GERMAN TRADE AND COMMERCE

Evening Star, Issue 14184, 8 October 1909, Page 7

GERMAN TRADE AND COMMERCE

The Annual Series of Diplomatic and Consular Report gives the report on the trade and. commerce of tho consular district of Fraukhirt-on-the-Alain for the twelve months ended April 30, 1909. by .'ousul-General Sir Francis Oppenhehncr It is full of interesting information on a groat variety of subjects, and we subjoin extracts therefrom. —Private Coffers Full.—

We subjoin extracts dealing with, some of the more important subjects treated in the report. After observing that the commercial depression which was felt all over the world in 1908 did not in Germany assume the character of an acute crisis, he goes on to say : After such a rush breathing time was welcome for concentration and the gathering of new forces. The resignation of 1908 was partly due to quite an exceptional exhaustion of economic forces, but in this feeling of exhaustion there mingled something of contentment. Never before have the private coffers been filled as during the last boom. Actual figures of tho aggregate profits collected cannot he ascertained, hut certain facts will serve as indications in that direction. In 1907 the high rate of exchange had made borrowing practically an impossibility. Now slocks and new shares could not be- issued, and the most necessary leans, public and private, had to stand back. In tho coins© of 1808 tho bank rate was lowered by 31 pier tent (from 7) per cent, in January to 4 per cent, in June), and in consequence the market was flooded with now issues. The aggregate of tho German issues is more than 3.000,000,000 marks (among which German stocks, 551,175,000 marks; municipal loans, 264.634,400 marks; mortgage bonds, 365,000,000 marks: industrial debentures. 335.580.000 marks, etc., were issued on tho Beilin Stock Exchange alone),' and by far the greater share of this tremendous sum was taken up in Germany. Foreign purchases or participations were admittedly disappointing and insignificant. Early m 1909 the national wealth of Genu any, which had been estimated at 2-20,000,000,000 marks fifteen years ago. was estimated to have reached 350.000,000,000 marks—i.e., an increase of j 59 per cent, in half a generation. After giving a table relating to savings bank deposits, the report says that while during 1900-05 the number of deposit books increased by 22.7 per cent, and tho total deposits by 44 per cent., during 1905-07 they increased by only 7.55 and 10 per cent, respectively. This is considered to he attributable to the increased cost of living, and also to tho fact that “ with increasing wealth people are apt to become less thrifty.” —Chances of Revival of Trade.— The reduction, in the bank rate did not offer sufficient inducement for a revival of trade. When the rate has been sufficiently lowered, some expect that the building trade,_ which has been practically at a standstill for tho last two years, will set the ball rolling. Speculative building is impossible when, tho bank rate averages 5.15 (in 1906), 6.03 (in 1907). and 4.75 (in 1908). The building trade, with a fair prospect of a quick turnover after an interval of two years, would revive other trades in turn—tho trades in bricks and stones, cement, in woodwork, glass, upholstery, etc., though, owing to the new processes of building, the iron industry could not thereby benefit as heretofore. Yet possibly building will not be resumed on the scale which some anticipate—and thus a time-honored impetus to trade would fail for the first lime, which on occasions past has brought about the desired change. It has been an effect of the last slump that the migration of the rural population into ttic towns has not only ceased, but that there has been a remigration back to thc land. The overcrowding of towns generally is for the present interrupted, and temporarily the demand for dwellings has perhaps, on the whole, become less urgent. Again, factories have during the last boom been so greatly extended that no impetus to building can he qspectod from that source. The hotel industry, moreover, is overcrowded in many cities; railway stations and post offices have in most cases been brought up to requirements; the condition of municipal and State finance prohibits for thc time being thc expenditure for buildings of luxury, such as theatres, museums, etc. In the meantime the most natural and the best inducement for a revival of trade, the cheapness of all manufactured commodities in comparison with the price they had reached during the end of thc boom, has failed until now, in spite of an unprecedented supply ot cash, because the development which had taken place behind the wall of Protection—the system of .syndication—has killed free competition at Home, and has undnly raised the cost of tho raw material needed by the finishing industries. The agricultural protection as well as the industrial lias, moreover, increased the cost of living, and has narrowed down the margin of profit which might have been used like a safety valve for reductions of price to revive trade at Homo or facilitate competition abroad.

Syndication and Protection have, in fact, combined to, deprive German manufacture of that clastic cheapening power which ought chiefly to revive trade during the period succeeding a commercial high tide. c tirne the increased protection of the Home market has admittedly rendered foreign markets more difficult for the German manufacturer.

—The Cost of Living. In, last., year’s report it was stated that the behet was gaming ground that wages in Germany were not only approaching those paid m the United Kingdom for the f>anie class of work, but in some cafes even exceeded them. That the German workman to-day lives better than he used to there can he little doubt. The standard of Me has been raised all round ; the lowest aspect and standard of years gone by no longer exists. Food has improved, clothes have improved, Germany has become a rich conntry without the lowest grades of poverty which exist elsewhere. Wages have been increased in keeping with the higher level, let I do not think that, generally speaking, the German workman lives as well as the British workman. An interesting account is given of the ettorts being made to improve the inland watenvays of Germany, especially in Pmssia. these efforts have been a‘good deal hampered by the hostility of the Agrarians who fear that the projected Ehine-Elbe caa;u_ will lead to keener foreign competition m the supply of corn and other agricultural produce. The question of industrial credit has always been one of particular- interest in the modern development of Germany. would appear as if the system of industrial credit were gradually undergoing a change. It has been greatly expanded during recent years though, as the progress of 1908 proved, it hud not Men granted reckkr-Mv as during the preceding boom. Heretofore credit had, so fo say, been pressed upon inatstrnu clients of any importance by the baukHg concerns themselves, partly in the hope of thus preparing a lucrative future conversion orjssuc, partly in the hope of thus .forestalling the competition of other banking institutes. Quite recently the competition among hanking concerns has grown less keen, and there has been even a tendency towards co-operation between them. Complaints have been multiplied that th<smaller industrial concerns (especially these which have not yet been converted into companies) find considerable difficulty in obtaining the necessary credit. This is due to the disappearance of thc smaller private hanks, which, through their owners, were in personal touch with local industrialists.