The New York herald. [volume] (New York [N.Y.]) 1840-1920, 1854-08-26
The Commercial Prospects Of 1854 and
1855.

all KINDS IN new / 0f8 Since August, 1000, CaH-
net be set down at 10 than Ii rty-three per
cent on the tota' valu. thereos. The question
now il, has the de recist on en- 'ei ?-hsve we
seen the worst o. The panic, the II n stocks,
and tie d. cline in tn value Of real estates
On tie solution OF h question depends the
commercial prosperity Of the whole country,
and as a necessary consequence the well-being
Of the greater part Of the American people.
The extent and duration Of comm -rcal dis
asters are in exact pr portion 30 the character
OF their causes A crisis provoked by q sud
den outburst Of war, or other fortuitous disas-
ter is one to be speedily followed by reaction.
A crisis Induced by a long course Of CONNER
cal error, such Is an snsound currency, is
likely to last for some time and to fhake trade
to its basis. The causes Of our past suffering
and present jeopardy are obvious. We class
them under five heads:--1. The California
gold which induced over speculation, ovcr-ial-
portatiop, and raised the price of real estate
and other commodities in disproportionste
degree: 2. The mania for building railroads,
which has led to the absorption III these enter.
prises OF capital required for other and more
essential branches Of industry, and has fos-
tered q system OF fraudulent 6naaciering
among railroad managers 3. The war
in Europe, which has operated, indirectly
by closing the European markets to our secu-
rites, and awakening o wide spread want of
confidence in the future 1. The general ex-
travagance of living among our mercantile
classes: and 5, various local causes, such as
the prospect Of a short crop in some of the
staples, the cholera, the discovery of colossal
frauds by leading iinanciers, &c. All Of these
causes have we believe operated in q certain
degree to produce the present state of things
The crisis of 1887 was primarily induced by
agencies included In the above, namely, owe :
speculation, and extravaganza; bat it had
feature which is wanting now. The disaster If
1887 was fearfnlly aggravated by the removal
of the deposits from the United States Bank
and the utterly insecure condition of the cur
rency the majority Of our banks al present are
comparatively safe, and those which are rot
safe have already fallen under the ban OF dis
credit. Even if a worse period than the pre-
sent should compel the free banks to suspend,
their assets could not fall far below their is
sues and it is TO be hoped that the eastern
banks win make provision to guard against
run upon their funds The wild cat banks are
advertised at every corner, and it is the fault
Of the public If they have the power to do much
mischief.
With this ezception--the Importance Of which
in calculation Of this nature will at ouce be
perceived-our position bears striking re.
semblance to that of the United States il the 4
years 1886 and 1887. The advantage is in fact
on the side Of the latter in one respect. The
OF 1887 was in importing, pur-
chasing and manufacturing more goods than we
could sell or consume. That Of 1853 and the
year previous has been developed in the con-
struction Of more railroads than we can pay for
Four hundred millions Of money, it is calculated,
arc locked up in our railroads. The country
Is not rich enough to lose this amount OF CAPT.
tai and though ultimately, Of course, the de-
velopement of the land through which these
lines pass and the Improvement Of our internal
communications VIII produce benefit cheaply
purchased at this cost, yet for the present these
works have required an outlay greater than the
nation could afford. From the moment our
railway bonds ceased TO be negotiable in Eng
land, it was clear thai convnlson Of some sort
was inevtable; it argues an over sanguine spirit
to suppose that it has passed away so long rs
the leading railway companies are in the mar
ket seeking fresh loans.
HE evil effects OF oyer-inpogtation AMI ex- |
travagance in living viii correct themselves by |
degrees, at loss to individuals proportionate |
10 their former excess. 1t was clear wten rail. !
way securities began 10 decline tina, .onc Of |
The roads in-process Of construction would have |
10 be abandoned, and that the country demand |
for merchandise would consequently bc re-
luced. Ii was also plain to any shrewd OBJ |
server that this same decline would atraiten |
the means Of farmers and country mercheuts-
nn Of whom held stock or bonds in Railway
and that consequently their purchases at Inc
'eaboard would be restricted to the bare neees-
aries of life. Notwithstanding those clear
our merchants have imported
argely; and it now follows that the auction
torres are flled from garnet to basement, and
hat we record daily sales Of dry good Al . loss
y WA w thS4t, ia ih otbAt2WN W tLltS W
most every business man In this and tie other
reat cities Of the Union has spcculated In Stock
uring the past year, and paid the usual PEN
lily Of outsiders. TAe Losses in Erie s.nce 1t
old at so, would have ruined all Wall street
vice over, had they been confined to that class
Il the community. As it Is, there Is hardly
merchant or professional man in New York,
Boston, Philadelphia or Baltimore, who hos no:
Written of some hundreds or thousands Of dol
airs to loss on Erie or other stocks Finally,
line-tenths Of the mercantile community have
,een living above their means. Pains have been
aiken by mon who one year make, but the next
ose fortunes, TO rival the nobility Of foreign
ountries in the splendor of their residences,
he magniacence Of their cquipagc, and the
completeness of their domestic arrangements: |