DEPRESSION IN GERMANY.

Press, Volume LXIV, Issue 13105, 2 May 1908, Page 8

DEPRESSION IN GERMANY.

For some time there inave been' signs <rf growing depression im Germany, and a telegram in yesterday's issue amtnounoed that unemployment is generalin almost all industries. The tmrtlh is that Germany (has been making the same mistake as America. Oa»rrred away by rtihe exoitememit of a. "boom," manulfooturere and the direatora of industries generally have been tradins; beyond their capital, and as soon as the supply of loanaible money fell short of requirements, sometihing approaching a panic took .place,, and those establishments -which ihad boon relying too (heavily upon credit had at once to restrict tftieir operations, and in not a few instances to go into liquidation. Tiwt> other causes helped to bring about a crisis—the iieavy protective tariff, which materially increased the cost of Jivdng, land the ever-growing "weight of (taxation, which bis diminished tiho spending power of the people. The foreign trade of the Empire for January showed cJeariy enough a falling-off in business prosperity. Imports dropped t0'3,644,0 tone, -which comipares with 4,194,000 tons for 190T and 4,578,000 for 1906. Exports dropped to 3,168,000 tons, against 3,264,00 a year ago and 3,611,000 two years ago. Another indication of the situation, "was given when the Hambu<rg-Amerik& Hne, at the end of February, announced a dividend of 6 per cent, against 10 per cent, for 1906. The North-German J/loyd warned its ebjareholderß mot to expect more than 5 per cent, dividend for the past year. The coal *trade was the last "to feel' the coming wave of depression, but at the end of February the syndicate wifoich. controls the collieries voted a restriction' of prodattion by 10 per cent. This action, instead of reducing prices in sympathy -with, the price movement in other industries, excited a good deal of indignant criticism: The financial stringency was shown/ by the fact that tie Imperial Bank of Germany" would not. reduce its bank rate to less than' SJ, when the Bank of England rate was lowered to 3 per cent. Even at this figure the Reichstag showed very little powor_of drawing gold from other countries. The effect of the depression in Germany is to be felt elsewhere, although the influence will not be altogether prejudicial. It -will probably lessen, the demand- for -wool, and eoact as a drag upon prices, : and) English, manufac-

turers will be subjected to keener competition from their German rivals, who, in their anxiety to get cash, will out prices and push their business more persistently than ever. On the other hand, it is not improbable that the distress arising from the numbers of nen out of work and the general fall in" wages, will Jbring about a strong agitation against the tariff and other restrictions dpon imported meat. If these should be swept away or even modified, the result should be beneficial to the colonial frozen meat trade. Another very important consideration is that the falling-off in the revenue and the growing impatience of the people at the heavy taxation, may impose a salutary check on the Emperor's ambitious scheme of building up a navy sufficiently strong to enable him to challenge Britain's supremacy on the sea. As the English programme of construction is practically regulated by what Germany is doing, a halt on the part of the latter will enable the British Government ■with perfect safety to cut down a large proportion of the proposed expenditure on new ships. A policy of economy in Germany, therefore, may be of distinct and direct benefit to the British taxpayer.