In the manufacture of cheese, butter and condensed milk, labor gets one dollar out of every $16.50 produced. In the manufacture of coffee and spices, labor gets one dollar out of every $27.75 produced. In the manufacture of cordage and twine, labor gets one dollar out of every $7.70 produced. The list might be extended to the same effect. It is clear that the brewing industry does well by labor, pays the highest wages and gives the workingman the largest proportionate share in the financial profit."

In common with other great industries there is a marked tendency in the brewing trade towards the concentration of the business in the hands of the largest concerns. There are some 1,600 breweries in the United States. One hundred and fifteen brewing companies sold during the year which ended June 30, 1909, over 28,000,000 barrels, constituting about forty-eight per cent of the total output. Many of these companies are consolidations of a number of brewing plants, so that they represent some 200 plants. The following table will show the growth of the business since 1880 in the various divisions of states:

The growth of beer manufacture in the South is clearly shown in the above table. Until the development of the ice machine, brewing was practically restricted to the northern states. Thus, up to about 1880, most of the beer consumed in the South was shipped in from the breweries of the North. With the perfection

of refrigerating machinery, however, and the scientific discoveries which made it possible to brew and store beer in any climate, breweries began to spring up in all the important cities of the South. In many cases capital was secured from the North, by the inducements which were offered by local enterprise. In fact it is not too much to say that the cities of the South solicited the brewing trade, and that most of the breweries in the southern states were originally built by northern men with northern capital, under the assurance of moral support and an unlimited franchise.

There is no doubt that lager beer has already changed the drinking habits of the masses in the cities of the South, and that it has been an important factor in promoting true temperance. But the men who lead the prohibition movement do not discriminate between beer and spirits, and in the wild hysteria which has marked the recent exploitation of the temperance sentiment, all beverages which contain alcohol have been classed together, excepting only cider which is an "agricultural product," though it contains fifty per cent more alcohol than bottled beer, and patent medicines-which are supposed to be taken with a wry face, and must therefore be good for both body and soul. But the people of the cities are so thoroughly dissatisfied with the imposition of prohibition that there will surely be a readjustment before long, and with this will come a great expansion in the beer business in all the progressive south

ern states.

THE AMERICAN IRON TRADE OF 1909 AND THE

OUTLOOK

BY A. I. FINDLEY,

Editor "The Iron Age," New York City.

The recovery in the iron trade of the United States from the depression beginning with the panic of October, 1907, has been unparalleled in the history of such periods. In the summer months of this year the view was expressed that the revival in demand had come too soon after a serious unsettling of confidence to be considered the real beginning of another period of prolonged prosperity. The so-called Sunshine Movement of 1908 and the false starts that came with it were one reason for doubting the permanence of this year's improvement. There was a disposition in some quarters, in fact, to find a resemblance between the behavior of the market this year and the effervescent demand which came in 1895, two years after the panic of 1893, and vanished before the year was out. But the developments of the past three months have shown that the present movement has far more back of it than supported the little boom of 1895. Apart from the palpable signs of strength in the iron market itself, the present situation differs vastly from that of 1895 in respect to credit, soundness of the currency basis, the crops, the buying power of the country, and its capacity for adding to its wealth, saying nothing of the greater confidence in financial institutions.

What is said above refers not at all to the tremendous increase in the scale of iron and steel consumption in the United States since 1895, expressed by a ratio of about three to one, but to the state of health in finance and industry to-day as contrasted with the diseased condition that persisted in the years following the crash of 1893. Whatever may have been the opinion of some students of the situation in the iron trade two or three months ago, it is now plain that practically but one ground exists for comparing the movements of 1895 and 1909-the fact that an interval of two years separates each from a severe monetary panic.

It is not necessary, in writing of the revival in the iron trade,

to go at length into the causes of the late depression. Yet there can be no ignoring its railroad phases. Every estimate of iron trade conditions and prospects in the past two years has begun and ended with the railroads. Last year's prophets of an early return of prosperity, who said that the unsound methods of a few New York banks should not stop the wheels of industry all over the country, saw at length that it was more than a local affair and more than the penalty of bad banking. What the iron trade found out at heavy cost was that railroad demand, one of the strong props of the prosperity of 1906 and 1907, had all but disappeared. There was no escaping the conclusion that the Hepburn act and the various official notifications that it was but a fair beginning in the application of untried policies to the operation of railroads, had raised a serious question as to the value of railroad securities. It is now evident that while that doubt has not altogether disappeared, a saner view is taken of the whole railroad problem. That may be some compensation for two years of hardship. Railroad financing over long periods is again possible on terms which can be entertained, not only for the refunding operations and note redemptions which were common earlier in the year, but for the new track, new bridges and new equipment which all the large systems are now planning or have actually under construction.

As in all other periods of recovery the abundance of money, due to the enormous accumulations in banks in the many months during which industry has languished, is an important factor. It is true that thus far much of these accumulations have been devoted to a vast speculation in securities, but even this use, much as it has been deprecated, has not been without its stimulating effect upon the business situation. The common stock of the United States Steel Corporation has been in a spectacular way the leader in this speculative movement. No such gigantic operation for the lifting of a security value has ever been conducted and no other has been so successful. There is no question that the psychological factor in the advance of Steel common from 21% in October, 1907, to a fraction over 90 in September, 1909, has been an influence in the market for iron and steel products. It was evidently the belief of powerful financial interests that the actual demand for the products. of blast furnaces and rolling mills would speedily overtake the speculative movement, so that the values established by the latter

through skilful manipulation and the command of an enormous supply of cheap money, would in time be justified by the market for steel itself. Unquestionably this belief thus backed had no little to do in creating confidence in the continuity of the recovery that set in plainly in the spring of 1909.

Opinions will differ as to the extent to which the making of an open iron and steel market in February of this year has figured in the expansion of demand in the past six months. Those who consistently believed in the price maintenance policy of 1908 have been disposed to say that confidence was returning and that the time was ripe for a larger consumption. There were others who believed, as Andrew Carnegie did, that "the way to lift the market is to get under it." They considered that the only way to end the hesitation in demand, which they held due in part to doubt of the ability of the steel manufacturers by lawful co-operation to hold prices close to the level of 1907, was to make such cuts as would attract buyers. It was known for weeks before the open market announcement of February 18, 1909, that the co-operative movement was seriously threatened. Nominal market prices had been cut from $1.00 to $3.00 a ton, some of the smaller companies leading in these reductions. The sales managers of the various subsidiary companies of the United States Steel Corporation had been urgent for some time in appeals for permission to meet the prices of their competitors. The decision of the United States Steel Corporation that it would no longer maintain prices was announced by Judge Gary, its chairman, on February 19th. Of the reasons for this course he said:

It appears that, for one reason or another, including particularly the tariff agitation, many of the smaller concerns who have not been disposed to co-operate during the last year have become more or less excited and demoralized, and have been selling their products at prices below those which were generally maintained. This feeling has been somewhat extended and has influenced unreasonable cutting of prices by some of those who were opposed to changes but felt compelled to meet conditions in order to protect their customers. As a result of these conditions there has been a material decrease in new business during the last month for the reason, as stated by consumers, that they proposed to wait until after they were satisfied bottom prices had been reached.

In view of the circumstances stated, and the further fact that the stocks on hand at the time the panic occurred have been disposed of and the contracts