trades.
1T means great deal for these in
to be restored to normal. But how
long, with the tremendous handicaps
of increased taxation provided for
under the Dawes program, is 1t going
to take for the Germans to regain
their old-time purchasing capacity
abroad?
This is one of the questions which
arise in q practical discussion of
what the actual achievements of the
investigating committees signify for
the present market. The reason why
the markets have not enthused more
is not because they have been skepti-
cal about Germany accepting, or
certainly not because they have min
imized the Importance of effecting an
economic settlement in Europe. They
have only felt that the prospective
recovery was something too remote
to be regarded as a matter of first
consequence. -
business Home Less Encouraging.
The thing of Immediate concern
is the business situation at home, For
been accurTlulatfng that expansion,
as it was pro eding at the beginning
of the year was going ahead over
fast Too much optimism was ex-
pressed about the outlook In indus
trial lines. Too much confidence was
The stock market of January, re-
fiecting this attitude went to excess
on the side of advance. Important
industries like steel and automobiles
increased their output extravagantly.
Now il has been disclosed that
,, ,fye ~ hric
seemed three months ago. Consumers
have persisted in their policy of buy
ing for immediate requirements
merely. The result has been an. ac-
oumulation of a surplus on the harfds
of producers, re1ulting first in in
creasing competition at declining
prices and, second, in a curtailment
of output. This is what is going on
in the steel trade. in the motor in
dustry and in other representative
lines. 1t has already begun to show
in the general buedneSs data, espe-
cially in the figures on railway car
loadings and bank clearfngs.
Change In Political Situation.
At the same time political affairs
have undergone a change. At the start
of the year, nine-tenths of Wall
street was sure that conserva-
tive candidate on a conservative
platform would win next Novem-
what this would mean for gen.
eral business and for the markets.
Now. after what has been happening
at Washington in the last two months,
the feeling is quite different. 1t can
not yet be said that the recent de-
cline in the stock market reflects
serious uneasiness as to the possibility
of radical success at the polls. But 1t
can be said that one of the reasons
why prices have sunk to the lowest of
the year, losing the better part of
the entire gain since October, is that
influential interests in Wall street
regard the presidential campaign with
uncertainty instead of with the COM
placency they formerly felt.
The downward movement is, there
fore, quite Ineligible on the double