edged law of nations and the principles of that law in their legitimate development and expansion must prove controlling, whether they contemplate a temporary abridgment of neutral commerce or whether they justify its prosecution in channels sanctioned by the highest authority. The effect of such rules as between those engaged in war, however, should properly be left to the decision of their forces or opportunities such as they may be. For both neutral and belligerent, nevertheless, international law as crystallized in our own country and in Great Britain by executive action, by the carefully considered decisions of the highest courts, and by legislation in harmony with acknowledged principles of international law, point out the only safe pathways and those in which both governments and individuals should find their truest advantage.
| FUTURE BANKING PROBLEMS OF THE UNITED STATES WITH REFERENCE TO THE EUROPEAN WAR |
By Professor THOMAS CONWAY, Jr.
UNIVERSITY OF PENNSYLVANIA
PUBLIC opinion in the United States concerning the effect of the great European war upon this, country has passed through several distinct stages. The first period was of brief duration. Many people, recalling the prosperity of this country during the Napoleonic wars, jumped to the conclusion that it would bring financial and commercial prosperity to us.
This delusion, for such it may be termed, was rudely shattered by the consequences which followed thick and fast during the first few days of August. Our stock exchanges closed even before war was officially declared, the cash reserves of our banks were reduced almost over night below the minimum prescribed by law, emergency currency in very. large amounts must be issued, interest rates soared, banks advised retrenchment and caution, orders were cancelled, factories closed or operated only part-time, while cotton became not only unsalable, but of unknown value as collateral.
In the face of such circumstances, of which these instances are illustrative, public opinion entered upon the second stage. Pessimism abounded. Fears for the safety of friends and relatives abroad, coupled with highly colored, but inaccurate, news from the seat of war, led to the greatest apprehension. We came to regard Europe as wholly mad, destroying everything; suddenly bereft of all business prudence or sound sense. In this period arose the hysteria of a German invasion of our shores, although a hundred times further removed than the English coast, apparently unattainable to her. During this period arose the dread of uncontrollable foreign liquidation of American securities and of our banking system, drained of every dollar of its gold reserve. Happily this period of horror and depression has nearly ended.
