Daily Iowa State Democrat. [volume] (Davenport, Iowa) 1856-1859, 1857-12-03
Money Market

van street uEl the GAciHn9e were
nearly deserted to day. Occasionally bull
or bear would make his appearance. emer-
ging from some cellar or dark, dismal look
ing office, look about for moment TO see if
there was any one disposed to make an ope-
ration, long or short, and then disappear
No transactions Were made establishing new
prices or confirming the old The news is
far from being good for any commercial IN
terest in any part Of the world. The iinan-
ces of the two great leading nations of the
earth are totally deranged, and it is utterly
impossible that anything but disaster and
distress can come out OF 1T. The suspension
of specie payment by great banking insti-
tuition is an event fraught with consequent
ces of the most alarming character. A sus-
pension is always the result of a long and
severe financial pressure, and the change is
calculated for the moment to produce relief,
but it is only imaginary. 1t is more in the
mind than in fact, and the relief only lasts
until people begin to alizethat, if an, thing,
really worse condition of affairs exists
short time generally sutices to open their
eyes to the fact. and then they see in the iu-
ture a long period of prostration. depression,
stagnation and general depletion. There
must be q bona f,ie basis for representative
currencies. Either gold or silver must be
the standard !; and the establishment of my
artificial system doing away for the moment
with the proper standard of value, cannot
hut bring about all sorts of difficulties. In
the United States and IN Great Brit in we
have at tins moment paper standard OF
value. We have II currency that can he ex
panied at pleasure to an unlimited extent.
There Is now no regulator but the discretion
Ill,
therefore, just as likely to move enc way as
the other. The most desperate class of spec
ulaiors will undoubtedly make every effort
to eatend their operations, regardless of the
effect upon the rest ofthc community, while
the more cautious and conservative portion
OF the public will contract their operations,
econotiize in their expenditures, liquidate
their Indebtedness, and place themselves in
Il position to stand the shock that must come
when there great banking institutions If the
world resume specie payments We must
not for moment lose sight of the fact that
another and more terrible revulsion will
pass over the financial and commercial class
IS when resumption takes place, no matter
how distant the day may be. An expansion
IN credits, In business, or in prices, during
the suspension, will only make matters
worse upon the resumption, and this imp T.
ant fact should be constantly borne in mind.
The Bank of England and the banks of this
city must act In unison, and sustain each
other III any new movement made. Our
position is decidedly the strongest, and is
likely to increase III strength. The opera
tlons OF trade, both il this country and
throughout Europe, must be much restrict
ed, and long period of stagnation and in
activity follow. Through such process
only can we reach again a healthy position
The oder In Council suspending the Bank
act stlpulates that the rate Of interest shall
not be reduced below ten per cent. This
shows that the government does not intend
that the bank shall expand in the least; and
there Is much wisdom in the measure It's
the only way to avoid evils Of this great
magnitude, and to prevent the establish
ment OF an order of things that would put
OFT to an Indefinite period general resump |
ton ofspecie payments. The banks of this |
city have not expanded since their suspen-
sion, but on the contrary have steadily con-
tiacted, and will no doubt keep on in that
course. They cannot do otherwise. Their
own safety IS in SO doing, and self.preserva.
ton Is pretty good regulator The result
OF this policy on the part of our banks and
the Bank of England cannot easily be mis-
taken. Before the close of the winter wo
shall see dulness and depression in bust
ness affairs generally such as has not been
known since 1911 and 1872 We cannot
move our crops through the old channels.
ana II takes time to form new ones. Our
crops OF wheat and corn have been shut nm
in the granares of the West, in consequence
OF the difficulty of finding safe channels
through which to move them The cotton
crop OF the South is kept back from the shin
ping ports by the disirust of planters and
the loss of confidence in factors. The SIN.
pines OF our staple exports which have al
ready reached ports for shipment are ar
rested at these ports by the difficulty of find
ing responsible parties as consignees ON the
other side This. is the trouble. and it will
be long time before new parties will be
able to take position to command public
confidence and credit, and restore the one
ratlons OF commerce to the usual channels.
10 ex pect that We can arise at once from
the present arrangement and depression and
put forth new and better credit system
than before existed, with the banks under
suspension and the community generally
either publicly or privately bankrupt is to
expect impossibiitles and look for that
which cannot be realized The process, of
recovery to be healthy must be gradual. and
above all things to be free from n re,anse
~ y Herald o6fh