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Show H FREIGHT RATES AND COST OF LIVING. I I- ,' ' An item of much interest in Henry Clew's latest market review , is that in which the financier declares that had the railroads secured . the advance in freight rates as they had asked for, the cost of living1 H I would be much higher than it has been at any time during the past. H i) Mr. Clews in part says: H ' Time has been given for the financial community to recover its H equilibrium after shock of the decision of the Interstate Commerce i H i ) Commission. Only railroad managers showed any serious perturba- H j L tion- Our great bankers entirely ignored this factor in the placing H ' of their new flotations, thus proving that they did not regard the H decision as in any degree affecting the credit of the railroads, The H fruth is the railroads failed to prove their case, and no injustice H J was done them by the commission; since, if present conditions are f proved to be unworkable, they will have full opportunity for a rehearing re-hearing after further trial of present rates. Many of the railroads are reporting liberal gross earnings, and there is little doubt but that by means of economy they will be able to continue satisfactory net results. The stronger roads, which are in the majority, seem likely to go on as usual with projected improvements. .Some of the weaker lines are already beginning to economize and defer improvements. improve-ments. The effect of the decision was certainly disappointing to man- agers and also to concerns which furnish the railroad's supplies, but there is no doubt whatever that the decision of the commission will ultimately exert a wholesome and necessary restraint upon recent business tendencies. Had the railroads succeeded in making their advances, increased demands from labor would have followed, wholesalers whole-salers and retailers would have been obliged to charge higher prices to meet increased freight bills, and the whole effect would have been to still further elevate prices and increase the cost of living. In other words, we would simply be continuing the ridiculous process of lifting ourselves by means of our boot straps; a tendency that has much to do with recent derangement and came near creating a serious crisis by placing the United States upon a level dangerously higher than foreign countries Of late the tendency has been for a reduced cost of Jiving Food products have especially declined and many other commodities, notably iron and steel, have been on thedown-ward thedown-ward grade. Bradstreet's Index Figure dropped from 9.23 in January, Jan-uary, 1910, to 8.07 in February, 1911. This declining tendency seems likely to continue, owing to quiet trade and restraints upon speculation. But had railroad rates been increased a movement in the other direction might have been expected, for we would certainly have had a temporary period of increased activity which, however, would have proved more in the nature of an intoxicant than a genuine genu-ine recovery. |