The New York herald. [volume] (New York [N.Y.]) 1840-1920, 1857-08-27

Cause and Probabis Erect.
We have been over and over again denounced
by or coemporRies because we had the clear
mes OF mind to foresee, and the honesty and de-
voSon to the public good to foretel, the crash in
monetary affairs which has been for some time
back impending, and which has at Last come
upon us with disastrous effect. With us the will
was not father to the deed We would have
warded off if we could the evil, and we now de-
plore its presence more deeply, perhaps, than
thoee who scoffed at our warnings, and who
tried 10 delude the public mind into state of
fancied security.
The downward movement in financial affairs
that was initiated on Monday last by the failure
of the Ohio Life Insurance and Trust Company,
is still ter ding in the same direction Yesterday
we were called on to record several failures in
large operators and brokering concerns in Wall
street following close upon if not resulting from,
the suspension of the Ohio Company. To-day
the list Of suspended firms is enlarged. Rail
road bonds and stocks, and all other classes of
securities, have sustained terrible depreciation,
and there is no use in attempting to disguise the
fact that there is lower depth yet reserved for
them. We publish to-day articles from the news
papers Of other cities, to chow what is thought of
the matter elsewhere.
This financial revulsion has very naturally
created much alarm in the minds not only of
those who are unfortunate enough to be holders
of the railroad and other fancy stocks that have
precipiiated the event. but Of those also who
have deposits in the hands Of those largely en-
gagged in stock operations. The one class, con-
WINGED at length that the HERALD was just in its
war against such worthless paper, will be careful
in future how they deal and invest in such stuff
In this they will be wise. The DAY for confidence
in railroad stocks is passed. and is not likely to
return soon again. The other class Of which we
depositors-have equally caught alarm
and many Of them have been for the last two
days insisting upon payment in gold
of their respective deposits This poll
cy, although we cannot in the present
condition of affairs find fault with IL as unrea-
sonabe, is calculated to cause the very evil that
it is designed to remedy. The last weekly bank
statement showed that the aggregate deposits in
the city banks amounted to S64 900 ,000 while
the aggregate amount of specie was molly one
sixth Of that sum 1t was but S10,000,000. 1t
follows, therefore, that if the run on the city
banks were to represent the onesixth of the
whole deposits, the banks could not meet their
liabilities, and would have to stop payment. Nor
is it at all likely that they would wait for the last
dollar to be drawn out of their vaults to meet the
demands of the depositors If the aggregate
draft reaches five millions of dollars it is not at
all improbable that most of our banks would have
to succumb.
We trust that we are not to have that bitter
experience. If not, the present financial crisis
will be productive Of as much good, probably, as
after all, any of the great interests of the ceun.
try. 1t may embarrass, to some extent, our CON-
mercial affairs; but thoee will soon recover from
the shock, and the great productive interests of
the country will remain uninjured by it, The
insolvency of all the bulls and bears of Wall street.
their amalgamation In one common undistin.
guishable ruin, would be, we verify believe, a ma
tional benefit Certainly, the people at large
would have no cause to regret it. Many will, of
course, be sufferers from the depreciation Of rail-
road stock. But they must recollect that they
have themselves to blame for investing in secu-
rites which are comparatively valueles. The
present monetary crisis has not caused the worth
lessness of these stocks 1t has only removed the
fog from peoples eyes, and revealed the true
condition of things
The lesson, though bitter, will be, we hope,
salutary one. Fascy securities, and all that pre-
carious class Of business which promises large
profits at immense risks, will be abandoned. FL.
nancial and commercial firms will henceforth,
like individuals, oonhne themselves TO their lie.
climate business, and affairs will go on steadily,
safely and prosperously. If that be the result,
then the present financial crisis viii prove to be
a general blessing.