The New York herald. [volume] (New York [N.Y.]) 1840-1920, 1857-12-03
HIGHLY CURIOUS FMkICIAL VIEWS.
THE OPINIONS OF A RETIRED STATESMAN.
TIE sEyULssos In TIE UNITED STATES.
State Of Currency and Credit in
Europe.


>->o>~~~>~~~~~~->~>o-
Dangerous Condition Of the Great Bankers
In England, France, &c.
TO JAMES GORDON BENNETT, EDITOR OF THE HERALD.
WASHINGTON, November, 1857.
DEAR SR:-The commercial crisis in which this
country is now involved is not question of banks,
brokers and broken merchants. 1t has spread over
political events, entangling our foreign policy and
oblterating great domestic hopes and grievances.
While Sir Gore 0useey, who has just reached here,
will fancy, find little difficulty in carrying out his
mission to Lord Palmerston's satisfaction, Pacific
railroads below quotation and slavery is unspoken
of, even in our Eastern streets. 1t has shaken not
America alone-it will shake Europe. You will
therefore not have seen with surprise the hot and
hasty return Of Mr.. Auguste Belmont, our late
Charge dAfares to the Hague and principal agent
in this country of the Jewish kings of gold,
nor chronicled with especial wonder the many
closet conferences and communngs which
have taken place between the Rothschilds'
minister and the chief magistrate of this
country / do not doubt that prudent sagacity
which is Mr. Buchanans chief characteristic, ques
tion his power of penetrating how far that financial
have urged within the past few days with great zeal
and ability, derives its impulse and argument from
the peculiar interests of the European moneyed
powers he represents. But let it be remembered
that the whisper of the Rothschd in royal ears has
been remarkably disinterested nor docs their
agent, Mr.. Belmont, bring to the elaboration any
powers except those delegated to him by his
teachers in finance. His information on Ame-
rican matters is limited, and his judgment equal
ly circumscribed. As an instance / may cite
the fact that the first indications of disaster
an English official applied to the house of
Belmont for information and advice on this sub
iect, when he told with gay confidence that pos
sessing which ran through every artery of the
country and familiar with every minute fuctuation
in the beating of its monetary pulse, her condition
might be pronounced to be perfectly sound and
healthy and that all who gave warning to the con-
trary interested in the creation of temporary
panic.
Thus at no moment has our history been more big
with colossal events and the posture of the Union
for the next fifty years will inevitably be affected if
not determined, by the action of Congress and
the several State Legislatures within the next six
months, it may be wise and we'll for one who holds
the interests and prosperity of this country alone
at heart to present calm and clear review of the
causes of the present crisis and its probable conse
quences here and in Europe.
Railroad speculation and mismanagement may be
the present and active cause of this trouble to a
great extent; banking disaster hinges upon it;
but we must look elsewhere for the remote cause of
o disaster which has assumed the proportions of
a national catastrophe, the effects of which must
deeply affect, If they do not parayze, the constitu
ton OF to the uttermost parts of the world
Railroad speculation is but the branch of financial
disease existing for many years in system, and
10 which we trace the seat Of disorder. The rail-
ways themselves, with their iron arms may be said
10 point towards the cause of our disappointment
in their results. They lead Us to the West.
II is a sound practical maxim "Let Us begin at the
beginning" and in probing the crisis touch the
cause in that Western mania that has afflicted the
body Of the community during the last twenty years
IL may be aptly called the growing pain" of the
young country, and like many youths who outgrow
their strength we are laid up with IL. Let ex-
anime the picture afforded by the trans-Alleghany
States We see there a population not
engaged in the legitimate and usual chan.
nels Of commerce and agriculture, or IL
they were, such slow matters were regarded
only necessary means and secondary object to
one great absorbing idea: speculation in real estate.
Into this scheme the merchant flung his gains his
clerk threw his salary the farmer sowed his crop.
and his laborer counted over his savings, with the
one absorbing idea that all was TO be invested in
land For the last twenty years a belief wild faith
in the West has been growing spreading and alb
sorbing all classes in this wide expanse OF country.
IL was well founded in the first instances but when
capitalists Of the seaboard sweed the tide OF West
crn speculation, when subsequently the same feeling
indefinite a. such feelings always are-oi blind faith
in this agricultural Golconda reached Europe, when
Germany aud England crowded into the golden
field, II II natural that the Western people. who
never claimed either moderation or circumspection
az q Characteristic should rush into exaggera
tion. in which the whole commercial world now
finds itself more or less ensnared.
Let us not mistake the character Of this specula-
tion in Western lands II not lands to cultivate
lands 20 build on: IL was simply lands 10 sell and
lands 10 buy. Real estate was only iguratiye-the
real object Of purchase and sale was the progress of
the country. Tomorrow was worth 50 much more
than to-day and a. fortunes were made and carried
away from the West. speculation was maddened at
home and confidence increased abroad. The buyers
would not that the lands were not producing pro-
portionably 10 their increasing market value. They
refused 20 observe that most of them were not pro-
ducing at ALL the most intelligent hoped the fever
would last their time: the most foolish believed IL
would 60 on forever Thus the whole face Of the
try has been FOR the last ten years vast land ex
change" Half sections of wild lands and corner
lots Of houseless cities were used like stocks and
shares; real estate no longer regarded an i'm
movable, an investment whereOn credit could rest
with security basis Of an agricultural communi-
~ and a sound productive value. IL was made, by
convenient local laws, 10 represent as convertible
a thing as bonds bills or scrip, passing through a
dozen hands within sixty days with less productive
value than fancy stock and in most cases the buy.
erS knew less about IT, condition and prospects.
Millions az acres were bought and sold without either
buyer or seller knowing or caring in what county
the estate lay where II was or II it was anywhere.
so long each could get rid Of bis investment with
In q reasonable time
To encourage public improvements, canal and
railroad enterprises were endowed by Congress with
50 many millions Of acres and this land thrust
into the market TO pay the cost Of constructing the
improvements and interest to shareholders. All this
initiated the system Of selling hand on time, the in.
stalnents running three, five, seven, and FIRE.
quenty ten years bearing interest as low sometimes
a. two per cent per annum inducement 10 invest.
thus a sold 70 on three years credit Il sold 70
q on the same time but at an advance g IN like
manner TO ID and 80 on until in two years AS e.
tate had arrived at y, who paid through a long
chain Of intermediate holders resting on each other