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Readjustment
and
Reconstruction
All authorities agree that the pres-<
»
ent period of economic readjustment
is to be brief. If things progress as
-well as may be expected in Europe,
industry in this country should be get
ting the full tide of reconstruction ac
tivities by next September and headed
for at least two years of prosperity
and splendid business.
The present pause in industry, as
everyone knows, has its being in the
cost of commodities. The price level
as the war left it was impossible. In
dustry could thrive so long as its
products were required by govern
ment. But the minute that the mar
ket depended on private consumption,
that minute industry had to come to
a standstill.
But the transition from a war-price
level to peace-price level is being ac
complished with a rapidity that had
been thought impossible. Copper, one
of the basic commodities, already has
dropper to normal pre-war levels, and
other commodities are making satis
factory progress. Nor ha3 the transi
tion, so far, resulted in the panicky
developments and the epidemic of
pailures that had been predicted. Re
ceiverships may come later to the
less far-sighted concerns that were
caught overstocked with goods pur
chased or produced at war-time cost
levels. But so far all classes of busi
ness have managed to keep afloat and
the decline in commodity price levels
has been so generally expected that
it is probable the business fatalities
resulting therefrom will be fewer than
has usually been the case in minor
readjustment periods when the dan
ger was much less, but not so gener
ally appreciated.
Hie performance of the copper mar
ket since the government price went
off, January 1, has had more than
any other single thing to do with
the predictions of an early resumption
of business activity on a peace basis,
before the government put the lid on
Copper prices these were up half way
^between 30 and 40 cents a pound.
" The. government price was 26 cents
a pound. Even before the regulation
was withdrawn, on the first day of
the year, there had been an unofficial
shading of prices. Since January 1
copper has ,dropped steadily until at
this writing there are sales reported
at 15 cents a pound. This is a drop
of 42.3 per cent in seven weeks. Be
fore the war copper frequently sold
at the 15-cent level. Taking into con
sideration the somewhat, higher costs
of labor and materials (as compared
with 1914) that are likely to obtain in
general for several years, and also
the formation of the export organiza
tion that will keep foreign buyers
from forcing down American copper
prices, copper is today selling consid
erably cheaper than it did in periods
of activity before the war.
Copper was the first of the commodi
ties to get back to a peace basis be
cause the copper industry was left
in worse shape by the unexpected end
ing of the war than any other hig
industry. The producers were left with
a billion pounds of copper on hand
produced at the 26-cent cost level.
Neither American nor foreign consum
ers could or would pay this price.
The metal simply had to get down
to more reasonable levels, and it did.
The copper situation, being thus so
bad, holds within itself also the germ
of growth for a new period of active
production and prosperity. In the
United States is a copper-consuming
public that has been unable to supply
Us needs for a year and a half. An
enormous domestic demand is certain
to spring up the minute that construc
tion and general business production
are resumed. Abroad, Germany and
Austria-Hungary have been without
any new supplies of copper since 1915.
When industry finally gets on its feet
there a very great demand should
gradually be created. The allies them
selves have had copper only for mili
tary purposes, and as soon as shipping
and other conditions more nearly ap
proach normal, they should join Ger
many in a very heavy demand upon
the American copper interests.
Conditions being at the moment so
bad in the copper industry, the con
sumers will hardly be in shape to
place big orders before midsummer.
But thence onward the orders will
roll in, and by next November, say,
the producers will again be long on
cash and short on visible copper sup
ply.
The copper industry has been dis
cussed at length because It 1b the first
to go through readjustment, and its
coarse illustrates what Is taking
place and what must take place in
all industry before the nation can en
ter the reconstruction era and enjoj
active business again.
Next to copper, ocean freight rates
have most nearly readjusted them
selves. Cuts of from G6 to 75 per cenl
already have been made. These re
ductions do not make cargo space as
cheap as one might at first glance
think. The tariff is still 100 per cenl
above pre-war levels. It Is now, how
ever, down to a point where it is pos
sible and profitable to resume normal
traffic activities. As soon as more
tonnage is available the ships will de
liver a blow at food and other prices
that will do more than almost any
thing else to restore normal condi
tions.
At this writing steel prices are
straggling down in anticipation of an
other formal cut of $4 a ton, whicl
is expected to come in a few days.
The first drop from the government’s
fixed prices came January 1, and rar
from $3 to $5 a ton. This was nol
enough to produce any buying orders
It is hoped that the second reduction
will bring buyers. If not there will
be other breaks until a practical level
is reached and the steel industry be
gins to supply the great building de
mand that has been stopped foi
eighteen months or more, and whicli
insures great activity in the building
trades for several years to come.
One of the first indications that
lower prices were on the way came
from the woolen mills. In Decembet
the American Woolen Company held
some big auction sales to sound out
the market. Woolens were bought al
from 25 to 30 per cent below the price
prevailing at that time. Buyers were
few, however, and it is expected thal
further concessions will soon be made
The decline already noted, however
takes the price back to where it was
a year ago.
There has been a slash of 30 per
cent in the price of cotton fabrics
cotton and wool have been sold down
petroleum prices have been shaded,
first-class postage rates will come
down July 1, and a long line of food
prices have had more or less drastic
declines. Were it not for the gov
ernment guaranties the price of foods
would now have gone much further
toward readjustment than is the case.
Australlian and Argentine wheat can
be delivered in the United States now
at about $1.25 a bushel, the only limi
tation being the scarcity of tonnage.
But that limitation will rapidly be
come less effective. The government
sooner or later will have to let wheat
seek its real market level, and will
have to pocket the loss involved in its
$2.26 guaranty. As soon as wheat and
pork are released to seek their nat
ural level all grain and meat prices
will break.
Tho nrif>o lolinr i a hnunrl un in
the price of foods. So far there has
been no great effort to liquidate la
bor. In readjustments of this kind
the wage level is the last one to de
scend. The big employers shade prof
its and cut dividends first. They lay
off hands but continue those on the
payroll at the boom wage schedule.
But eventually the wage level follows
the living cost level down. Wage re
ductions have occurred in some oi
the big corporation plants and unem
ployment is reported from all centers.
Returning soldiers are increasing the
competition. The minute that the gov
ernment lets go the wheat and pork
guaranties foods will come rattling
down and wages will follow very
shortly thereafter.
The cost of labor will not, of course,
reach pre-war levels. Seven million
workers have been killed by the wai
and ten million have been maimed
An additional six million persons died
of influenza. The world’s supply oi
common and skilled labor has beer
drastically reduced. Special elementi
complicate the American situation
We have a literacy test for Immigrants
that has not yet had a chance to op
erate, and organized labor is now try
ing to bar out all immigration. A mil
lion aliens are now waiting in the
United States to go abroad as soot
as military restrictions are lifted. II
is doubtful If foreign governments al
low any great exodus from Europe
to this country.
There are offsets, however. Witt
the reduction In production laboi
there has also been a reduction It
demand. The world has at least 12,
000,000 fewer mouths to feed. The
war has given thousands of men e
considerable mechanical and organ
izational training that will make then
bigger producers In the future. Ii
the United States the negro, for th<
first time, has become an lndustrla
asset. Employers have given him th<
chance to learn semi-skilled occupa
tlons and he has to an unexpected ex
tent made good. Women, too, have
for the first time invaded all fields
has to an unexpected extent made
of labor and have had a chance to
learn skilled production. Taken all
in all, it appears that while wages will
not return to their pre-war levels,
they will gradually fall to a point
where they are not an obstacle to
prosperity and full-power production.
It seems that in so far as high
prices have been the product of short
supply and war restrictions, readjust
ment will have been so far accom
plished by next summer that the nor
mal tendency of things to open up in
the autumn should establish commerce
and industry throughout the nation on
a very solid basis of activity. The
only cloud in the domestic outlook is
the possibility of further government
war loans.
The high cost of living that we must
get rid of before the reconstruction
era can blossom out has been caused,
in part of course, by credit ar..l cur
rency inflation. The per capita money
in actual circulation in the United
States reached the high point of $56.23
last November, and the stock of
money in the United States increased
a billion and a half dollars in twelve
months. Steps are being taken to re
duce this inflation as rapidly as pos
| sible. Between the end of December
and the end of January the Federal
Reserve banks succeeded in reducing
the amount of reserve notes in cir
culation from $2,685,244,000 to $2 466,
OOb.Ot.O. If it were not for the huge
government loans that still confront
the nation conditions would improve
even more rapidly.
Even with the fifth loan of next
month it was thought that the situ
ation would quickly better itself as
soon as that campaign was out of the
way. But the recent statements of
Secretary Glass seem to indicate that
another loan of three or four billions
will have to be floated in the autumn.
At the present time the banks are
carrying their customers on about two
that have not yet been -paid for, and
billion dollars’ worth of Liberty bonds
the next loan will renew this form of
inflation. The continued requirement
of great sums of money by the gov
erment can exert a strongly retarding
influence on the pace of our return to
normal conditions. The domestic sit
uation really hinges on this point. The
tail-end of war financing alone stands
between business and a very early re
sumption of activity.
As regards the world-wide demand
for American products there can be
no question. The building situation in
all parts of the United States is typ
ical of almost all consumptive fields.
Aside from war industry plants, there
has been almost no building in the
last eighteen months or two years.
The accumulated demand, plus the
normal increase in requirements, con
stitutes an enormous potential buy
ing power. So it is with all branches
of industry.
--♦
Fresh shipment of Brookfield saus
age arrived on this boat. Blum,
O’Neill Co.
-«
The Daily Times job plant is
well equipped for all classe of com
mercial printing.
Electric Wiring
and Repairs—
JOHN G. YOUNG
Leave Order* at Cordova
Sheet Metal Work*.
Phone 143
KENNY HOLDENS
Pool and Billiard Parlors
CIGARS, SOFT DRINKS AND TOBACCO.
FIRST-CLASS BARBER SHOP
IN CONNECTION
MUSIC EVERY NIGHT PHONE 15
r=i— ..
CHAS. GOLDSTEIN & COMPANY
of Juneau, Alaska
Offer to the trappers and dealers of the North
the followinig prices for No. I Prime Furs:
Lynx, extra large No. 1.$35.00 to $37.50
Lynx, large No. 1. 30.00 to 35.0(
Lynx, small . 20.00 to 25.00
Mink, dark coast skins. 5.00 to 7.00
Mink, dark coast skins, small. 3.00 to 5.00
Mink, fresh water. 5.00 to 10.00
Land Otter .. 12.00 to 15.00
Red Fox, No. 1 large. 30.00 to 35.00
Cross Fox, according to beauty.. 50.00 to 100.00
Muskrats. 75 to 1.50
Silver aud Black Foxes, as to color
Wolverine . 5.00 to 12.00
Wolves.5.00 to 20.00
Ship us your Furs! As soon as recelrod wt wUl grade same and
wire our best offer. If our prices are not satisfactory we wlU .return
the furs and pay transportation chargee on same both ways.
References: Any bank In Alaska, Dexter Merten Netlenal Bank, Be
attie; National Bank of Taeoma, Tacoma* Wash.
SATISFACTION GUARANTEED
We operate the largest Fur Ha nr factory north of San Francisco.
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BRAND-NEW BIT OF BANKING SERVICE \
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i THF PI AN We will receive your Liberty Bond | ]
*i ^ _ -[n any amount for deposit to the j j
|; credit of your bond account. j :
j; The bonds will be stored in a fire : I;
i j and burglar-proof vault, and upon
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• the interest to your bond account. I ; t
The Result Thus the safety of your Liberty i |
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No Charge will be made for this service and it 11
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i -THE_ ! I
|| FIRST BANK OF CORDOVA 1
• Pioneer Bank of Co rdova and Copper River Valley •
: j SECURITY_ service satisfaction I s
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Sixty Steam-Heated Rooms, Electric-Lighted
Hot and Cold Water in Every Room
With or Without Bath
Cordova House
DOOLEY & GREENIG
Headquarters for Railroad and Mining Men
Satisfaction Guaranteed :: Rates Reasonable
ALASKAN GRILL
FRANK A. DOUGLAS, Proprietor
“The Home of Quality and Attention”
The Popular Restaurant of Cordova. Every
thing First-Class. Special Attention Given “*
to Parties
ONE VI8IT TO THE ALASKA GRILL WILL MAKE YOU A
REGULAR PATRON
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SOLICITING THE PATRONAGE OF
THE EPICUREAN
and discriminating public, I desire to call attention to a few of the
reasons which I am confident make this Grill a popular one and en
titled to their kind support.
BETTER COOK8—BETTER COOKING—BETTER 3ERVICE
TABLES AND BOOTH8 FOR LADIES BANUET ROOM C.
UNDIG’S GRILL
Phone 30
MRS. JOHN NELSON
JUST RETURNED FROM THE EAST WITH A COMPLETE
LINE OF
LADIES’ FURNISHING GOODS
AND WILL HAVE 8AME OPLN FOR SALE TOMORROW.
LATEST STYLES. REASONABLE PRICES.
ACROS8 8TREET FROM MODERN LAUNDRY .