Evening star. [volume] (Washington, D.C.) 1854-1972, 1925-12-31
HOOVER SEES PROSPEROUS YEAR:
URGES CAUTION In SPECULATION
Describe. Whole World as Recovering From Post
War Depression and America as Particularly
Fortunate in Increase Production Capacity.

| the shipping world. aud progress has
been made III plans for internal water
way Improvement. The determination
Of the country has made further great
strides during the year toward central
generation and intcrConneCtion. There
has been some pyramiding of power
holding companies. much criticized
within the electrical industry itself,
but the solid progress Of the industry
is marked by the extension of use OF
electricity with all its economies in
production Of goods and saving OF
labor. Furthermore taking the coun-
try as Il whole, there has been Il re
duction in rates Tor power and light,
tudica ting that the public is securing
benefits from the economies intro
Guced in production of electricity.
''Our foreign trade in .S23 has been
exceptionally satisfactory. Both eN-
ports and imports have risen mate
riauv the former rejecting an in
crease in agricultural exports and the
latter rejecting the large demand Tor
foreign raw materials and tropical
foudStuffs. Exports will total around
81 900. 900 .00u IT about : per cent more
than in 1924 Imports will amount to
about S4,2pU .pOo 400. or approximately
II per cent more than III IVA.
Roughly. one-half OF this increase i'll
able to greater quantities exported,
and the remainder t. advance IN
prices. The major explanation OF our
ia Vora bile trade balance is, OF course,
Ia bc found in the continued heavy
investment of American capital
abroad: in essence. We are lending for
eigners the wherewithall to buy goods
from us, or are sending goods To con
vey our investments abroad. 1t Is
vii
show that this country has added TO
its foreign investments during the
year by more than a billion dollars
The most rerna rka BILE thing about
the foreign trade of the United states
IS that after making allowance Tor
the higher level of prices, both eA-
ports and imports are much greater
than before the war. in contrast with
the quanJita dive decrease in the trade
OF the other foreign countries en-
gagged i'll the war. According 10
British calculations the exports or
that country were in physical volume
nearly IS per cent less in 1928 than
before the war and Germany's exports
have fallen off still more. British
imports are practically at their pre-
war level, and those az Germany
materially below il.
Year of Savings.
In finance the year has been char
scterized by increased savings, COM
para lively easy money conditions, the
issuance of a large volume of both
domestic and foreign securities ana
by an extraordinary rise III the prices
Of stocks, accompanied by marked
speculation on the New York Stock
Exchange.
This fever of speculation Is also
widespread in real estate and unless
our financial policies are guided with
courage and wisdom this speculation
may yet reflect into the commodity
markets, thereby reversing the eau
tiOus buying policies of recent years.
Psychology plays large part III
business movements and over"ptl-
Inisnl can only land rs on the shores
Of oVerdepression. Not since 1870
have we required q better informed
or more capable administration Of
credit facilities than now II We are
to continue all uninterrupted hiEh
plane OF prosperity. In any event,
there should b.. no abatement Of eau
ton III the placing 81 forward orders.
particularly in view Of the great in
crease in sales of a great variety OF
merchandise on the installment basis.
in the foreign field as whole
the situation IS more promising than
at any other time IN i years. Each
year one nation after another abroad
gains in economic and fiscal stability,
IN production and III employment.
War-inherited ta1nines haV" disap-
peaTed from the earth, standards OF
living are everywhere higher than at
any time since the war. In fact, 40
one in 1919 would have believed that
SO great Il measure Of recovery would
Tot cd nv
proof OF a high quality in European
craftsmanship. The Locarno agree
rnent promises much greater political
stability, and paves the way for an
other stage OF disarmament, with con-
Sequent Improvement III IN. eco
nomic outlook. OF the disturbed areas
England and Germany have not re,
covered employment in full: Frances
shows economic strength among her
people. but popular resistance has 50
far made il impossible 70 stabilize
the fiscal system; China continues in
the throes of civil war, but business
nevertheless continues; Russia makes
progress as the government slowly
abandOns socialism. The quantity of
goods moving in international trade
az q whole has recovered TO the pre-
war level, although some countries are
below. and fully 90 per cent OF in
ternational business is now based
upon stabilized currenGIes.
"On the whole, both our own cour.-
try and the rest Of the world face
more favorable outlook at this turn
of the year than for Il long time past.
We ourselves, however, need to be on
our guard against reckless optimism.
What we need Is an even keel in our
financial controls. and our growing
national efficiency will GprtiDUa lis in
increasing prosperity"