The Business Barometer
This .Week's Outlook in Commerce, Finance, Agriculture
and Industry Based on Current Developments.
B* THEODORE H. PRICE, Editor,
Comoro* tad Finance. New York.
There are two divergent views now taken
of the European situation and Its reac
tion upon America. One Is that war is Im
possible because Germany has neither
• money nor weapons and cannot get the
latter now that France is in possession
of the great steel mills of the Ruhr,
t.'pon this hypothesis it is argued that
business in the United States has nothing
to fear except the impairment of Eu
rope's purchasing power that will result
from a prolonged paralysis of German in
dustry and the cost of maintaining the
French troops In German territory.
The other view is that a nation that
wants to fight can always find the sinews
and weapons of war. That the imperial
Slid militaristic 'party in Germany is
now organizing for war and that when
the time is ripe, it will be able to com*
rrxand the support of Russia, whose Ger
manised army of 1,200.000 men i§ well
equipped and ready for action against
France, when It is called upon.
Correct Theory Unknown.
No one can say which of these theo
ries is correct. Tt is doubtful whether the
French government Itself can foresee what
v*iU bs the consequences of its present
policy, or to what extremes it may carry
the nation.
But here In Wall street we say "the
ticker talks,'' which means that the course
of prices reflects tho significance of
events more truthfully than the published
news, and the decline registered la3t^ week
in marks and francs, as well as in French
national and municipal bonds Is not re
assuring to those who like myself, prefer
to be optimistic.
Tt is therefore safer, though leas agree
able. to take the gloomier view and con
sider what effect a war in Europe, If It
occurs, would have upon American bus
iness. If happily we shall he mistaken
and agreeably surprised by a spring timj
biaappearance of the war clouds that now
overhang the valley of tho Rhine, our
■ aution meantime will not have cost us
much for the markets ure likely to con
tinue in a. state of suspended anima
tion until tho outcome Is decided one way
or the other.
Most Buy From V, 8*
The most important thing for us to
bear In mind is that if war Is renewed
the belligerents will be compelled to bu>
largely of us, .lust as Germany has al
ready been compelled to buy English coal
because France shut off the supply pre\l
ously obtained in the Ruhr.
The effect of this buying if it occurs |
will be to advance prices and the advance,
will probably be the greater because,
neither Franco nor Germany h*'4® anj j
. iedit her. *nd will be compelled to .end
, , the remnant of the world a gold sup- ,
• |v under their control. The raeult would
ha to still further enlarge the basis of our
. redlt structure and make P”**lhl” *"
..pension of loans that
inevitably lead to what Is celled I"'’*110"'
Therefore It seems logical to conclude
that history would repeat Itself and tha
after thj tnltiei shock of a new war had
h-en felt we would enter upon a twr'od
anovulation and hectic activity aimllar ,
to the one through which we passed In
1915 and 1916.
But if on the oth-r hand some peaceful
modus vlvendi ehall be arranged as be
tween France and Germany so that the
work of European reconstruction can be
resumed the result would be even more
beneficial to us for we should enjoy a
gradual improvement in the export de
mand for our staple products that would
mean a far more enduring prosperity In
tho United States than war could possibly
bring to us. Btit It would not be accom
panied by the exaggerated advance in
prices that Is generally an incident of
war and for this reason as well as for
considerations more humanitarian it I®
much to bo preferred.
Demand for Wool.
The record of the week aeems to in
dicate an unconscious perception of tha
fact that however providence deals the
cards we are likely to get a good hand,
for while activity Is restricted price*
have been steady to firm and some ar
ticles are distinctly higher. One of them
is wool, which reflects the eager demand
for woolen goode that developed at the
spring opening of the largest manufac
tures. Others are tea and coffee. The
latter has advanced quite sharply since
It was made plain that a large portion
of the Brazilian governments holdings
have been disposed of. Btili another la
lumber.
In the metal Industry an almost buoy
ant tone is reported. Copper Is up to 16c
and there la something of a scramble for
ateel that cannot be met because of the
labor scarcity. The cotton goods market
has also been decidedly busier at higher
prices, although cotton futures seem
halted In their upward course by the talk
of a big acreage next yesr and some re
duction In the export movement.
Market# Quieter.
The stock and bond markets have also
been quieter. The bigger stock specu
lators are away on their winter holidays
and tho rather sensational decline in the
so-called Durant motor shares has made
the smaller fry careful. The bond house*
are waiting for their cuetomera to digest
the large issues they have recently ab
sorbed, but It is not likely they will have
to wait long for, although the weekly
statement of the federal reserve banks
shows a loss of about 15.000.000 gold, the
reserve ratio Is up to 7«.t per cent and
this means a superfluity of credit which
must somehow find employment.
The most Important financial news or
the week is Great Britain's acceptance of
the administration's proposal for the set
tlement of Its debt to us. hull details
are given in the news dispatcher and
need not be restated here.
In brief they contemplate the payment
of the debt in year*, during which
period interest on the unpaid principal
will be paid at the rate of S per rent
for the first 10 years and 9Vi per cent
thereafter. ....
It Is expected that the necessary ratifi
cation of this settlement will be speedily
obtained from congress and that It will
usher in an era of good feeling between
the two great English-speaking peoples
of the world that will mean much Tor
the world's peace and prosperity.
- E™ °r Kna 01 , . _
l««t week previous week Ran "'*r
Rank Clearings fBradstreels) ,lt IT 038,851 IS,809,11:
In thousands . * 114 508 481
Ru.~.iness failures . "0 9ri 76.4’; 76.:’i
federal Reserve ratio .. • '
security Prices, N. T. Stock Rxchange _ », J8I.I6
:o Industrials . 's'na 8* 46 73.1*
to Railroads . slll sg 18 16.78
40 Bonds ..
Commodity Prices •• Ji 17
Wheat. May delivery. Chicago. * 78“* 7114 .54*,
forn, May delivery, Chicago . loir 'tl'i: 18.05
Pork, ribs. May delivery. Chicago. \n ls js i:,85
Beef. gd. dressed steers. Chicago . j)959 #s.# .osOu
Sugar, refined. New York. l*»i .12*4 .0144
«'offee, Rio No. 7 .. '»740 *»*40 .1720
Cotton. middling. New York . - 07vi .05
Print Cloths. New York t\"t 8001 5471
Wool, domestic average, New York- * *5 j'30 7 20
Silk. No. 1. Slnshiu. New York .. .1114
Rubber. crude, planta.. New York.... oq ieti
H'dcs pa^k. No 1. New York . .g'eg 2134
;r«1. No. 2. Pittsburgh. HgiJ ;6.40 21.00
Steel billete. Plttaburgh .. .^ 5 ___
Financial
New York, Feb. 4.—Wall street, and
with It most of the foreign markets,
appeared last week to have arrived
pretty definitely at the conclusion
that the aspect of the "Ruhr crisis,"
which financial markets had to con
sider, was the economic and not the
political. The stock exchange, both
of New York and Europe, had all
along shown by their strength or their
indifference that they were wholly
skeptical over the earlier predictions
of a German military uprising or a
move by Russia to Germany's assist
ant or the breaking up of the entente.
Although the common talk of Wall
street was long colored by the alarm
ist rumors, their entire nonfulfillment
rrade It impossible last week to take
them seriously any longer.
„ But this very diversion of interest
fro mthe political hazards of the Ruhr
experiment converged it more closely
on the economic hazards, Undoubt
cdly the persistent and at times vio
lent decline of foreign exchange rates
on continental Europe emphasized
these considerations.
Difficult t® Analjte.
Tn a situation of this sort it ir "sver
possible to determine bow far a fall, in
exchange reflect* political
ar.d how* far merely economic tnlagi'tng.
in the present ca*e. h°^«Yer. the ce -
iflnty of unpleasant economlh C0I2"*
onances was admitted on
t^a, idea of formidable political conse
quonces was disappearing^
Last week's dispatches from responsibly
European trade circles reported steel and
Iron works In Lorraine and Luxemburg
shutting down because of the
Ruhr fuel supplies. Industrial Fran s
was already handicapped in its own op
e.-ations and no doubt could be enter
tained over the eventual consequences in
Germany. Along with th'.-. there had to
he considered th'* effects of u mutual
trade boycott on one another by I ranee
r*nd Germany. Tn the first 10 months of
last year. Germany’s export* to France,
'■utsid* of reparation* payment In kind,
ere 376,000,000 francs and the p«ports
«.f France to Germany were 1,438,000,000
fiance.
It is probable enough that the posM
hilitlee In that direction have had a hand
•; the extreme decline of French exchange.
On the other hand. It sould be reasonably
apparent that the proapect even of a very
extensive, shrinkage in the trade or
Franco with one other country could
Kirdly. of itself, explain the fall of the
franc virtually to the lowest price over
reached by 1t ©n the New York exchange
market. The price of 6.76 V*c, to which
1 he franc declined on Wednesday, had i
never been touched since the day in No
vember. 1*20, when It reached Its low
record figure of 6.72c. But In November,
f 620, the French paper currency stood at
Ha highest recorded total of 36,51 4,000.000
frr.ncs, having Increased 2.226,000.000
within a year, whereas last week's fig
ure. 27,088.000.000 showed 1.120,000.000 d*
riease In 12 months. In 1620. imports of
merchandise into France exceeded her ex
ports by 10.671.000,000 francs. In 1622
the import surplus was 2.256,000.000. The
paper currency and the adverse trade bal
ance are still unduly large, but they pre
sent no such economic picture na that
_ which wae reflected In the low price of
The franc towards the end of 1920.
Question Open to Debate.
Thl* leaves It open to debate, exactly
why so excessively violent a fall In the
franc should have occurred on the news
from the Ruhr. As against last week’s
low price of 6.76Uc, the franc stood at
9.37c last April nnd 7.88c at the end of
1922. Hack a decline might reflect, like
ihe fall of the German mark, rapidly In
creasing inflation or a rapidly increasing
balance of trade against the country; but
we have seen that neither cause bus ex- ;
■ Iste<T In the case of France. There are
left only three pnsalbl causes; all of them
ha^e visibly operated In the greater de
clines of the foreign exchanges during the {
past two years.
Withdrawal of English or German or
American funds from Parle banks, and j
their remittance to London or Berlin or1
Now York. !• one of them; it would at 1
a certain point cause overwhelmingly large
selling of French exchange. Speculation
for the decline Is another. It Is heally
* temporary application • of (he same
procesa of ahlftlng credit balances from
l’arta to foreign markets, because no one
can speculate for the fall In exchange on
a given market except through directly
or Indirectly borrowing money In that
market and then drawing away the pro
feeds. *The third cause, usually a sequel
to the others, la the postponement of their
remittance* by merchant* or hanker* In
foreign market* who ha e obligations to i
met in francs,
*
Chicago, Feb. 4 —Practically all the
surroundings in the wheat market arc
of a bearish character. With the ex
ception of the possibility of a radical
change in the foreign situation or a
major crop scare in the winter wheat
belt, there seems to be little in the
situation at the present time on which
bulls can base operations that would
tc#d to bring about a material up
turn.
The mysterious buying of May
wheat which checked declines time aft
er time, is said by those in a position
to know to have been baskspreadlng
between Chicago and Winnipeg, the
buying having been done here. Mill
ions of bushels were spread when the
difference was 7$ 10c 'per bushel, and
profits have been taken on an exten
sive scale of late. The big short in
terest which existed here in conse
quence was the main support.
Market Weakened.
Technically the market has been greatly
weakened by the buying, and while there
is less hedging Treasure than would natur
ally be expected urder prevailing *ondJ
tlonx. the burden ia gradually growing,
and lower prices than heretofore witnessed
would not surprise many traders before
long. Aa I* ueusl when the wheat market
!• weak, bearish influences are likely to
be highly magnified, and reports of a bull
ish character receive little attention.
When it is considered that Germany,
Poland, Austria-Hungary and some of the
smaller European countries are practically
bankrupt from s government monetary
standpoint, the difficulties of trying to
do export business in gralna and in other
commodities can be easily understood.
This has greatly restricted the broad dis
tribution of American grains and as long
os the United States remains a surplus
producing countries the markets will more
or lera be affected by European financclal
conditions.
The world situation is by no means hope
les«, however, and a good part of the
present condition Is largely the result of
political developments. Economies have
been ignored in an effort to obtain politi
cal advantages, and what improvements
hns been made in conditions since pesos
has been in the lace of app»rert govern
ment Interference. Left io itself the
world's trado Would quickly regain He
cqui!!|yium.
Krtasaa City Grain.
Kansas City, Mo. Feh 8.—Cash wheat
—No. 2 hard. fJ. 1001.18; No. 2 red. 11.82
01.28.
Corn—No. 8 white, 70He; No. 3 yellow,
714 072c.
Hay—Unchanged.
Kunsas City, Mo . Feb. 3 —Wheat—
May. 11.09% spilt bids; July. $1 05% eplit
bid; September, tl 08%.
Corn—May, 7! He aekod; July, 71%e
asked; 8*ptembar, 71 He split bid.
Minneapolis Fleur.
Minneapolis. P>b. 3—Wheat—Cash No.
1 northern, |l.llrt 0 1.26; May,
July. 11.17 H.
Corn—No. .1 yellow, 0D06»%r.
Gate—No. 3 white, 39%0 4OUc.
Harley—50060c.
Ilye— No. 2. 60% 010%r.
Flax—No. 1, StH039Hr.
Minneapolis Floor.
Minneapolis. Feb. 3.—Flour—-Unchanged.
Bran—527.00021.00
HOME LIFE INSURANCE CO.
NEW YORK
Wm. A. Marshall, President
Tha 68d Annual Report shows
Premiums received during
the year 1942.$7,360,885
Payments to Policyholders
and their beneficiaries in
Death Claims, Endowment*,
Dividends, etc. .. 5,400,769
Amount added to the In
surance Reserve Funds.... 2,206,762
Net Interest Income from
Investment . 2,110,922
($722,802 in excess of the
■ mount required to main
tain the reserve)
Actual mortality CTperifhre
62.87% of the amount ex
pected.
Insurance In Force.$232,168,052
Admitted Assets . 46,253.715
Total amount paid to policy.
holders since I860. $6,461,054
CONN W. MOOSE.
General Agent State si Nebraska
437-9 Kaaline Building, Omaha, Nth.
During January, just closed, The Omaha Bee gained
in every department of Advertising, over January of 1922. The total
gain paid advertising, less legal, in lines being 53,774.
<J And during 1922 The Omaha Bee made very material
gains in its circulation. The increase in the daily average being over
14,000 and the increase in the average Sunday circulation being more
than 18,000.
’<1 That The Omaha Bee is growing, and growing fast is
evident on every hand. Merchants and readers alike know that The
Omaha Bee today is the kind of a newspaper that is good for Omaha
and good to have in the home.
<J And now, Mr. Advertiser, we would like to have the
opportunity of showing you just what this growth means to you. Call
AT-lantic 1000 and one of our men will bring you the details with him.
The Omaha Bee Publishing Co.
Nebraska’s BEST KNOWN Newspaper
