HARDWOOD RECORD 



The Outlook. 



Even the great interest that is being taken in presidential nom- 

 inations pales into insignificance compared with the concern the 

 public feels over the future of the business situation. In the 

 opinion of the Eecord, the worst of the period of depression is 

 over, and from this time on we may look for a fast-growing 

 renaissance to normal situations in the business world. It must 

 needs be known that it has not been only the ITnited States which 

 has been in a state of financial disquietude and restricted business 

 progress for the last few months, but the world at large as well. 

 The Dominion of Canada has been having "hard times." Great 

 Britain has been having slow business. But Germany has suffered 

 worse than this country; the business situation in the Fatherland 

 has been extremely bad for months, and on top of that money 

 has been very scarce and high; interest rates in Germany are 

 25 per cent higher than in this country. France probably has 

 suffered the least of the great nations in the general diminution 

 of trade. 



There are still some features in the situation that are not 

 roseate. For example the monthly expenditures of the govern- 

 ment have exceeded the receipts since last fall, and May presented 

 no exception to the rule. There was a deficit for the month of 

 nearly $12,000,000. For the eleven months of the fiscal year the 

 deficit amounted to $63,600,000. This is a decidedly unusual and 

 abnormal condition. The June circular of the National City Bank 

 of New York calls attention to the fact that in only nine of the 

 forty-two years from 1865 to 1907 have receipts been inadequate, 

 and it says that the current fiscal year, with the single exception 

 of 1899, bids fair to produce the largest deficiency since the Civil 

 War. Receipts have declined both from customs and from internal 

 revenue, and expenditures have increased. In view of the appro- 

 priations that Congress has made, retrenchments are not among the 

 probabilities. 



It is only by an increase in business that increased receipts can 

 be obtained, and it is reasonable to suppose that there will be a 

 speedy and marked improvement. Not only is the expectation of 

 better times prophesied by men of large affairs, but we are having 

 no such industrial crisis as has occurred in former panics. There- 

 fore, considering the energy and resources of the nation, it would 

 indeed be strange if there was not a marked reaction. 



Domestic commerce movement for the month of April, as re- 

 ported to the Bureau of Statistics of the Department of Commerce 

 and Labor, indicates an improvement in the lumber and anthracite 

 coal trades, though the live stock, meat, grain, soft coal and iron 

 trades show but little sign of a return to normal conditions. Lo- 

 cally the movement of lumber is showing improvement. The local 

 commercial freight agent of the Baltimore & Ohio advises the 

 Eecord that the movement of lumber over the lines of that road in 

 the vicinity of Chicago, has been greater during the last two 

 weeks than for the previous two months. Other railroad men 

 advise similar conditions. 



In view of the foregoing facts, the Kecohd wishes to reiterate 

 its belief that the backbone of trade depression is broken, and 

 that the country is on the eve of renewed business activity and 

 consequent prosperity. 



Hardwood Situation in Germany. 



The business depression, which has been almost universal, doubtless 

 reached its climax in Germany last month. For a time the outlook 

 appeared to improve, and the Hamburg auctions held on May 13 and 

 14 were well attended. Owing to vacation time coming on the next 

 auction will not be held before the end of August. 



A goodly amount of cedar for lead pencils has arrived from 

 Florida; from Haiti a smaller amount came; there is a good assort- 

 ment of cigarbox lumber on hand. For ebony from Africa there is 

 good call, so that importations may be encouraged. The call for 

 American oak is confined principally to small logs for fancy veneer. 

 There is a strong eaU for American ash, so that large stocks have not 

 accumulated. The arrivals of American hickory have been so numer- 



ous of late that consumption cannot keep pace with supply, and more 

 consignments would merely pile up without market. 



The shortage of good dimension and veneer stock in walnut has 

 been so pronounced that there has been no trouble in disposing of 

 what could be had, and prices have in consequence been steadily ad- 

 vancing. The large importations of poplar the first of the year have 

 ceased; however, the call has been such that even with new arrivals 

 the last two months stocks have not piled up to any extent. At sales 

 newly imported satin walnut has been- satisfactorily disposed of, but 

 it was literally impossible to dispose of old stocks, which still remain 

 on hand. 



The Past Financial Tension. 



Under this heading the Timber Trades Journal of London prints 

 an editorial which reflects in a marked degree the fact that Great 

 Britain has had "troubles of its own" and that the United States 

 has not encountered exceptional business conditions during the past 

 six months. The Journal says: 



The timber trade may now be said to. have emerged from 

 an undesirable location, and a sigh of relief is perhaps excus- 

 able. Hj- now practically the whole of last .year's purchases 

 will have been paid for, and the only problem remaining in 

 connection with them is the manner in which balances re- 

 maining on hand are to be marketed with a minimum of 

 loss. If, however, the history of the financial tension in 

 the timber trade which denoted the winter of 1907-8 ever 

 comes to be written, we think it would prove to be — if all 

 is true that is whispered — a narration of a somewhat inter- 

 esting character. It is, at any rate, well known that the 

 banking fraternity seem to have devoted quite an undesir- 

 able kind of attention to timber trade accounts, even those 

 belonging to firms of high standing not altogether escap- 

 ing in the general scrutiny. That the timber trade indeed 

 should have gone through so severe an ordeal, if not scath- 

 less. at least with colors still flying, is a remarkable testi- 

 mony to the inherent soundness of the industry. Profits 

 have, of course, in many instances had to be ruthlessly 

 sacrificed in order to turn stock into currency, but this is 

 a matter relatively unimportant compared with the main- 

 tenance of the financial prestige of such an important 

 branch of commerce. At this period it is not now perhaps 

 of much importance to rake up what is, after all, ancient 

 history. The timber trade on this side has, however, had 

 a severe lesson In the laws of supply and demand. Evi- 

 dences of a falling off in the consumption that was to be 

 were not, it is true, lacking even in the early part of last 

 year, but not ev-?n the confirmed croakers of the trade ever 

 seem to have foreseen the depression which, intensified by 

 the American financial crisis, was to mar the winter months. 

 With bills maturing on the one hand and general stagna- 

 tion in the demand on the other, it was not surprising that 

 as stocks accumulated in docks and yards there should be 

 tension of another kind elsewhere. The episode Is not, of 

 course, witliout its lessons. In the first place, it seems that 

 in making his purchases the timber trader does not pay 

 sufflcient attention to current and prospective demand ; and, 

 in thr> srrnn.l plafe, even though the sore be fresh, it never- 



llhl 1 1^ I I rubbed into the trade that it is folly to 



.■ili.iiipi I" i>i'' np import figures with capital insufficient to 

 lurri 111,. liuir.iiiiL's of hapd times. 



A Point Scored. 



The first direct result which may be attributed to developments 

 following the conference of governors held at Washington recently, 

 and one which may be classed as another distinct "Roosevelt vic- 

 tory", is the fact that on May 15, before the conference had ad- 

 journed, the House Committee on Interstate and Foreign Commerce 

 authorized a favorable report on the Burton bill, continuing the 

 President's Inland Waterways Commission until July 1, 1909. The 

 sentiment of the Senate expressed in the so-called Newlands bill 

 denotes practically the same intention. At the last session Congress 

 refused to authorize the commission and the President appointed it 

 without special authority, declaring in the conference of governors 

 his intention to continue it himself if necessary. Congress has now 

 weakened in the contest, due directly to the influence of the confer- 

 ence, and all signs point to a complete surrender to the policy of 

 the President. 



