The Sun.
London, England, 1866-06-09 00:00:00

SPIRIT OF THE PUBLIC JOURNALS,

TIMES.--There arc, probably, many sharehold-rs
as well as many creditors of Overend, Gurney, and
Co. (Limited) who will learn for the first time from
the provisional report of Messrs-. Turquand and
Harding what they ought to have ascertained be-
lore investing or lending their
_money.
cursory perusal of this docunce-ne is suffident-to---
show not only that no considerable portion of the
paid-up capital will ever be recovered, but that no
company ever ought to have purchased the concern

at all. The truth is that Messrs. Overend and Gur-
ney had not a sound business to dispose of on the
31st of July last, and, instead of receiving £500,000
for the goodwill of it, should have been thankful to
pay a handsome sum to any company which should
take it off their hands. The position of the old firm
at this time is clearly indicated in the supplementary
statement issued by the official liquidators, which is
the real key to the subsequent history of the com-
pany. " The total on the credit side of the account
then stood at £15,552,003, and on the debit side at
£14,425,678, exclusive of the balance to the credit
of the partners in the private ledger, amounting to
£1,126,325." There were, however, further liabili-
ties of various kinds to the extent of nearly£9,ooo, 000
more, which seem to have been excluded from the
debit side of the account because they were contin-
gent on the default of other houses which were pre-
sumed to be solvent, or because they were otherwise
supposed to be covered by adequate securities. It
was hoped that ample provision had been made
against any losses, arising from bad debts or other
causes, by the apparent difference of more than
£1,000,000 between liabilities and assets, by the
balance in the private ledger already mentioned,
and by the value of the separate estates of the
partners. Unfortunately, this expectation has
proved quite illusory. A deficiency has arisen,
" from depreciation in values and from other
lellleas as t
causes,"
£700,000,a
which f
te is r
several, shall have been realized. Though it is not
allliktehlye t°
assets, amount
jointio as at
r
very easy to follow this part of Messrs. Turquand
and Harding's report; wegather from it that whereas
the partners of the old firm have already contributed
about £659,000 towards a guarantee fund out of
their private estates, and will have to contribute
£1,250,000 more, yet the demands upon the new
company have been such as to absorb the whole of

and to leave a deficit of £700,000. If we now
turn to the " approximate statement of the affairs
of the company in liquidation," we find assets osten-
sibly exceed liabilities by about £400,000, and this
is the sum which, subject to much certain delay and
many probable deductions, the shareholders ought
to get back out of their lost £1,500,000. The ex-
perience of the official liquidators, however, enables
them to point out a number of 'possible slips between
the cup and the lip which might scarcely have oc-
curred to the uninitiated. They warn all parties
concerned at the outset that "at the present time
the most carefully framed estimates may prove fal-
lacious." This is just one of those paradoxes which
Lord Dundreary might be pardoned for saying that
" no fellow can understand," but which is really
very simple if we only look at it only in detail. For
instance, the largest item in the liabilities of the
company is " to liability on bills rediscounted
£8,266,048," and another large item represents
debts to persons holding security. Now, it is obvi-
ous that in the former case much t:epends on the
ability of other firms to pay the bills in full as they
arrive at maturity, and that, in the latter, the com-
pany may either realize a surplus or be called on to
make good a loss, according as the realized value
of the security exceeds or falls short of the
creditor's claim. In the present " very excep-
tional state of commercial affairs," Messrs. Tur-
quand and Harding decline to pledge themselves
to any definite opinion as to the propor-
tion of bills which may be returned unpaid. They
express a belief that the character of those held by
creditors as security is, on the whole, good, but they
remind the shareholders that interest is payable on
them, and must be subtracted from the surplus of
£266,000, which might otherwise be expected to
accrue from them. They predict, on the other
hand, that " a large amount of the bills " redis-
counted" will be thrown back on the Company,
and will, "in the first instance, rank against the
estate for the full amount." We have here one
secret of commercial failures, and an intelligible
answer to the question so often asked of late—
" Where does the money go ?" The money goes in
loam, at high rates of interest, to contractors and
companies who may ultimately be able to repay it,
but who cannot repay it at short notice. It is locked
up in works that.require years for their completion,
and, for the purpose of meeting a sudden call, it
might just as well be at the bottom of the sea.
There is one sentence in the report before us that
explains in a few words the reason why firms of the
highest credit, but which have tampered with the
new system of financing, may collapse at any mo-
ment, without any premonitory symptoms of weak-
ness. They have assets, and they have liabilities,
and they have, let us suppose, carefully preserved a
due relation between them, " but in many instances
the former can only be realised with time, whereas
the latter require prompt payment." 1 hen money
has to be borrowed at any sacrifice, credit breaks
down, and the inevitable fate of the house that is
built on the sand overtakes the concern, not, per-
haps, because it is intrinsically rotten, but because
the pressure upon it is present and the means of
resistance prospective. If it.be true that a profit
of more than £200,000 was fairly earned by the
limited Company of "Overend, Gurney, and Co."
during the nine months of its existence,
we must attribute its failure chiefly to em-
barrassments of this kind, inherited from the
old firm. It would have bad a far better
chance of success had it started without the
goodwill for which it paid £500,000, but with a clear
balance-sheet ; as it was it could hardly have
weathered the storm of last month, even had the
" bears " not conspired to undermine it. The . case
of the Agra and Masterman's Bank, in which the
families of so many Indian officers had invested their
savings, appears to have been very different. There
is every reason to believe that, although its 1:11107
may have been precipitated by the downfall_directl v
Overend and Gurney, yet that
itl twors who
brought about by unprincipled speculators infamous
had
made time bargains upon its shares. I
practice has of late been carried to,suc.hdengthsneraso
to shock even the conscience of the
Article of yes-
ock-E xch.t
Au instance mentioned in our
manner in which it isu r City
terday will serve to show the
carried on. A gentltemnainair,s-hoßalinakd,aniliadrgwerhdoephoaspi-t
iu the Agra and
the Louvre Hotel in Paris,
to proceed from a dis-
interestedpened to be resid3inlasaetr
received a letter, purporting orting
lent, warning him to withdraw
correspondent,
the money at once, as the bank was in imminent
ulna
tcle thusfor to a
Of course, the real motive was to get up a
peril.
general panic, to depreciate the shares,,lspec
enable stock-jobbers who had
fall" to make a fortune by purchasing, for next to
nothing, shares which a few days back commanded
a good price. Now, we do not here deny that it
may be legitimate for a man to contract for the sale
of what he has not in his own possession, in the hope
of turning a profit by the chance of its' falling in
value before the time comes for its delivery. This
may be an honest trade, but it certainly exposes
those who engage in it to great temptations. From
the moment that such a transaction is concluded it
becomes the direct interest of the seller to " bear

the market," by persuading
withdraw deposits, and if
than ihe Worst of his neigh
falsehood to promote that
that a representation has . -Se
Committee of the Stock Exchange on this subject,
for not even the stability of well-established firms
can be proof against such operations, if conducted
on a scale of such magnitude. It is for those who
are familiar with stock-jobbing transactions to dis-
cuss the expediency of making any contract for the
sale of shares void at law where their numbers have
not been specified in writin,. It is our duty to point
out that, unless some remedy be adopted, the Lon-
don Stock-Exchange will soon acquire a shameful
notoriety in Europe.
POST.—If a nation does not sometimes attempt to
explain its conduct, and the circumstances e•uilinfr
to it., there is risk that it will be misjudge,' by pos'-
terity, while it undoubtedly permits a bastlesa
irritation against it to become permanent with some
colour of justification. The bearing, of this country
during the American civil war is open to be mis_
interpreted in numercus ways. Our Ministers spoke
their minds out freely on the subject—perhaps too
freely. The press and the country were equally
unrestrained in their expressions; one portion sym-
pathised with the North, another with the South ;
but an all but general feeling. existed that the
Union had received a mortal blow, and not only
was that the opinion in England, but the wisest
heads of the Continent of Europe held the sama-
view. We can justly say of ourselves that this
opinion was formed from no spirit of opposition to
the Americans or their -institutions. On the con-
trary, we looked upon the strife, and forecast what
we supposed to be its certain issue, with grief. To
us the war was a personal calamity. It appeared
to be one of those tremendous convulsions which
come once in an age to herald a new order of
things. For years the cause of disunion had been
distinctly traced. We beheld the South rising as
one man, inspired not only with patriotism, but
with the utmost vindictiveness, towards their former
brethren. Such a vindictive hatred appeared in
itself to be a frontier line of division between the
opponents, That we did not estimate correctly
either the resources or the tenacity of the great
Western people and their noble representative,
Abraham Lincoln—the representative of their
energy, their simple firmness, their downright
courage—is now very plain to us all. IVe were
mistaken. IVe have learnt what the Americans
' but of which we were previously igno-
-rrat we were both' Ana,,quainted with the cha-
racter of the Ahieriea- n institikioJ.s anil the Americans
themselves. That is our offence plainly stated. It
rAesstreorrf
atrlics
the Union, we risrea-s
iguilty
oafs whichors vtal
fer to see it intact. Akin though we are
to the Americans in blood' an I in language,
it is natural that we should not entertain
any of that profound sentiment for the Union
which animated them Worthily during their
tremendous struggle. Historical precedent
led us to presuppose that it must fall to pieces ;
and probably the shrewdest divination was
exercised by those Germans of small means and
large faith who invested their savinsinrelooked
American
securities at a time when " greenbacks" were
on doubtingly ; for these Germans trustedtoto their
instinct, and instinct was the only relything
upon at that period. The very fact that reason
was then so poor a counsellor should teach the
Americans to be charitable in their judgment of
'the feelings and intentions of those who misap-
prehended the issue of their difficulties. We
appeal to Mr. Bancroft to reconsider his charge
against us. He may discover a confirmation
of it in the utterances of Ministers and humbler
men in England, and it will not the more be true.
We demand to be judged by the spirit of our acts.
Mr. Bancroft pleads his case too much in the
manner of a lawyer ; he supports himself on the
letter of his text ; he does not take into con-
sideration the astounding and unexampled nature
of the convulsion, with its varying results, which
we were called upon to witness during a space of
four years. For four years the Confederates were
not only active belligerents, but ordinarily suc-
cessful. They bad famous generals and great
armies. Nothing better than the words of Tacitus
can describe that war. There had never been any-
thing like it upon the earth before :—" Diversa
omnium, qua uuquam accidere, civilium armo-
rum facies. Non przelio, non adversis castris, sed
iisdem e cubilibus, quos simul vescentes dies, simul
quietos nox habuerat, discedunt in partes, ingerunt
tela ; clamor, vulnera, sauguis palam." Such a
picture, on a vastly multiplied scale, was pre-
sented by this mighty war, and we can only
not say, in addition, what was applicable to the
disordered camp of Germanicus—causa in occulto.
The cause was evident. North Americans,
however, who tell us now that they fought
for slavery, and received evey discouragement
from us in. their struggle, must not forget that
Union was the foremost word on their banner.
Slavery was the origin of the war ; but when we
ask whether it was for slavery or Union that the
War Was-ilo doggedly prosecuted; we fancy that au
honest answer would not accord to it that purely
ideal dignity of character ani benevolence of de-
sign in which Americans are beginning to regard it.
That there was much self-sacrifice on their part to
do justice to themselves and humanity is incontest-
able, and as the war advanced, and they began to
feel their strength, their sentiments grew clearer.
As soon as they felt certain of the Union they de-
termined to eradicate slavery ; but in the period of
doubt, during the heat of the conflict, they did not
produce the impression on any foreign nation that
the eradication of slavery was their principal object.
It is to this fact that we wish to draw their attention,
that they may be just. The hereditary animosity
towards the mother country which Americans
supposed to exist among themselves has really no
existence. The idea of it sprang from a conscious-
ness of strength and a spirit of rivalry, and perhaps
some recollection of old wrongs. But that recol-
lection at any rate should be put aside now that they
have had experience of the trials of government;

nor can the rivalry endure after the display of their
strength, which created admiration and amazement as
a thing unexampled in the world's history.

THE "ANGLO-AMERICAN TrmEs."—We

ticed Last week in our editorial columns the ex-
traordinary number of Americans whose arrival
we recorded at the various English ports. The
names of these travellers took up a consider--
able part of our space, while the registers of the
different hotels showed how large the number wan
already in this country. We rejoice to welcome
Americans to the shores of England, for nothing
tends more to the removal of prejudice than

;ravel, and to cement friendship than -personal in-
ercourse. If as many English travellers landed

in America, we would not despair of soon seeing the
day when these two ()Teat nations would more justly
appreciate each other, when misconceptions and
and respect
awntichillloaanpern
in-
fluence, and when the good-cow
jealousies would cease to have s
should exist between them
u not easily be dis-
turbed. The facilities' affordedd, to the people of
this kingdom by railroads
continental Europe have
steamboats of visit-
ingthe English character. ave materially affected
Probably there was no
more bigoted person in creation than a John Ball
of the last generation. Then the grand tour was
only within the means of the wealthy—now it can
be accomplished by those comparatively poor. Even
the workmen of Paris and London exchange visits,
and the effectof ' this frequent intercourse is strikingly
apparent. France and England formerly hated
each other with a deadly animosity—now they find
interests in common, and more profitable and
agreeable pursuits than cutting each other's throats.
It is not at present a general belief in France that
the gross, drunken, over-fed John Bull brings
the wife he wishes to discard to market, with a
rope round her neck, and disposes of her for half-a-
crown ; nor do the English believe that all
" Johnny Crapauds " wear wooden shoes, play
the fiddle, and dine on toads. Though the English
Channelis not the Atlantic Ocean, yet the increasing
number of magnificent steamships plying betweenthe ports of England and America practically'' „
duces the voyage to a trifle, as well in time,res ;„-
cost. These facilities for intercourse
cost.
will tell in the
end ; and we repeat that the day
lookedfor when there will be fewerelements may be soon
to the peace of these kindred nations, of danger
and prejudice of their respective in the ignorance
wealthier classes of populations. The
greater numbers than Americans visit England ' far
greater
in
the Entrl• h
and have consequently,„ is visit Americe
than the same
more knowledge this "
of coun-
tryclass
In-
deed, before the le. t here have of America. a ,e war the
profoundly i people of England were
y ignorant of
sociLt y, and c the constitution, politics,
society
great yen geography of the United States.'
events to which
that war gave rise com-
manded the
attention of the world, and enforced on
these classes the /p
with necessity of making there:yes ac-
quainted
__ _

611 M.P. who did not know whether Minnesota was
a town or a State, or t Ch.eago a State or a town,
would flippantly deliver an opinion on a profound
subject of American politics ; and a writer who re-
garded Tennessee as an English county, would
comment on the blunders of an American general.
In Washington a Senator would denounce in un-
measured terms the vile conspiracy of the whole
British nation against the liberties and con-
stitution of his country, with :un more ground
than an article in the London Times afforded him.
Happily, this prejudice is daily passing- away;
and if we .cannot get a larger portion of English
travellers to go to America, we trust at least that
the Lmericau travellers now visiting these shores
may be mesbengera of peaoo and good-will.