received from time to time, that early estimates of a total cost for the war of fifteen billions of dollars for one year were not excessive. As the war has already lasted six months, there is little doubt that at least this sum would be consumed, even if peace should be made soon, because the armies could not be immediately disbanded and large contract obligations would, for some time, have to be met.
The amount usually available for investment in securities having a general market is shown by the computations of the Belgian financial publication, Le Moniteur des Intérêts Matériels, to be about $4,000,000,000 per year. This does not represent the entire sum of savings applied to the improvement and extension of private enterprises, some of which is represented by securities which are closely held, and some of which does not take the form of securities at all.
In dealing with the question how large a proportion of the total fund of capital available for investment will be absorbed by war loans, and how much can be diverted to its old mission of building up and extending the machinery of industry, there are many factors to be considered on both sides of the problem. Undoubtedly the patriotic spirit of the peasant, the mechanic and the small shop-keeper in France, Germany and England will lead them to dip into their little hoards of actual currency and other savings to make subscriptions to the national loans in amounts which would not be applied ordinarily to the purchase of railway and industrial issues. Undoubtedly, also, many sums which would be applied to improving and extending the facilities of the farm, the tool-box and the shop, will be applied to the purpose of saving the national credit and meeting the public obligations. From these sources will come considerable amounts which will be added to the net fund available for investment.
On the other hand, it can not be assumed that the entire amount which is available for investment will be applied to the new public loans. Where new capital issues are made essentially for keeping pace with industrial development, for enlarging mills whose product is in increased demand, and especially for meeting the growth of equipment for new population in the countries which have not been decimated by war, considerable sums will be applied to investments other than the national loans. This will be especially true of those small and closely-held corporations whose securities are distributed among the original holders and where the direct profit on the output makes the market rate for money a factor more or less negligible.
What part the railways will be able to play in wresting a portion of the world's savings from the outstretched hands of the powers which have been blowing away thousands of millions in powder and ball, becomes an interesting consideration. They must come into the open market and bid against the greatest states in the world for some scanty portion of the supply of investment capital.