manner. (Cheers.) There still remains the vital need for men to fill the ranks of our Armies, and it is to emphasize this point and bring it home to the people of this country that I have come here this afternoon. When I took up the office that I hold, I did so as a soldier, not as a politician-(loud cheers) -and I warned my fellow countrymen that the war would be not only arduous, but long. (Hear, hear.) In one of my earliest statements made after the beginning of the war I said that I should require "More men, and still more, until the enemy is crushed." I repeat that statement today with even greater insistence. All the reasons which led me to think in August, 1914, that this war would be a prolonged one hold good at the present time. It is true we are in an immeasurably better situation now than ten months ago-(hear, hear)—but the position today is at least as serious as it was then. The thorough preparedness of Germany, due to her strenuous efforts, sustained at high pressure for some forty years, have issued in a military organization as complex in character as it is perfect in machinery. Never before has any nation been so elaborately organized for imposing her will upon the other nations of the world; and her vast resources of military strength are wielded by an autocracy which is peculiarly adapted for the conduct of war. It is true that Germany's long preparation has enabled her to utilize her whole resources from the very commencement of the war, while our policy is one of gradually increasing our effective forces. It might be said with truth that she must decrease, whilst we must increase.

It would be difficult to exaggerate the value of the response that has been made to my previous appeals, but I am here today to make another demand on the manhood of the country to come forward to its defence. I was from the first unwilling to ask for a supply of men in excess of the equipment available for them. I hold it to be most undesirable that soldiers, keen to take their place in the field, should be thus checked and possibly discouraged, or that the com

pletion of this training should be hampered owing to lack of arms. We have now happily reached a period when it can be said that this drawback has been surmounted, and that the troops in training can be supplied with sufficient arms and material to turn them out as efficient soldiers.

When the great rush of recruiting occurred in August and September of last year, there was a natural difficulty in finding accommodation for the many thousands who answered to the call for men to complete the existing armed forces and the New Armies. Now, however, I am glad to say we have throughout the country provided accommodation calculated to be sufficient and suitable for our requirements. Further, there was in the early autumn a very natural difficulty in clothing and equipping the newly raised units. Now we are able to clothe and equip all recruits as they come in, and thus the call for men is no longer restricted by any limitations, such as the lack of material for training.

It is an axiom that the larger an army is, the greater is its need of an everswelling number of men of recruitable age to maintain it at its full strength; yet, at the very same time the supply of those very men is automatically decreasing. Nor must it be forgotten that the great demand which has arisen for the supply of munitions, equipment, etc.. for the armed forces of this country and of our Allies also, as well as the economic and financial necessity of keeping up the production of manufactured goods, involves the retention of a large number of men in various trades and manufactures, many of whom would otherwise be available for the Colors. In respect of our great and increasing military requirements for men, I am glad to state how much we are indebted to the help given to the Recruiting Staff of the Regular Army and to the Territorial Associations throughout the country by the many Voluntary Recruiting Committees formed in all the counties and cities, and in many important boroughs for this purpose.

The public has watched with eager interest the growth and the rapidly ac

quired efficiency of the New Armies, whose dimensions have already reached a figure which only a short while ago would have been considered utterly unthinkable. (Cheers.) But there is a tendency, perhaps, to overlook the fact that these larger armies require still larger reserves, to make good the wastage at the front. And one cannot ignore the certainty that our requirements in this respect will be large, continuous, and persistent; for one feels that our gallant soldiers in the fighting line are beckoning, with an urgency at once imperious and pathetic, to those who remain at home to come out and play their part too. Recruiting meetings, recruiting marches, and the unwearied labors of the recruiting officers, committees, and individuals have borne good fruit, and I look forward with confidence to such labors being continued as energetically as hitherto.

But we must go a step further, so as to attract and attach individuals who from shyness (laughter) or other causes- -(renewed laughter)-have not yet yielded to their own patriotic impulses. The Government have asked Parliament to pass a Registration Bill, with the object of ascertaining how many men and women there are in the country between the ages of fifteen and sixty-five eligible for the national service, whether in the navy or army, or for the manufacture of munitions, or to fulfil other necessary services. When this registration is completed we shall anyhow be able to note the men between the ages of nineteen and forty not required for munition or other necessary industrial work and therefore available, if physically fit, for the fighting line. Steps will be taken to approach, with a view to enlistment, all possible candidates for the Army-unmarried men to be preferred before married men, as far as may be. (Loud cheers.) Of course, the work of completing the registration will extend over some weeks, and meanwhile it is of vital and paramount importance that as large a number of men as possible should press forward to enlist, so that the men's training may be complete when they are required for the

field. I would urge all employers to help in this matter, by releasing all men qualified for service with the Colors and replacing them by men of unrecruitable age, or by women, as has already been found feasible in so many cases.

When the registration becomes operative I feel sure that the Corporation of the City of London will not be content with its earlier efforts, intensely valuable as they have been, but will use its great facilities to set an example of canvassing for the cause. This canvass should be addressed with stern emphasis to such unpatriotic employers as, according to returns, have restrained their men from enlisting.

What the numbers required are likely to be it is clearly inexpedient to shout abroad. (Hear, hear.) Our constant refusal to publish either these or any other figures likely to prove useful to the enemy needs neither explanation nor apology. It is often urged that if more information were given as to the work and whereabouts of various units, recruiting would be strongly stimulated. But this is the precise information which would be of the greatest value to the enemy, and it is agreeable to note that a German Prince in high command ruefully recorded the other day his complete ignorance as to our New Armies. (Laughter and cheers.)

But one set of figures, available for everybody, and indicating with sufficient particularity the needs of our forces in the field, is supplied by the casualty. lists. With regard to these lists, however-serious and sad as they necessarily are-let two points be borne in mind, first, that a very large percentage of the casualties represents comparatively slight hurts, the sufferers from which in time return to the front; and, secondly, that, if the figures seem to run very high, the magnitude of the operations is thereby suggested. Indeed, these casualty lists, whose great length may now and again induce undue depression of spirits, are an instructive indication of the huge extent of the operations undertaken now reached by the British forces in the field.

W

ITHIN the last ten months contracts for war supplies estimated to exceed $1,000,000,000 have been placed in the United States.

When war was declared last August this country was suffering from acute industrial depression; many factories shut down, others operating on short time, and labor without employment. After the paralyzing effect of the news that war was declared had worn away, business men here realized the great opportunity about to be afforded them of furnishing war supplies which must soon be in demand. Their expectations were soon fulfilled, as almost immediately most of the Governments sent commissions to the United States. Some had orders to buy, while others were authorized to get prices and submit samples.

It was not long until mills and factories were being operated to capacity, turning out boots and shoes, blankets, sweaters, socks, underwear, &c. The manufacturers of these articles were merely required to secure additional help in order to increase their plants' production.

The situation was different in relation to filling orders for arms and ammunition. At first, as was natural, this business was placed with concerns engaged in the manufacture of these commodities. Shortly they were swamped with orders, and to be able to fill them plants were enlarged, new equipment added, and additional help employed.

More and more orders came pouring in, and, as the arms and munition houses were by this time up to and some over capacity, acceptance by them of further business was impossible. Here, then, was the opportunity for the manufacturers of rails, rivets, electrical and agricultural

machinery, locomotives, &c., to secure their share of this enormous business being offered. The manner in which they arose to the occasion is striking testimony of the great resourcefulness, efficiency, ingenuity, and adaptability of the American manufacturer.

The question of labor was of minor importance, due primarily to the fact that many thousands of men were without employment and anxious to secure work, and secondarily for the reason that skilled labor was not an essential factor. Most of the work is done by machinery and in a short period of time a mechanic of ordinary intelligence will become proficient in running a machine. The necessary trained labor could be secured without difficulty. Numbers of highly trained employes at Government arsenals are now with private arms and ammunition concerns. The labor problem therefore was negligible. However, three serious difficulties had yet to be overcome by the manufacturers wishing to engage in this new line of business—the securing of new machinery, raw materials, and capital.

The larger concerns had machinery and apparatus on hand suitable to most of the work, but much new machinery was needed, especially for the manufacture of rifles, and needed in a hurry. Time is the essence of these war supplies contracts, and, as many manufacturers agreed to make early deliveries, it was up to them to secure this new machinery and have it installed without delay; otherwise they could not manufacture and make deliveries as agreed to.

In this event they would suffer the penalty for non-fulfillment, as stipulated in the bond given by them to the purchaser at the time of signing the contract. These bonds are known as "ful

fillment bonds" and are issued by responsible surety companies, usually to the amount of 5 per cent. of the total contract price, on behalf of the vendors, guaranteeing their deliveries and fulfillment of the contract.

In the earlier stages of this war supply business the question of his ability to secure raw materials with which to manufacture arms and ammunition or picric acid this latter being used to manufacture higher explosives-was of no great concern to the manufacturer taking an order; but as orders came pouring in from abroad for ever larger amounts of supplies it was clearly evident that the demand for raw materials would shortly equal, if not exceed, the supply thereof. This condition was soon brought about, and today is one to be most seriously reckoned with by the manufacturer before accepting a contract.

Some of the materials needed with which to manufacture the supplies are mild carbon steel for the barrels, bayonets, bolt, and locks; well-seasoned ash or maple, straight-grained, for the stocks; brass, iron, powder, antimony, benzol or phenol, sulphuric acid, nitric acid, and caustic soda, &c. Of these various materials the most difficult to secure are those used in the manufacture of picric acid.

Today it is almost impossible to secure phenol, certainly in any considerable quantities, and it is almost as difficult to secure sulphuric acid and nitric acid. Germany has been the source of supply in the past for picric acid. Before the war it sold around 35 cents to 40 cents per pound, dry basis; recently it has sold at over $2 per pound for spot, that is immediate delivery, and is quoted at from $1.25 to $1.60 per pound for early future deliveries.

Antimony is becoming so scarce, never having been produced in any great quantity in this country, that in the new contracts being submitted for shrapnel shell it is stipulated that some other hardening ingredients may be substituted in the bullets, either totally or partly replacing the antimony.

Brass is essential to the manufacture of cartridges. The term "brass" is com

monly understood to mean an alloy of copper and zinc.

Up to a short time ago electrolytic copper was selling at 20% cents a pound, lead at 7 cents a pound, commercial zinc at 292 cents a pound. Zinc ore, from which spelter is obtained, reached the price of $112 a ton. American spelter was nearly $500 a ton, compared with $110 a ton before the war. Spelter was almost unobtainable. In England the situation was acute, the metal there being quoted only nominally at around $550 a ton for immediate delivery.

Within the last few days prices have dropped materially, but how long they will remain at these lower levels it is impossible to predict. If the war continues for any length of time the demand for all these metals is certainly bound to increase, and this will automatically again send up prices.

The world's production of spelter in 1913 (the latest authentic figures obtainable) was 1,093,635 short tons. Of this the United States produced 346,676 tons, or 31.7 per cent.; Germany, 312,075 tons, or 28.6 per cent.; Belgium, 217,928 tons, or 19.9 per cent.; France and Spain, 78,289 tons; and Great Britain, 65,197 tons. The world's production of spelter in 1913 exceeded that of 1912 by 25,590 tons, or 2.2 per cent. The greatest increase was contributed by Germany, which exceeded its production of 1912 by 4.4 per cent. The United States made a gain of 2.3 per cent. The excess of the world's production over consumption in 1913 was only 27,316 tons.

As can be seen from the above figures, Germany has control of practically onehalf, possibly now over one-half, of the world's production of spelter. Her position with respect to iron and coal is equally strong, the United States not included. In 1913 Germany's production of pig iron was 19,000 tons; Great Britain, 10,500 tons; France, 5,225 tons; Russia, 4,475 tons; Austria and Belgium, over 2,000 tons each; Italy, negligible. She has captured a large proportion of the coal resources of France as well. Her strength is her own plus that of conquered territory.

Before a contract for war supplies is let, more particularly with reference to contracts for arms and ammunition, the manufacturer is requested to “qualify.” This means he must show his ability to "make good" on the contract he wishes to secure. If he is now or has been in the past successfully engaged in the manufacture of the particular article in question, this is usually sufficient; if it is out of his regular line, then he must prove to the satisfaction of the War Department or the purchasing agent, as the case may be, that he has the technical knowledge necessary for its production. In either event he must have an efficient organization, suitable plants, with proper equipment and men to operate same; also the necessary raw materials in hand or under option to purchase.

In most instances the manufacturer taking these war orders has been obliged to enlarge his plants, add new machinery and purchase raw materials so as to be able to handle the business. This meant the expenditure of large amounts of money on his part.

He did not have to depend, however, upon his own normal financial resources, as the contracts carry a substantial cash payment in advance, usually 25 per cent. of the total contract price. This advance payment is deposited in some New York bank simultaneously with the manufacturer's depositing a surety bond guaranteeing his deliveries, and upon the manufacturer executing an additional surety bond guaranteeing his responsibility he could draw down all or any part of the cash advance he might wish to use for his immediate needs.

Before issuing these bonds the surety companies make rigid examination as to the ability of the manufacturer to fulfill his contract. The commission charged for issuing these bonds is from 2% to 5 per cent. on the amount involved. The demand for bonds has been so great during the last six months that it has taxed to the limit the combined resources of all the surety companies in the country.

The remaining part of the contract price is usually guaranteed by bankers' irrevocable letters of credit or deposits

made with New York banks, to be drawn against as the goods are delivered, f. o. b. the factory-that is, free on board the cars or f. a. s. the seaboard-that is, free alongside ship-as the terms may provide.

Banks here are beginning to purchase bank acceptances or bank-accepted bills of exchange, and in this manner payment is also being made to American manufacturers for goods sold to the Allies. For example, when a purchasing agent in Paris places an order for ammunition here he makes arrangements whereby the manufacturer will be authorized to draw on a New York banking institution at a stipulated maturity, and after acceptance of his drafts by such banking institution he could then negotiate these time drafts with his own banker-thus making them, less the discount, equivalent to cash-through whom they could be rediscounted by the Federal Reserve banks. These bank-accepted bills are discounted at a nominal rate of interest.

Before the war we were a debtor nation; today we are rapidly becoming, if we have not already become, a creditor nation. A year ago we were selling abroad only about as much goods as we were buying; now the balance of trade is greatly in our favor, due to the enormous export of foodstuffs and war supplies of all kinds. Monthly our exports are exceeding our imports by many millions of dollars. This indicates that foreign nations are going into debt to us.

At the time of writing this article foreign exchange was quoted as follows: London exchange, sterling, 4.762; Paris exchange, franc, 5.45%. By paying down $4.762 in New York you can get £1 in London, which on a par gold basis is equivalent to $4.86 in London. By paying down 942 cents in New York you can get the equivalent to 100 cents in Paris.

We now come to another interesting phase of this war supply business, namely, how some persons thought these war orders could be secured and how they are actually being placed. Almost immediately after the declaration of war, most of the belligerent Governments dispatched commissions" to the United