The Bismarck tribune. [volume] (Bismarck, N.D.) 1916-current, 1925-12-11
COUNTRY is
PROSPEROUS,
SAYS MELLON N
Cautions Against Excessive
Speculation Tendency in
Annual Report
BUSINESS STIMULATED
Pcrpetuation Of Large Public
Debt Not Sound Policy,
Says Treasury Head

Washington. Dec. li.-tP) EARLY
accomplishment of complete world
wide economic stabiliZatlon is fore
seen by Secretary Mellon.
Both at home and abroad, the Sec
retary declared in his annual report
submitted to Congress today. devcl-
opments Of the last year have been
so satisfactory that the way is now
clear for a more complete world re-
cover" Mr.. Mellon believed the un-
derlying factors Of the business sit
uation here were Fundamentally
sound and warrant optimism for fu-
ture."
Reviewing the events which had in
fluenced conditions for the better, he
mentioned, with respect to the Unit
ed States, restoration Of confidence.
tax reduction and reform, removal
of various factors of uncertainty
and instability. steady employmen mt
in farm and factory, and generally
augmented purchasing power.
Across the seas, he saw the I'M
provement reflected by II foreign
debt settlements here and a number
Of interallied funding arrangements
the return Of dozen nations to the
gold standard. revival of industrial
activity with its consequent employ
ment, the reorganization of the cur
rency systems of nearly all of the
smaller powers, and the promised
benefits Of the Locarno agreement
"All of these" he said. "lend sup
port to the optimistic view regarding
the economic rehabiltati of Eu-
rope"
Tax Reduction Stimulates Business
Mr.. Mellon suggested that, the re-
vision of taxes promised at this ses-
sion of Congress was feeding new
stimulus to business. but he enter
ed complaint against exemptions
proposed by the House Ways and
Means Committee. These narrowed
the foundation of the taxing Sys-
TEN, he thought. declaring it should
be broader if the tax program were
to be successful in times Of depreS'
sion us well as in days OF prosperity
While the Secretary saw no ap-
preaching cloud on the economic
sky, he warned against expansion
and speculative tendencies. The pro
gram of public economy has had its
effect. as has the public debt re-
tirement program. he said. but there
is some tendency for the consuming
public to buy every conceivable COM
modify 'on time and mortgage fu-
ture earnings On the other hand
he found business men conducting
their affairs with restsant and eau
tion in order that the prosperity may
not bring on carelessness.
ut is hoped. furthermore he add
ed, that the speculative tendency in
real estate in some communities ma!
not proceed to the point Of under
mining the spirit Of caution. in busi
ness
Too Drastic Cuts Mean More
Borrowing
Although Mr.. Mellon was con.
vinced that the promised tax rcduc'
tion had added impetus to business
plans, he counselcd against too
great Il cut, declaring that some
of the reductions advocated were dan
gerous and would involve the Treas
ury in new borrowings. He assert
ed that it was unsound for any ma
ton not to reduce its outstanding
obligations as rapidly as possible
and he regarded the good effects OF
the Trcasury's program in this re-
spcct as having been fully demon,
strated.
"The country is prosperous nov
and we'll able to lquidate its debt
at reas enable rate" he continued
"That will gradually reduce the tre'
mendous interest charges. The per
petuation Of large public debt has
never proved to be sound policy
On the contrary it has often been ;
great handicap in an emergency
Mr.. Mellon reviewed the depart
ment's work in enforcement of pro
shibition and expressed the belief
that progress had been made in re-
ducing the supply of illicit liauo,
through the reorganization directed
by Assistant Secretary Andrews. he
suggested that expansion OF the
Coast Guard was necessary If 1t
were to continue efficient work in its
dual capacity as a conserver OF life
and property and guard against
rum smuggling, and reiterated thai
the departments policy was to at
tack sources Of supply rather thar
to attempt local police work.
Debt Funding Progress
With reference to funding Of the
foreign debts, Mr.. Mellon reported
"gratifying progress" and pointed tt
the IL arrangements under which
$7,434. so, 900 will be paid back t(
the United States. That leaves $4,
500 1865 900 on which no action ha:
been taken, including the $4,2lO, 900.
900 marked up on the Treasury book:
against France. Mr.. Mellon hoped
that other settlements would be con
cluded soon but did not name any
of the powers thus referred to. The
Treasury. he said, was mindful OF
the condition of the government
debtors and had granted liberia
terms for the earlier years. The
amounts were made up in later years
in each instance, he added, because
the obvious recuperatiye powers OF
the nations assured that they would
be able to meet their comm time nts
then.
Included in the Secretary's re.
port was one by the American Debt
Commission, of which he is chair
man. That report made mention Of
frequent press comment respecting
refusal of the administration to
sanction foreign loans here when the
powers seeking new money had not
funded their debts to this govern
ment.
Sanctioning Of Foreign Loans
"Early in 1925, after much consid-
eration," the commi ssion report
said, ''it was decided that it was
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