The New York herald. [volume] (New York [N.Y.]) 1840-1920, 1857-09-22

Ba-k suc ns deoos -.re rsm.yed 10 90 IAN banking
Institutions regcaed b. Sate laws, ocs ed In the differ
ent s-t;s soeh NJ accession 10 tnc available near. Of
| thesa STATE bAIks ncsniiyo 20 psuaios snd
bey certsriy ate he most Of It To the sps-e Of 70
year he line q discounts ops the country essAd
ibsn tive buue red mionr Ct lars an the credit
stem hecsro enormously expanded The surplus
rre at that time In paper, bank bills snd su-h s.rH
Il wHs nothing bot . rep essuattss Of property ~hion
wss tur:c-td 10 exist somewhere In the vsuss u
banks Tbs paper eA transferred from the Uci'.d stses
lsak 10 The Stale banks ard from tse ks tina
me- O. mile classes In IN. share o. drc,an. TIE ircen
live ihus gv.n 10 Business rsi ed rood
deal Of o'eitadrg. to vas; deal OF speca aoo. 10
tIrrl ora INF ton In pricss FOR cry syeses property
and to IN eaprIrOn Of credits which Involved the nru
nifty generally IN one universal whirlpool OF
In the idsl Q. hs excitement every enc MOVED see sa
10 Ioae rgDt Of the probshe result tn probability tha,
nc che ihcngh OF It, but moved along with the OF
t,dpg and '-.cuson. utterly regard ess OF the CO. Sc
qrehces During tho sress Of hjs expansion In mivae
oSeds the Political "a lies OF be day were epgpgsd In al
OF mens connected With the cure w sad ,he
different conn ercai systems Toe surplus evouro
'he csuse q great deal 81 difficulty Tns genera g..
verI neni ssreed TO dirlce amcrS tbs dGegos. Vt t
srd tie dir re States dlfAgre,d about receiving IT,
The dnerspt Lesifsiu,ts throughout the winter 81
1850 Sr' cnrek~crcG 70 tre rcreJGaFY acts
It's acceptance and disposal and OF than settled
points 81 their satisfaction Toe tariff OF
called and ia known a. the Compromise sot-enforced .
high Of duty, which with the Incentive given 10 N
ROTATIONS the expansion and extent or the credit
ten led n en- immense ncere In foreign us,e AM
Involved % deeply with foreign manufacturers fne GA
spce u trade ul ussly became largely sKsass and
demand for our specie for export hagnsi The approach
ing collapse Tho I4nd specuaons o. toe day, tue rspd
increase In stock ccmpanes the high prices ruus for sn
the nscessse' as well ~ the uxu,es OF ie tho extent u
trading upon borrowed capital Inc a OF real ST.
for the huge srucsore Of ssd exavsg ,uos the i'm
peritc rain ccndI,isn OF polto,' financial
and ocmmercsl E! stems led TO and Fesaed In revl
sion - had been by the oldest inhso
iaut 70 thst two ncommepced In the e.! OF 1874 h.,
Idlied during pe WINTER proxe gu. via creased
force Ia the spring OF 1897. The largest failures com
mes eed In tho month OF March, 1887, and fr m
thai time out bankers and brokers, merchants,
manufacturers and mechanics went down Ike
pile Of brcks, one aner the osh.-, until
all Who bad traded upon borrowed cspAal, or who neo
become involved In any Of the laad and stock spe'Ua
tons Of the day, became bankrupt and inv ,lved in
common ruin In this way The and sJocSlan rs OF 1884
1895, and 1885 cul ninsted twas years beors the
rous important interests OF the country from
that p,oetrstion For years trade was de nessed. New
banking systems adopted and commercial systems
exporimented upon. In lS7 the discovery of California
gold gave now impetus to speculation. The accession Of
gold formed strong and substantial balis for all
cial operasons, and Efforts made to build up a
credit y item OF superior character The arrival gold
every steamer BY millions, wore events that took the
entire community by surprise. The most exrsordinsvy
and eItravassn ideas prevailed regarding the probable
effect on property and prices, and some very curious
theories found converts. II was the general In press,n
that the value OF money would be reduced, and with It
the value Of property. Is dil not 70 TO tue
public 81 TIE une tina. had vast country 70 Inn prove;
that had thousands upon thousands OF miles Of rail
read 70 construct and millions upon millions Of Of
land 70 cultivate and improve; that had ci.ies
to build up and fleets OF steamsh!ps 10 consrua
II WAS not supposed for . momen. that the incel
Two that this gold would give to industry wpuli give
greater ncrcsse In property than In s representative
10 other words that the substance would as,e
than the shadow. Those who supposed that THE great In
crease In gold would do away grea deal win credit,
reckoned upon fake pre- misses, and hsvo this carly day
their the ave hundred mions OF gold drg
from the nres OF California and scattered the vhcls
world, have become the basis OF credit system sny
times the aggregate. In the period required 70 produce
that smcurt OF gold there hiss been produced hundred
mos IRE amount OF rropry In his country NloDs, ha
The actual representative OF property 10 prop
grcs'cr ,h.n IN 1888 and 1890 Then had
-rodrenshle paper ourrsncy ard vast paper clrcuaon
have . limited paper currency upon so,d basis
faen ,bc geld ard silver OF The country locked up In
INC bALks Il Ia general circuls Theu IN pager
tyslem ,Le uaedum fer sl he 1rsrcis operations
tcs sovtrDucp, row ia gold and slvcr Then the rur
Plus revenue, in tho hands or hs banks, used for
specl alive purpo1es; in the direc. posses.ios =.
.over az ut AID serves check upon over trading
Now be cEtascn " gold ro tbs banks By tie govern
oorres hose ib,utpuens . coutac' then any To-
c,e~c n ~ -rbro revepne ,erved basis fer further
eIp'rsion. Nov we have an expansion In public
oreiu which has involved much capital
rat private operations lof without support upcn tao
bst Withdrawal OF condacnoo rhon 20 had expansion
In bank credits, ~hion Withdrawn upcn the or
OF alarm and tho support OF tho mercantile proved
TO DO jur. much rredesmsble paper, and tao whole
oro.d vent down together. The revulIons WHOA we
have ju,. entered upon d. without dorb; be confined 70
iha. eA Of merchants and nnanoers who hsvO become
involved In he railroad operations Of tho day me
-u-on n 1897 carried down those who depended entirely
upon bank fsvOu and bank support The prevent Tevul
not much connected with banning To isu
tons, and they vil, without doubt DO able (, suisn
themselves. Thse who havo cournsi Themselves u q
legitimate Line CT business and have aos vortared r their
operations Voc far beyond the limit Of their capital, may
weather Tie Storm, b.. hardly cxpcoi 70 pass through
unscashCd CDfor.unsey, our railroad interest has be-
zone 20 muoh extended and absorbed Fucn inmsnse
tmorn, Or csp, TIA, nearly every eu1ncrs mar 10 r1rs
or less involved AMI nrGs POI ION 81 BIS capital looked
mp these unavailable securities. he large failures
which daily reported show That be Revision win be
vely ended In liz operation, and Of older
bousss have already saspendei the publ, lod has be-
come alarmed degree Ma, win OF Itself lead 10 noss
DISASTROUS consequences.
The anne, ed statement exhibits The condition OF the
leading der arlEncns Ia each bank IL las cv the
morning Of saturday, SGT 10, ls5s:-
Yong CRY H4ywu