The Nevada Democrat., 1857-11-11
rho Financiai Crisis In tho East.


speculations In unproductive western lauds and
fancy railroad stocks, and to the reckless extrav-
Egance and inordinate desire to become sud-
denly rich, which had seized upon all classes of
the community. These speculations have been
going on for five or six years, and their inevita-
BILE tendency was pointed out and commented
on months ago, by the leading Atlantic journals
Few business men heeded the warnings of the
past, nor could they discover any similarity
between the speculative mania which has been
gradually increasing for the past few years and
those which preceded the financial and CONNER
cial revulsions of 1925 and 1887. The influx of
California gold, amounting to about four mil
lions month, was doubtless the primary cause
Of the rapid rise in the price of all descriptions
Of property and when this steady stream of
gold became insufficient to keep up the fictitious
values, the banking institutions were resorted
to for the purpose of supplying the deficiency.
Had it not been for the fictitious currency put
afoat by the banks the revulsion would have
come some years ago. but in that case it would
have been slight to that which must now be
endured. A reaction must follow speculations,
and the longer the imitation is kept up by icti.
tleus means, the more severe and general must
be the revulsion.
The New York papers of the latest dates re-
ceived were holding out the delusive hope that
the crisis was nearly over, and that in few
days business would settle down in its usual
quiet channels. The wish in this case is no
AAuhk fat thar IN tbnu nrLf tb;n Hat. ~
We can read the signs Of the times Alright, the
crisis, 30 far from being nearly over, had scarce
ly begun. We shall not be at all surprised IL
the next steamer brings the intelligence that the
banks of New York and Boston have followed
those of Philadelphia, Baltimore, Washington
andProydence, and suspended specie payments.
For the week proceeding Monday Oct. 9th, over
four millions of deposits had been Withdrawn
from the New York city banks, the loans had
been contracted to the extent OF two millions
aud the specie reserve had decreased near two
millions. This unfavorable exhibit created
astonishment among financial circles, and must
have alarmed other depositors. The deposits
and circulation at the above date amounted to
over sixty millions of dollars. all of which was
liable to be called for at any moment, to meet
which there was less than eleven and half
millions of specie in the vaults of the banks
At q meeting Of the Boston merchants and bus
iness men, held on the evening of Oct. 4th, for
the purpose Of inducing the banks to extend
their loans, Mr.. Eben Wheelwright, an old mer-
chant Of that city stated that the Irish popula-
tloa had the power by Withdrawing their de-
posts, to break every bank in Boston. Under
ordinary circumstances, the New York and
Boston banks are doubtless safe; but slight
panic among depositors would compel nearly
all of them to suspend which would be followed
BY the suspension of nearly all similar moneyed
institutions In the country. A general suspen-
sion of the banks although it might increase
the present evils, would in the end be an ines
Unable blessing to the country, for they would
never again enjoy the same confidence among
the masses of the people.
The Philadelphia banks by suspending specie
payments have forfeited their charters. An
extra session of the Legislature had been called
which met on the 9th Of October. for the pur-
pose of having an act passed remitting the pen
atty. II is a matter of considerable doubt
whether the banks have sufficient influence to
procure the passage of such an act; the Demo
cratic party of the State had set itself resolutey
against it, and should all the Democratic mem
bers of the Legislature vote in accordance with
the wishes of the mass of the party, the measure
will be defeated, and the banks will be compell-
ed to wind up their business. AS the severity
Of the present commercial disasters is greatly
forded spectators for carrying on their wild
adventures, it Is not to be wondered that u pre-
judicc should exist against those institutions.
There is gold and silver enough in the country
for all purposes of currency, and as soon as
paper money ceases to circulate its place will
cannot seriously depreciate in value.
There is reason to believe that the present
financial and commercial revulsion will not be
so severe nor Of so long duration as the similar
revulsion of 1887. The solid wealth of the
country is now much greater in proportion to
the population than it was twenty years ago.
Then the geld and silver in the country amoun-
ted to only about sixty millions of dollars the
bulk of which was in the vaults of the banks
and made the basis of paper currency, Now
the gold and silver is estimated at two hundred
and dfty millions; one half of this amount is
said to be boarded by the people. and will
come into active circulation as soon as paper
money ceases to be used, for all experience
shows that where the currency of a country is
mixed, that portion which has an intrinsic value
will be boarded only SO long as the fictitious
can be made available. In 1887 the financial
affairs of the government were SO deranged that
she was compelled to enter the market aud bor-
rev money at ruinous rates Now, thanks to
the establishment of the sub-treasury, that Dem
ocratc measure 80 long and SO violently oppos-
ed hY the Mhira the nlethnric condiLion of the