The New York herald. [volume] (New York [N.Y.]) 1840-1920, 1858-01-20
The Commercial md Finamcial Prospect.

The city banks report an average of over
thirty millions Of specie for the past week
rather more than double their usual average at
a time when their loans were twenty millions
larger. We note a corresponding increase at
the other financial centres of the country, Bos-
ton, Philadelphia {where banks are about to re-
sume) and New Orleans; whence it is made ap-
parent that our plethora Of specie is not the
fruit of their impoverishment. The gold has
come, first, out of the sub-treasury, which has
lost over ten millions in New York alone; next,
out of the pockets of the people, with whom
gold is not as plentiful as it was, and VINO had
in private circulation far more specie than was
popularity supposed finally, from abroad, and
from California, whose yield has rather ill.,
creased than diminished. There is no imme-
date prospect of this immense accumulation of
bullion at the commercial centres becoming
speedily dispersed. The shipments to England
are already falling of. and, with the cotton
bills to compete with, the specie shipments will
naturally decline for the next few weeks. Too
little is doing in the way of internal commerc
to turn the tide of exchange very strongly in
faver of the rural districts.
The prospect is that the country merchants
will do a moderate but safe business this
spring. Many of them are already in de-
fault, and can have but little hope of
avoiding a forced liquidation; but others are
ready to take their place, and the trade Of the
country will not suffer by the change. Still,
with wheat at So cents in Chicago, and cotton
on Tho etaaIy Ian1ipa uifh norman Lotto upcalaa-
BILE at any price, and good land seeking private
purchasers at one.third the price per acre which
it commanded twelve months ago, it cannot be
expected that the country merchants will have
the courage to buy freely this spring. Their
orders will undoubtedly be as light in prspor-
ton to those of-last year as the returns from
the crop of breadstufls will seem when compared
with those of late years. But what they buy
this spring will in all probability be paid for.
The further we get from this revulsion, the
clearer we see its character. Messrs. Douglass
& Company. whose review of the crisis we pub
lished some days since, state that there are in
this country 2O4,06l commercial firms, exclusive
of banks, railroads, and very small retailers;
and that S, l23 of these failed during the crisis,
with an aggregate liability of some three hun
dred m1ions of dollars. 1t is likely that there
are many firms in the country which are not in
connection with the Messrs. Douglass, and that
their list II quite likely to be incomplete; we
may therefore assume that the proportion of the
failures, instead OF being IL per cent (as the es-
innate of Douglass would make iQ of the total
trading community, may rise as high as 2
or p per ceat of the whole. How small
a proportion this is to have created such a
ffacas. Every prudent merchant counts upon
losing over two per cent by bad debts; yet it
seems that the creditors of our merchants will
lose no more, OF even less, for many Of the failed
merchants are paying up, Notwithstanding all
the cutlery and clamor that has been made.
The people Of Europe who are bowling so ter
ribly about "the American crisis''-and espe-
cially those thick-headed newspapers in London
and elsewhere which represent the HERALD as
the a~pologist Of dishonesty because we stated
and deplored that this was a debtor, England q
creditor country-will do well to remember and
reflect on the fact.
We can arrive, with the help of it, at some
curious congratulations as TO the trade of this
country. If the failed merchants, representing
two per cent Of the whole, owed three hundred
millions, half of which their estates will pay,
what is the amount of their liabilities-in other
words, the business of the country? Seemingly
SIS, 900, OO0, 900; which would represent the ac-
tual amount owed by the entire business COM
munity to the foreign world and to each other:
in other words, the actual aggregate of the COM
mercial movement of the country at any one
time. To proceed by another road to the same
point: the aggregate exchanges at the New
York Clearing House in the year end
ing October l., 1857, the last year
reckoned up, were in round figures
$500, OOO, 900, having doubled in four years
Now if we presume that half the business
of exchange and payment is done at New York.
as it probably is, the actual exchanges of the
country would foot up like the amount of ag-
gregate liability in the neighborhood of fifteen
or sixteen thousand millions. This again would
represent the amount which is turned over at
least twice in the course of a year, and hence,
the aggregate business of the United States,
foreign and domestic, would appear to foot up
lOi Wv i"S' yChi VI PioSptii'y, I" tht chOrnlOus
aggregate of thirty thousand millions of dol
lars.
1t is doubtful whether any of the foreign ma
tions do such a business as this. Especially
when it is remembered that a great portion of
this business is done in poor, new countries,
payment is actually wrenched from the
hand of nature, will the aggregate seem enor-
But it is also very gratifying to New
York. When VIC think that out of u business of
fifteen thousand millions a year, the only loss
is less than s75, 900, OOO-for this Is the esti-
loss in this city-one may well call upon
foreigners TO forbear from remarks about Anne
rican insolvency and American dishonesty. II
will I've very well for Europe If the countries