in which it brings forth things that are really wanted?

Nobody can be very sure of anything. There are hardly any clues in all economic experience to what will happen in the future. In degree, in ratio, and in magnitude the economic phenomena now taking place are incomparable. Moreover, they are unfinished. Nobody can say how long the war will last, nor, for that matter, how long it can last at the

present rate of destruction. There is really no measure of how much modern people, under the spur of great necessity, can both produce and do without. That is what makes the future of capital so uncertain. If habits of industry and selfdenial learned in war continued afterward among several hundred millions of people, the world might have to revise all previous calculations as to the rate at which wealth can be increased.

A

REVIEW of the latest military operations in Europe finds the world's interest more than ever centred in the gigantic campaign in Russia, before which all actions in the various other seats of war have, temporarily at least, dwindled into insignificance.

The middle of July brought the first aim of the Germanic General Staff's strategy in the east-the conquest of Poland-within sight of its realization. The final stage of the campaign for this important Russian province was ushered in by the breaking of the Russian right wing protecting Warsaw and the Vistula line from the north of Przasnysz on July 15. The force of the attack threw the entire Russian front between Zjechanow and the Omulev River back on the Narew line, and its suddenness took the garrisons of Pultusk and Ostrolenka by surprise and frustrated their attempt to resist. With the capture of these two strongholds the main breadline of the Russian front along and west of the Vistula, the Warsaw-Bialystok-Petrograd railroad, was exposed to the German attack and the fall of the Polish capital sealed.

Thus Field Marshal von Hindenburg's victory on the Narew front necessitated the gradual withdrawal of the Russian Josefow- (about forty miles south of Ivangorod) Jastrshomb- (fifteen miles southwest of Radom) Tomaschew-Rawka and Bzura line behind the Vistula between Ivangorod and Novo Georgievsk. On the front from Novo Georgievsk to Goworowa and Lomza the German drive, after having forced all the Narew crossings between Pultusk and Ostrolenka,

*For the chronology covering this period, see Page 1221 of this issue.

was temporarily checked, the Russians, by means of their direct Lubin-SiedlceOstrolenka railroad, shifting strong reserves from their southern front (between Josefow on the Vistula and the Bug, east of Grubeschow) to the points of immediate danger in the north. The consequence was that Archduke Joseph Ferdinand's and Field Marshal von Mackensen's armies, which had been held back and at times even forced to yield ground in the first half of July, in the latter part of the month were able to resume their northward advance. Thus the weakening of the Russian southern wing meant the sacrifice of the important IvangorodLublin-Chelm railroad. Great as it was. it had to be made in order to save the northern army from being trapped. The purpose, the protection of the WarsawBialystok road until the greater part of the army of Warsaw could be moved over it to the Grodno-Bialystok-BrestLitovsk front, is now sure to have been accomplished, at least as far northeast as Malkin. Only a small part of this army, that which clung to Novo Georgievsk and the westernmost part of the Narew, as far as its conflux with the Bug, even after the Bavarians had crossed over the Vistula to Praga and after the German army from Pultusk had reached Serozk, was trapped in the region between the Vistula (from Novo Georgievsk to Warsaw) and the Narew, (from Novo Georgievsk to Serozk.)

The Russian line east of Serozk, between that town and the region south of Goworowa, succeeded in tearing itself from the Teutonic grip, gradually changing from a northwesterly front to one facing almost direct west, joining hands in the region southwest of Wyschkow with the troops retreating from War

saw.

Thus the second week of August saw the Russians continuing their eastward retirement on a line running approximately from Novo Minsk over Wyschkow to Wonsewo, (about ten miles northwest of Ostrow,) and from there to Lomza. The pivoting point of the retreating line was the fortress of Ossowetz, northeast of Lomza.

By the 11th of August it seemed reasonably certain that the Russian Army would reach its second line of defense, the Kovno-Ossowetz-Bialystok-Brest-Litovsk line, and later the Kovno-GrodnoBialystok-Brest-Litovsk line, comparatively unimpaired, except for the troops cornered around Novo Georgievsk, when, on Aug. 12, Field Marshal von Hindenburg's left-wing armies under Generals von Scholz and von Gallwitz stormed Lomza and the bridgehead at Wizna, east of the fortress, thereby breaking the Russian line of retreat and endangering the Warsaw-Bialystok road, northeast of Malkin.

As yet up to Aug. 14, no news of an envelopment of any part of the Russian army southeast of Lomza has been received, and it is still possible that the Muscovites will reach their second line of defense in spite of the débacle at Lomza, but their position nevertheless seems precarious, and much, if not all, depends on how near the shelter of the Ossowetz - Bialystok - Brest - Litovsk line was the retiring Russian Army at the time the Teutons broke through Lomza. If it was still in the region of Ostrow and the Bug, from Malkin southeastward, its escape might yet prove not to have been quite as successful as is generally assumed.

While thus the original Russian Narew and Bzura-Rawka armies were fighting their way back over the Warsaw-Bialystok and the Novo Minsk-Siedlce railroads to reach their second line of defense, the armies withdrawn from the region south of the Pilica were struggling to make good their escape to this same line along the only remaining road from Ivangorod to Lukow and Brest-Litovsk, and have apparently succeeded. The Russian strategy here was identically the same as in the north. The retreat over

the Ivangorod-Lukow-Brest-Litovsk road was effected under the protection of the flanking Russian left wing. The latter had meanwhile gradually given way before Austro-German attacks, and by Aug. 6 had established itself along the lower Wieprz, as far as Lubartow, stretching from there through the region north and northeast of Lentschna to the Bug, northeast of Chelm. Assuming the selfsame manoeuvre as the flanking army on the Narew the Russian flanking army at the Wieprz gradually changed its front, in this instance from a southwesterly direction to an almost westerly one. From Aug. 9 on it gradually began withdrawing its right wing northeastward in conjunction with the retirement of the army retreating from Ivangorod and north of the fortress. The front further east followed gradually.

By Aug. 14 the entire southern wing of the Russian Army had retreated to a line extending from Wlodowa over Radin and Lukow toward Siedlce, but not until the army of Ivangorod and that north of the fortress, with the exception of some 10,000 men, 8 cannon, and 20 machine guns taken when the fortress was stormed, had made good its escape. This is plainly indicated by the report that it was the army of General von Woyrisch, advancing from Ivangorod, which took Lukow, and that of Prince Leopold of Bavaria, advancing from Warsaw and south of that city, which took Siedlce, but not the army of Archduke Francis Ferdinand, advancing from the south.

The second part of August thus finds the Teutonic battle front closing in on the Kovno-Ossowetz - Balystok-Brest-Litovsk line advancing on a front forming a semicircle from Wladow over Radin-SiedlceMalkin-Wiznita to Ossowetz. Whether or not greater parts of the Russian Narew army (outside of the troops cut off at Novo Georgievsk) will be captured in consequence of the taking of Lomza on Aug. 12, the next few days will reveal. So far the total of the German booty since the fall of Warsaw has been taken in groups mostly from enemy rear guards and amounts today, as reported, to approximately 35,000 men, 12 guns, and 40 machine guns. Irrespective though of

the yet possible capture of greater Russian units it must be admitted that the retreat of Grand Duke Nicholas's army was carried out in a manner that deserves admiration from friend and foe alike.

Simultaneously with the struggle around the Ossowetz-Brest-Litovsk line, two important campaigns are being waged on the extreme southern and northern wings flanking the second Russian defensive line. In the south the Russian flanking protection is established through the fortified line extending from the lake region (about forty-five miles south of Brest-Litovsk) over Luboml (thirty miles west of Kovel) to the fortresses of Luzk and Rowno. The advance of General von Mackensen's extreme right wing on Vladimir-Wolynski and the fighting for the Bug crossing at Dorogusk (about ten miles west of Luboml) strongly indicate the coming of extended operations against the southern Russian flanking position. Their first object will be Kovel and the road from there to Brest-Litovsk.

Aside from Kovel's importance for operations against Brest-Litovsk from the southeast the possession of that town by the Teutons would also mean the severance of all direct communications between the Russian Galician armies, established along the banks of the Dniester, Zlota Lipa, and upper Bug Rivers, and those operating in Wolhynia and north of that province. Threatening Luzk and Rovno from the flank and the rear, the advance on Kovel would thus, simultaneously with exposing Brest-Litovsk to attack from the rear, force the evacuation of Eastern Galicia by the Russians, to avoid their being cut off from Kiev, the base of operations of all Russian armies south of the Kiev-Kovel line.

While consequently the operations against the Southern Russian flanking position are threatening two entirely different groups of armies alike, all movements against the Russian northern flank, extending from Ossowetz, or in case of the abandonment of that fortress, from Grodno, along the Niemen to Kovno, and from there through the region southeast of Ponevyezh to that west of Jacobstadt toward the Dwina, are simply

directed against the one main breadline supplying the new Russian defensive line -the Wilna-Dunaburg-Petrograd railroad. If the Teutons here can break the wall protecting it, the Grodno-BrestLitovsk line will become untenable.

It is in realization of this fact that the Russians have lately made the most desperate efforts to resume the offensive in this northeastern seat of war in order to drive back the menacing projection of the northern Germanic flank. The latter on its part is protected in its extreme left by a flanking army advancing on Riga parallel to the Aa River front as far south as the region southwest of Friedrichstadt. It is against this army that the Russians have launched their main attack. On the 11th of August they succeeded in driving it back over the Aa River, southwest of Mitau. A further advance would have brought the attacking forces into the rear of the German Kovno-Dunaburg front, and would have placed it in a precarious position. Simultaneously with their attack south of Riga the Russians began to press back the German front in the section west of Jacobstadt and southwest of Ponevyezh. But already on the 14th the Russian advance was everywhere checked, and on the 15th Berlin reported the "developments of new battles," (the German term indicating the coming of a vigorous offensive movement) on the entire Dunaburg-Kovno front, and progress at the latter fortress, commanding the most direct and easiest approach to the Bialystok-Petrograd railroad at Vilna.

At the same time come reports of the evacuation of Bialystok and Vilna by their civil population and of Riga by the British authorities there. They are boding ill for the Czar's cause.

While this gigantic struggle has been going on, little, if any, fighting of importance has taken place in France and West Flanders during the last four weeks. Worthy of note are only the following three actions: The third week of July found the French launching an energetic offensive in the Vosges, where they succeeded in pushing their lines about half a mile further west and northwest along the valley of the Fecht. In the region

of Münster, however, by the end of July they were definitely checked in their attempt to extend their foothold in Alsace.

The second action, taking place in the Argonne, was begun early in August on German initiative, the Crown Prince forcing his front between Four de Paris and Varennes forward a little less than a mile, and in co-operation with this offensive pressing the French by a sharp attack southeast of Verdun from the region of Les Eparges, the object of both movements being to draw tighter the semicircle around Verdun, closing in on the fortress from the northwest and the southeast. The movement in this seat of war may possibly be regarded as preparing for a more vigorous campaign here after that in Russia has been brought to a close, and it may also be of moral influence, giving evidence of the great German strength, making possible the carrying on of an offensive on two fronts simultaneously, but the actual results attained around Verdun in the last four weeks are negligible.

The third scene of hard fighting was in West Flanders in the region of Hooge, (due west of Ypres,) where the Germans in the first days of August delivered a vigorous surprise attack, driving the British from the village and taking several of their trenches. But already on Aug. 10 the British launched their counterattack, which regained Hooge and their trenches with the exception of those south of the village.

Since Aug. 10 the situation here, too, has again been deadlocked, as all along the rest of the western front.

On the Austro-Italian front the first general Italian offensive on the Austrian positions during June had had for its object Garizia, the key to Trieste. The principal attacks had been directed against the Austrian position at Plava dominating the approach to the city from the north, and that at Doberdo, flanking Gorizia to the south. Simultaneously vigorous frontal attacks also had been launched against the bridgehead at Gorizia. By the end of June all these assaults

had seemed insufficient. A reorganization of the Italian attacking forces took place and July 15 marked the beginning of the second big offensive. This time the main onslaught to break the Austrian Isonzo front was apparently directed further north toward the region of Marlborghetto and Tolmino, its object being the valleys of the Drave and Save, east and southeast of Tarvis, the possession of which would cut the entire Austrian Isonzo front off from all direct communication with Vienna and the northeast generally. The attacks on the Plateau of Doberdo and the position near Canale during the first week of August are therefore more in the nature of feint offensives.

On Aug. 14 came the report from the Italian General Staff that "pending consolidation of positions taken no new attacks would be made. In view of the fact that the Austrian front was then nowhere broken, this report can but mean an admission that the second big Italian offensive on the Isonzo front has suffered the fate of the first.

The Italian operations on the Tyrolese frontier, where the early part of August has witnessed fighting principally in the region of Condino, to the southeast of Roverto, and in the Cadore Mountains, are merely of a defensive character, aiming purely at frustrating Austrian counterattacks from the north, menacing the rear of the Italian operations on the Isonzo.

Thus, as in France, the middle of August finds the situation on the Austro-Italian front temporarily deadlocked.

In the Dardanelles and on the Serbian frontier the situation is likewise unchanged since July 15. In the former field of operations the Allies have landed additional troops, and have again assumed a vigorous offensive, but the results have yet to be reported. It would appear, of course, that the recent allied activity on Gallipoli is a political movea bid for support from the Balkan States, on whose possible help the allied powers seem to have high hopes.