New-York daily tribune. [volume] (New-York [N.Y.]) 1842-1866, 1857-11-27
TIE PRESENT CRISIS.

t1Vp1 ROT OILY or OWL v -Lie w. ~ "'-s va IN -
e1porta'ious. Naru'sc,uiirg establishments and rail
roads employed a ges; number Of persons The
merchants were conducting their business with rs
much prudence at any former period Houses were
being built the cities and villages and IN the farming
| ds,rcts, sno lsho; Was in coed demand.
Nor affars are in very different condition. The
merchants are broken up; manufacturers have Gus
pended their opeI aors; burdred. Of thousands OF IS
borers are thrown GU, of employment ard in danger
of Starvation farmers cannot get their abund ant crops
| 70 market ard il they could they would be obliged
to sell them at gresty reduced prices. Business stands
still. -.
Jbs great chsncs ia rightly said TO be owing to diff
6cutes in enance 10 the crisis in the money market
All the money of the raiion, bank notes incloted
amounts to shout FIVE hundred millions OF dollars.
Probably when tre icus'on OF The banks hss been
| the moot expanded the whole currency has never
reached ak bur millions. But tie productions Of
labor for the last year stmsted st three billions
five hundred millions Of dolsrs-shout seven times as
much ell the currency OF the ration, and these pro-
| ductions or a srge proportion o. them will chsrgo
hsnCs through the process Of Manufacture and other
wise from three TO eight ten times before thsy resch
the actual consumers. Now this comparatively small
sum Of money must pay for every one OF these ex-
charges fO- every debt contracted in making these
txchsfgss The same money must a'so psy for all
the sn6s that cold by the government and by iu-
divduss fer all the bords Issued by railroads cre,
States and bv the United States; all the debts coz
trscted by borrowing money from banks upon bond
| and mortgage otherwise. II must pay for ali the
stocks ard securities that sCd a. private sale, at
auction arc by the various boards Of brokers' aud for
all the bills Of exchange sold from part of the
,ry 10 another as well for all bills of exchange upon
foreign nations II is evident that this comparatively
| small sum of money must change hands great num-
Der of times effect the neeo exchanges OF this IN
| uerse amount Of property and thet any obstruction
10 its movement or withdrawal Of portion OF II from
| circulation must seriously emoaTass the business OF
the whole country. The imp"rauce OF this free crcn,
1 &c, he
when state that all the money we possess-gold,
| silver and paper-woud not suffice to pay the board
this nation for four months st 81 per week TOR each
| ndiviius.
The CITY Of New York is the financial center of the
| country IL the banks in this city keep up their lines
| OF discount to supply the business community
with money the banks IN all other parts OF the ooun'
try will also Discount and supply the people in taeir
neighborhoods. OF course there must be, a. IL mes,
Balances greater less against one part OF the coun
try in favor Of ARCHER but al these will be easily ad
| usted and bpsines. will go prosperousy.
In the latter par OF August last thu Ohio Lie ard
Trust Company with capifs Of two millions OF dol
lars suspended payment with debts against the Com
psny the amount Of six millions Of dollars
This failure the apparent occasion Of dstrust snd
of contraction IN bank issues 10 the amount OF some
eight millions of dollars in the course Of two weeks
end 10 the 2ith Of October Of shout twentys,1 millions
Tb. contraction Ct discounts for the first two weeks
only was doubtless much greater oss TO the business
men of this city than the entire capital and liabilities
| Of The Ohio Life and Trust Company. The news OF
| this ourtaiment rushed with lightning speed to all
parts Of the country aud carried condemnation INTO
| eyery city and town where bank existed and the
banks in this city and throughout the country called
upon each other 10 up their baisnces IN specie
MANY If the banks in this State Obliged not only
TO stop dscounng but had 10 send their State Stocks
10 this city and sell them at from 10 TO 80 per cent loss
to redeem their bark notes ano take them out OF ccu-
| lston in order to gave themselves tom suspension.
But this was not the worst Of the evil. Merchants
| unable 10 get their notes discounted at bduk
| were driven into Wall street ana compelled
to borrow at exorbitsnt rates of interest to meet their
pawn ents thus rapidly increasing their Indebtedness,
ard rendering il inevitable that in the end large pro-
portion Of them should be broken up. Many of them
paid 10 uurers for the OF money one, two three,
1 four FIVE and six per cent month, and FROM these
rates 10 quarter q half and sometimes one per cent
| or more day, and compelled 20 leave double
ire bic ard quadrupe securities 10 obtain the money al
sl The banks BY curtAilirg their discounts that
money is not to be had 70 meet the mercantle engage
merits the foundation upon which the contracts
were based and the merchants can no more stand up
under such an event than house stand supported
by the air If the foundation be removed from under It.
| Money is the only thing Recognized by our laws as
ttnaer ard all the property Of debtors becomes mere
collateral eeourty for the payment Of money Tor their
obligations Hence in a crisis Ike this the great
wealth of Me nation seems to be concentrated in the
| money.
The banks hold on deposit millions of dol srs be-
longing 70 the public on which they ere paying no ia.
terest II The tables TUNED and the public should
me Ike the banks pay five per cent month on these
deposits in advance until they could pay them all OF in
specie the banks would soon be az insolvent as the
| merchants yet il would be quite az just and
more go thar for the banks tO force this ecessty upon
the merchants ard others IThe banks are public To-
siituons. ard authorized by law 70 furnish the
currency. 1t pens otfense for individuals 70 clf-
culats their own notes money. Labor bills receiy.
| able goC de- wares and merchardise are not money:
all of these must be exchanged for money IN order TO
pay debts. The public is entirely dependent upon the
banks for this money and If they DO not furnish it,
the people mus borrow Of at rates OF interest
which are certain to eat ptber assets and 10 many
instances leave Them after long life Of toll, in abso-
| lutte poverty. m
Our INGREDIENTS have sold many millions Of dollars
worth Of their best paper at rom three to six per cent
an onth discount From a Elk mJfths note for OOo
take five per cent a month and the borrower will got
OILY 500 The discount on the same note AZ seven
action this usury the borrowers indebtedness
1855. II the merchants, manufacturers and mechaIlc.
OF the City Of New York would come out and frankly
state under their sign ures what rates per cent
interest they have paid for the of money during
the last three months giving the names OF the parties
from whom they have borrowed il and the securities
they pledged TO secure the payment OF the money oor
| roTec hundreds yes, Thousands, OF extornons woud
| be revealed which would greatly sstonish the public
Could these transactions be further traced, we think
| Il would be found that very large amount Oh Tue
| loans of tie banks are made TO brokers ana oslef
usulers ard 10 the officers and directors Oh osDKs
| themselves many Of whom would not borrow from
hank AZ ali when the street rates OF interest were NOT
above seven per cent per snnUrn LEI us LOOK q. mo
| gain usurer could make on out SiVoVy w. lui.o
mouths discount at bank would be s75O, leaving to
bis credit $9S 80. Ths sum will buy paper a. SIX pef
| cent month 10 tbs amount Of el2l 5G5 81, and the
osper would mature in tune to meet bis note at bank
| Should the Insurer renew hs note for smother three
months, he would have s2l 565 ~ more TO invest than
he bad before amounting with the s'S, 2oo 10 VIZ
us 81 This sum 81 six per cent month would buy
| sl45 993 50 worth Of notes THUS the usuIer would
gain si5 993 So Cd sI moptns Investment Of 500 OO0;
and this. too without Using dol ar OF hls own money
and without having performed sny productive labor.
The rren who eel TINS paper indebted si5,s93 %
| baVe bean had the hanks dis