The New York herald. [volume] (New York [N.Y.]) 1840-1920, 1856-08-18
FINANCIAL AND COMMERCIAL.

SUNDAY, Aug. IL

SUNDAY, Aug. l7-6 y. III.
The past week has been very active one in the
stock market. The transactions in all the leading
railroad securities have been unusually large, but
prices current at the close yesterday do not show
any improvement on those ruling at the close OF the
week previous The money market has not been at
all favorable for speculation ia stocks for rise.
The demand for money has been active, and the
supply liberal bat the indications Of severe strin-
rency are daily becoming stronger, and we have no
doubt at no distant day all the horrors Of a tight
money market will be upon US. The month of An.
gust is usually an easy time in financial matters
The Dank expansion generally reaches its maximum
about the second or thrc week in the month, and
the demand for the fall business hardly commences
until we'll into September. We may therefore, look
tor msre active demand, with comparatively
more limited supply about the first week in the next
month. At that time the bank contraction VIII,
without doubt, commence, aud the specie reserve
show smaller aggregate than we have yet seen re-
ported TITS year. The steady expansion IN bank
discounts during the past three months has ere.
ated an impression in the public mind, or rather
in portion OF II, that il is likely to continue, that
il has become permanent, that there can be no re-
trograde step, that the present movement can easily
be sustained, ami that the most that can be ap-
pretended is . pause in the imitation. AL
those who entertain such antcipations are
doomtd to serious disappointment The banks
cannot, by any possibility, avoid or prevent con-
traction in discounts. decrease in deposits and in
specie is inevitable, and with reduction in these
departments contraction of loans must follow. The
banks have no control over these movements. 1t is
not optional with them to expand contract. They
are governed by movements in the financial world,
like every body else, and are merely machines gov
erned by certain principles As the deposits increase
the loans expand, aud AS they decrease the loans
contract The annexed table, showing the banking
moveme MT in this city August and October in ca n
our views. II will be seen that in each year there
has been, from august to October important con-
traction in discounts and deposits. Daring the
mer mouths the deposits III our banks increase, and
during the fall months they decrease. The Of
this is clear enough TO any OF ordinary eompre-
hension. About the month Of June the business for
the year is about over. Nearly all the crops have
been marketed, and the money which was required
even after harvest to purchase produce has per
formed iis mission, and ia the regular course OF
trade has found its way back into the banks from
which il was drawn, ready for another operation OF
the same kind at the proper time. Money concen-
trates in this market being the great financial centre
of the country, during the dull season. and from this
point spreads all the country during the active
season. The banking movement OF this city, during
each period, is exhibited IN the following table