A glance at these articles will show that most of them were intended chiefly for military uses, and that their heavy exportation presumably will be but temporary.
It is interesting to note that some other articles of customary export showed large declines in 1915 as compared with 1914. During the same ten months' period, for example, our exports of agricultural implements (and parts) declined from $21,028,588 in 1914 to $11,162,609 in 1915; of wood and manufactures thereof, from $68,904,895 to $45,325,146; of fertilizers, from $7,735,613 to $3,758,598; and of sewing machines, from $7,757,421 to $4,902,594.
Viewed from the standpoint of the destination of the articles exported, the significant fact is that the increase in exports was chiefly to Europe, and not to Central and South America and Asia—the places in which we have been strenuously endeavoring in recent years to build up a permanent export trade....
... After the war is over Europe will presumably discontinue, or greatly reduce, her importations from the United States of most of the articles which figured so largely in the great increase of 1915. As her needs tend to become normal again she will immediately endeavor to resume her old-time trade connections, both import and export, at least in so far as the trading centres are in countries that were friendly or neutral during the war. In seeking to re-establish these connections the merchants of the belligerent countries will be strongly backed by their Governments, which the war will have made more socialistic and more aggressive. They will have a great advantage in the fact of long-established business relations, and in the fact that the war trade will have been to such a large extent abnormal, both as regards the products dealt in and the parties to the trade.
Europe's banking machinery in South and Central America, although it may not be very actively functioning in these trying times, still exists, and will be ready to resume its former activities as soon as peace is declared....
On the basis of London Stock Exchange listings British investments in Latin America early in 1914 were computed at nearly $6,000,000,000. Germany also has a large number of banking establishments in South America and heavy investments.... United States investments in South America are very small as compared with those of England and Germany, while only one American bank has established branches on that continent. These branches are only five in number, and the oldest of them is but a little over a year old.
The conclusion seems clear that the war will need to be very long and very disastrous to England; and American merchants, bankers, and investors will need to be much more active and far-sighted in their exploitation of South American opportunities than they have been in the past, if London is to yield to New York her financial premiership for South America.
Other obstacles to New York's becoming permanently the world's financial centre are its great distance from the financial markets of Europe, America's small merchant marine, its provincial protective tariff policy, the absence of an adequate supply of men possessing the necessary training both in foreign languages and in commerce and international finance to go into these foreign fields and to "tie them up" commercially and financially with the United States, and the slowness with which our recently reorganized banking system and our American discount market must grow, as regards international business, if it is to have roots that are strong and grow deep.
The United States has before it a great opportunity. Much depends upon the foresight with which Americans prepare themselves to meet the tremendous readjustments that will be demanded at the close of the war. That will be the supreme test. Now is the time to build for the future, and to avoid paying too much attention to immediate profits. New York can hardly be expected to succeed to London's position as the world's financial centre, at least for some time to come; dollar exchange will not at once take permanent rank ahead of sterling, or even alongside it; none the less, if the United States refuses to be blinded by the glamour of large immediate profits from a type of trade that is necessarily abnormal and temporary, and if she seriously turns her attention to the opportunities now open to her in Latin America, she will make a long step forward in the direction of financial leadership.