sharply with the rate of $7 which had been reached in August, 1914. During March the activities of the stock market increased owing to business conditions and to Supreme Court decisions favorable to the railroads. By one of these the two-cent passenger rate law of Virginia was annulled and by the other the reduction of freight rates on coal by North Dakota was set aside. New York City was able to float a sale of bonds at 42 per cent; copper rose to 152 cents per pound, an increase of more than 2 cents; cotton rose by a similar amount to 9 cents; while the price of wheat at Chicago was about $1.60 per bushel. In April all minimum limits for stock exchange transactions were removed; steel plants were occupied to 70 per cent of capacity; the price of copper rose to 21 cents and the prices of wheat and cotton showed slight advances; but the striking feature of the month was the outburst of speculation on the New York exchange, 21,000,000 shares being transferred. This outburst was due mainly to war orders which resulted in large advances in Bethlehem Steel, American Locomotive, New York Air Brake, and the stocks of motor companies. In May there was some recession in the price of commodities; stocks declined, in part owing to the sinking of the Lusitania, but June brought recovery in stock prices. The decision of the Supreme Court against the dissolution of the Steel Corporation brought a favorable movement in stock prices, but the resignation of Secretary of State Bryan caused some reaction. The prices of sterling exchange had continued to fall and the importation of $40,000,000 of gold did not prevent a decline to $4.75. Copper prices continued to advance but the price of wheat fell to $1.04.

The influences favorable to business revival during the first half year continued to operate during the second half. Large contracts with foreign governments for military supplies resulted in wild trading on the exchange in July; steel plants increased their business to 87 per cent of capacity; pig iron production increased and railroad traffic rose considerably. August was marked by the transfer of 20,500,000 shares on the New York exchange; by continued advances in the prices of railroad securities, due in part to the granting by the Interstate Commerce Commission of freight increases to the western roads; the enormous crops produced a favorable reaction on business in general. The decline of sterling exchange to $4.50 was checked in September by the negotiation of the Anglo-French loan of $500,000,000. It was during August and September that stock speculation was most reckless, the shares of some of the companies profiting by war orders gaining as much as 30 or 40 points in a day. It was during September also that the railroads began to feel a pressure of freight for export.

The fourth quarter of the year was characterized by the continued increase in the volume of business and the optimism of business sentiment. Another outburst of speculation in war order stocks resulted in the transfer of 26,679,000 shares in October, numerous days being marked by a business of from 1,000,000 to 1,500,000 shares. Bethlehem Steel made a phenomenal advance to 600, having opened the year at 464, and declining in December to about 460. There were similar but less extreme advances in some other stocks. Pig iron production made a new record

of over 3,000,000 tons in October, and by the middle of November the activity in the steel plants of the country was without precedent. This was due not only to the war orders, but to the fact that unprecedented business encouraged the railroads to spend large sums for cars, rails, and other equipment. The enormous export traffic at eastern ports forced the railroads to reduce free storage time from thirty to fifteen days, there being at one time 50,000 loaded cars on side tracks near New York. This congestion was due in part to the reduction in the number of ocean carriers by the war. In December the attention of the stock market turned somewhat to railroad securities, but considerable gains were still made in the stocks of the war order companies. In spite of the fact that certain roads had gone into receiverships, the relatively favorable condition of railway finances in general was shown by the statistics of the Bureau of Railway Economics. The net revenue per mile of line for roads comprising 228,000 miles rose from $220 in January and February, to about $300 per mile in each of the next three months, and to $477 per mile in September. The net income for these roads in September was 17.4 per cent above the previous five-year average, and subsequent months were not less favorable. The increase in net revenue of railways over 1914 was estimated at $168,955,000. The foreign trade for October totaled $477,000,000 and for November, $495,000,000. The excess of exports over imports reached the maximum of $178,857,000 in October. During every month of the year there was an excess of gold imports over gold exports, the maximum of $76,731,000 being in October and the total excess for the year being $429,000,000. Moreover, extra dividends on the stocks of copper, oil, and powder companies were declared. Steel prices reached the high average of $39.70 per ton, a gain of $7.50 since August and of nearly one-third since 1915 and the highest average in eight years.

CROPS. Not a little of the great prosperity of the United States during 1915 was due to new records in farm production. Thus the wheat crop for the first time exceeded 1,000,000,000 bushels, the actual production being 1,002,029,000 bushels. This was an increase of 110,000,000 bushels over 1914. The corn crop exceeded that of the previous year by over 400,000,000 bushels, reaching the enormous amount of 3,090,000,000 bushels. Oats likewise set a new maximum of 1,517,478 bushels, while barley with 236,682,000 bushels was 20 per cent in excess of the 1914 crop. The total value of all farm products including grain, vegetables, fruits, and animal products for the year was estimated at $10,000,000.000.

PIG IRON PRODUCTION. One of the best indexes of business conditions is the volume of pig iron production. During the last four months of the year this averaged about 3,000,000 tons. This contrasted with 1,601,000 tons in January. The output increased steadily every month until October, the total for the year being about 29,796,000 tons, an amount exceeded only in 1912 and 1913, and being about 6,500,000 tons greater than in 1914. The total for the year may be compared with a total of 30,724,000 tons in 1913; 29,727,000 in 1912; and 23,649,000 in 1911.

AUTOMOBILE INDUSTRY. A notable feature of the year's industry was the great expansion in the automobile manufacture. It was estimated

that the retail value of cars and trucks sold in 1915 aggregated $691,778,000. This included 842,249 passenger cars at $565,856,000; and 150,369 trucks at $125,922,000. Exports were estimated at $100,000,000 or two and one-half times as great as in 1914; of this sum about two-thirds was for commercial vehicles. See AUTOMOBILES.

STOCK EXCHANGE. The changes in business sentiment were reflected in the activities of the New York Stock Exchange, though this statement must be qualified on account of an excessive and unreasoning spirit of speculation which prevailed during April and during the fall months. It was this speculative fever which undoubtedly made the total shares exchanged for the year greater than in any year since 1909. The number of shares sold by months were as follows: January, 5,076,210, February, 4,383,449, March, 7,862,308, April, 21,022,930, May, 12,581,040, June, 11,004,042, July, 14,371,633, August, 20,432,350, September, 18,399,286, October, 26,678,953, November, 17,634,270, December, 14,647,000. Total for the year, 173,000,000 shares. That these figures represent an extraordinary volume of business is shown by comparison with totals for previous years: 1914, 47,900,568; 1913, 83,470,693; 1912, 131,128,425; 1911, 127,207,258; 1910, 164,150,061; 1909, 214,632,194. The speculative fever was also reflected in the phenomenal advances of some of the stocks. The advances were due almost entirely to the great volume of European trade due to war orders. The stocks of these companies came to be known popularly as "war brides." The following are a few instances of the advances during the year shown by first and last quotations of the prices of common stocks: Anaconda, 50 to 91; Baldwin Locomotive, 40 to 117; Bethlehem Steel, 46 to 459; General Motors, 82 to 500; Studebaker, 36 to 167; Industrial Alcohol, 20 to 121; Crucible Steel, 18 to 73; Continental Can, 40 to 84; Lackawanna Steel, 28 to 81; Tennessee Copper, 32 to 63. These prices were less in all cases than the maxima attained in the fall. Thus Baldwin Locomotive went to 154 on October 23rd; Bethlehem Steel to 600 on October 22nd; General Motors to 559 on December 9th; Studebaker to 195 on October 22nd; and Lackawanna Steel to 95 on September 29th. Toward the end of the year interest attached to railroad shares and the stocks of all the principal railroads of the country showed considerable advances with the exception of Missouri, Kansas and Texas, Missouri Pacific, and Wabash, which were in financial difficulties.

The bond market reflected somewhat the same wide-spread interests in investments. The transactions on the New York exchange by months were as follows: January, $57,100,500, February, $43,842,500, March, $63,214,500, April, $110,359,500, May, $64,284,200, June, $57,957,000, July, $55,535,500, August, $72,253,000, September, $80,741,000, October, $105,191,500, November, $130,088,500, and December, $120,110,000. Total for the year, $956,500,000 par value. While the advances in bond prices were not phenomenal yet there was a general upward movement for the bonds of the government, of railroads, and of industrial companies, ranging from 1 per cent to 6 per cent. The total transactions for the year were exceeded in 1909, but not in any subsequent year. The

totals for immediately preceding years were: 1914, $461,526,600; 1913, $501,571,020; 1912, $675,213,500; 1911, $890,210,100; 1910, $634,722,850; 1909, $1,317,291,000. The ease of the bond flotations showed the abundance of available money due to the revival of prosperity and especially to the enormous export trade. In this connection reference should be made to the foreign credits established during the year and noted below. One notable result of the year's transactions was the increase in the number of stockholders of principal corporations. A summary for 23 railroads, 14 public utility companies, and 28 industrial corporations showed an increase of 25,447 in the number of stockholders during the year.

Another important result was the great absorption of American securities previously held abroad. When the war began the par value of American securities held abroad was estimated variously from $4,000,000,000 to $6,000,000,000. Mr. L. F. Loree, President of the Delaware and Hudson Company, after a thorough study of American railway securities held abroad, concluded that their par value was $2,223,000,000, and their market value, July 31, 1915, was $1,751,000,000; industrials owned abroad on that date were estimated $518,300,000 par value. His inquiry showed that $480,892,000 par value of these railway securities were sold in America in five months; it was known that during this same period $140,000,000 par value of industrial securities were also exchanged. On this basis it was estimated that during the year more than $1,000,000,000 of stocks and bonds previously held abroad were bought by American investors. The remarkable financial strength of the country made possible not merely the repurchase of these securities, but also the extension of credits aggregating $1,000,000,000, besides which gold imports exceeded exports by over $425,000,000.

SECURITIES. According to the Journal of Commerce the total authorized capital of all companies incorporated in the United States in 1915 with a capital of $100,000 amounted to $2,061,000,000, an increase of over 30 per cent compared with 1914. For companies with a capital of $1,000,000 or more incorporated in the Eastern States this paper reported an aggregate of $1,426,000,000. This amount compared with $894,947,000 in 1914, and $1,534,000,000 in

1913.

The actual issues of securities by railroads in 1915 aggregated $780,216,000. Of this $541,350,000 were bonds, $216,515,000 notes, and $22,350,000 stocks. Industrial companies issued a total of $655,134,000, including $241,838,000 bonds; $110,918,000 notes, and $302,377,000 stocks. Moreover, the Daily Bond Buyer reported during 1915, 5181 issues of long-term State and municipal bonds aggregating $482,220,000, the largest amount of such securities ever issued in one year.

BANK CLEARINGS. The bank clearings for 137 cities reached the enormous sum of $186,079,731,000, an amount never before equaled, and exceeding the previous maximum in 1912 by 7.8 per cent. During the first quarter the clearings aggregated $38,915,000,000; second quarter, $43,427,000,000; third quarter, $44,271,000,000; fourth quarter, $59,466,000,000. For the month of December the total was $20,167,000,000, or .5 per cent more than in October or

November, in either of which the clearings exceeded those of any previous month in American history. By geographical divisions the clearings for the year were as follows: New England, $8,838,236,000; Middle, $23,939,698,000; Western, $7,189,399,000; Northwestern, $21,678,344,000; Southwestern, $9,926,078,000; Southern, $6,865,044,000, and Far-Western, $6,642,930,000. At principal centres the clearings were: Boston, $8,256,935,000; New York, $110,204,392,000; Philadelphia, $8,863,633,000; Pittsburgh, $2,666,312,000; Chicago, $16,198,985,000; St. Louis, $4,153,535,000; Kansas City, $3,835,061,000; Baltimore, $1,833,648,000; San Francisco, $2,693,688,000; Los Angeles, $1,048,128,000.

Canada. Bank clearings in Canada were slightly less than in 1914, amounting to $7,653,000,000, a decrease of .4 per cent from 1914. Slightly more than one-third of all clearings were at Montreal, nearly one-fourth at Toronto, and one-fifth at Winnipeg.

FAILURES. In spite of the many indications of business prosperity, the number of commercial failures in 1915 exceeded those of any previous year. R. G. Dun & Co. reported 22,156 suspensions in 1915, with aggregate indebtedness of $302,286,000; similar figures for 1914 were 18,280 and $357,908,000. Bradstreet's reported 19,032 failures with $283,432,000 liabilities, these figures being respectively 13.4 per cent higher and 20.7 per cent lower than in 1914. The liabilities were, moreover, 26 per cent less than in 1907 or 1893, but the number of failures had never been equaled. The business mortality was very high, but as conditions improved in various lines, failures became fewer. In the fourth quarter the number was 37 per cent less and the liabilities 50 per cent less than in the first quarter.

Likewise railway receiverships of the year were unusually numerous, the mileage under receiverships being the greatest in nearly 20 years. The total mileage was 39,905; and the par value of bonds represented $1,678,129,000, and of stocks, $707,603,000. The most important lines were the Chicago, Rock Island, and Pacific; the Missouri Pacific; the St. Louis and San Francisco; the Missouri, Kansas, and Texas; the Wabash; the Texas Pacific; and the Père Marquette. It was alleged that one factor in many cases was the restrictive legislation of Southwestern States, notably Oklahoma

and Texas.

Canada. Failures in Canada reached the number of 2621, a decrease of 9.1 per cent from 1914, but exceeding the number in any previous year. The liabilities aggregated $31,989,000, an increase of 4.2 per cent over 1914, and greatly exceeding any other year.

BUILDING. According to Bradstreet's the building operations in 155 American cities aggregated over $806,000,000 in 1915. This was an increase of 4.5 per cent over the total for 1914. Nevertheless, during the first seven months, the building expenditures were less in each month than in the corresponding month of 1914, except in May, when there was an increase of 3 per cent. During the last five months there was an increase each month over 1914. While the figures for the first nine months showed a decrease of 5 per cent from those of 1914, the last quarter of 1915 showed expenditures exceeding those of the last quarter

of 1914 by 53.2 per cent. See also BUILDING OPERATIONS.

AMERICAN INTERNATIONAL CORPORATION. This organization was incorporated in New York about December 1, under the direction of the National City Bank. It was capitalized at $50,000,000. Its purpose was to develop American trade with foreign countries, promote the investment of American capital in industrial projects in foreign lands, and develop markets abroad for American goods. The charter of the company empowered it to deal in securities, acquire concessions, make explorations, develop mines, smelt ores, build houses and factories, construct telephone and telegraph lines, wharves, and reservoirs, and indeed to do whatever was necessary in carrying on legitimate business. Among its directors were Frank A. Vanderlip, president of the National City Bank; Otto H. Kahn, of Kuhn, Loeb and Company; J. Ogden Armour of Chicago; James J. Hill, of the Great Northern Company; William E. Corey, of the Midvale Steel Company; and many other wellknown financiers and industrial promoters. This corporation was formed under the leadership of the National City Bank which was carrying out a policy of establishing branches in principal South American cities, and which had acquired control of the International Banking Corporation with its 16 banks in China, Japan, India, the Philippines, Panama, and elsewhere.

FOREIGN CREDITS. One of the most unique and remarkable features of the financial history of the year was numerous and large foreign loans or credits floated in this country. It was estimated that their total exceeded $1,000,000,000, and that about 80 per cent of the proceeds were expended in this country for war supplies of all kinds. The Canadian government secured a 5 per cent loan amounting to $45,000,000, while 8 Canadian Provinces and 10 Canadian cities borrowed a total of $102,000,000. Various Latin-American countries secured a total of $50,000,000, of which Argentina secured $15,000,000 on notes and $31,000,000 on treasury bonds. Small loans or credits to various European countries were as follows: Switzerland, $15,000,000; Sweden, $5,000,000; Norway, $8,000,000; Greece, $7,000,000. German treasury notes to the amount of $10,000,000 were sold in the United States. Russia, which placed orders for war supplies amounting to $70,000,000 in the single month of October, and had previously placed orders estimated as equally great, secured one loan of $32,000,000, and late in December was negotiating a second loan of $60,000,000 to run for 90 days, but renewable up to 18 months. According to announcement this new loan would bear 5 per cent and 1 additional per cent for each 90 days' extension. Italy secured $25,000,000 on one year 6 per cent notes convertible at maturity into 6 per cent one year bonds; these latter were in turn exchangeable for 10 year 52 per cent bonds. In addition to the Anglo-French loan noted below, France secured $75,000,000 on notes, bonds, and collateral; and London banks $50,000,000 for six months. At the close of the year plans were under way also for additional credits for both France and Great Britain, to be based on American securities mobilized by the bank of England and the bank of France.

ANGLO-FRENCH LOAN. The most notable for