THE MONTHLY BUSINESS REVIEW.
demands of the banks’ communities, but also the speculative demands. Taking it all in all, a
expansion of credit has taken place, and at a time when, under ordinary circumstances,
should have been the order. No doubt the lure of the high rates on call money in New
has also had its bearing on the situation.Another result in this District of the increase in the rates is that paper secured by the Liberty
Bond issues no longer commands a preferential rate over commercial paper, suggesting
time has arrived when a great effort must be made to practice thrift and economy, and to
product of thrift and economy to a reduction in the loans against United States securities—
words, to put the war issues back of us and thus release funds for our commercial and indus-
demand for both commercial and collateral loans is very strong and rates are high and firm.
highest grade commercial loans are being made at 5
per cent, all others secured and un-
being negotiated at
uncertainty and unfavorable development of conditions surrounding the discount market of
Fourth Federal Reserve District during the past month, have had a reactionary effect on the volume
acceptance business. In the early part of the month the general improvement of the market spread
great deal of optimism among the dealers, but the constantly increasing rates for call money
change of rates by the Federal Reserve Banks soon caused the market to become very dull. There
a complete fallingoff of business from new sources, as well as from banks that were already
market. The only supply of bills at present comes from the banks that had made previous arrangements with their customers to accept their drafts. There seems to be no indication that the
are encouraging the use of bankers’ acceptances while such a small margin remains to their
comparison with other forms of commercial paper. It is too early to state what ultimate
change in discount rates will have on the open market, but so far it has tended to stop all
The portfolios of the brokers are filled, and they are not seeking additional bills until there
some hope that the former demand will be restored.
would seem that the higher rates would attract new buyers into the acceptance market, and this
expected unless other forms of loans rise to rates that are unheard of. Just at present it seems that
entire market is awaiting a readjustment of present conditions, and all are watching the action
to learn what procedure will be necessary.
Effects of Steel Strike Greatly Minimized. Production Almost Normal
With the steel strike now reduced to a scale of small importance, producers and consumers are
concerned with the effects of the loss of production previously incurred than with present operat-
difficulties.Except for a very few spots, Western Pennsylvania may be said to be practically free from strikes.
Wheeling district remains almost entirely closed. It is estimated that the strike thus far will
a loss of about one month’s production. Apparently steel has not become as scarce by reason
strike as was expected—the forecasts of scarcity having been based upon the assumption that
was far from plentiful before the strike began. The large demand was occasioned somewhat by
disposition to stock up.
production of steel for October, it is said, averaged about 60 per cent of the rate immediately
strike while production at the present is estimated at 70 per cent of this amount.A premium is the present rule for immediate shipments in small tonnage lots. The regular market
by the March schedule. Common grade sheets are in good demand and the supply fairly
with a better situation than that of thirty days ago. .The strike seemed strong where this
sheet was made and the effect was immediate and the curtailment pronounced. The effect
was also to
curtail the processes necessary for special sheets. Production
reported to be constantly
on the increase.
Automobile builders have suffered not alone for want of sheets, but also in the matter of other