The New York herald. [volume] (New York [N.Y.]) 1840-1920, 1858-02-08
FINANCIAL AND CONNER CtAl-
a o N Ely N a X X 10 T.

In the stock market there is o strong upward ten
d'nc, N prices. At the close Of the market yester
day great activity prevailed among spectators, and
operators for rise appeared to be full of confidence
The money market decidedly favors such anticipa-
tons, and will do much towards bringing about such
results. The complete stagnation of business, the
limited demand for money outside Of Wall street,
except for liquidation Of old debts the fact that
business engagements when trade again opens, will
be made upon credit all confirm the belief generally
entertained that money must be for many months
very abundant and very cheap. After period Of
contraction in business and general hqui-
datioh OF debts, an easy and cheap
money market is the natural result. The
accumulation of capital ut the great financial
centres is usual until revival of trade and gene
nj movement in all the machinery of traffic. We
have repeatedly realized this course Of things and
have invariably found an oversupply Of capital
seeking temporary investment. Parties in whose
hands this accumulation of money exists look about
for some place to employ it until the wants of their
regular business require its withdrawal. In the
mouth of July, 1864, Mr.. Schuyler made known his
defacations. The blow given TO the credit of rail-
road companies and the loss of confidence in railroad
stocks generally, caused tie withdrawal of vast
amounts of capital from such investments The panic
caused by Schuyler's operations acted a check
upon business affairs generally, and great contrac-
ton followed. Throughout that fall and the winter
of 1854 and 1855 no new contracts were made, and
credit became much restricted. This went on,
and during the following spring the pros
tration of trade was widely extended. The panic
hardly amounted to revulsion, and the recovery Of
confidence was therefore not so long delayed and
went on rapidly The summer of 1856 restored the
public mind to its usa! tone and steadness and the
wheels Of commerce were again put in motion. The
previous contraction and liquidation left the
tile classes with very little business, and less in
debtedness. This was followed by rapid accumu-
laton Of capital, and demand for money.
Throughout that summer there was a perfect
plethora in the money market, and the nearest
period Of activity that for the moving of the
crops during the months Of October and November.
Every one having mohey was looking about for some
temporary but available method of employing it
until demand sprung up for legitimate business
purposes. The only way that presented itself was
in the purchase Of the best stock securities the
market. The investments at that time generally
in the first class railroad stocks and such
the impetus given TO prices by this rapid
absorption Of securities that an important advance
realized. The result that by the time the
merchants and others engaged in trade wanted their
money to meet new engagements the stock market
ranged ten and fifteen per cent above points ruling
in the early part of the summer. Those who
obliged TO realize made great deal of money in the
shape of differences, and had their money in hand
just the moment required to engage in the move
ment of produce, any other line of mercantile
business. This was the exact course of things at
the time, and IL looks very much though similar
operations. with similar results, would be realized
between this and the Inauguration Of a new era in
commercial matters. The contraction Of credits
the prostitution in business, the liquidation of old
indebtedness, the absence of new obligations all
point 20 a vast accumulation Of money in this
city, and we cannot look for the restoration of
confidence to extent sufficient TO give activity to
any large portion of this capital in the channels
of commerce until after another summer. In
the fall OF the present year there will be without
doubt O moderate demand for money, and the
whole civilized world will probably actually realize,
for the first time since the discovery Of gold In Cafor
mia and Australia, the fact that more than
one thousand million Of dollars in gold have been |
added to the currency. For the past eight or ten
years credit has been so much expanded that the |
demand for money has, If anything, kept in adj |
vance Of the supply and the rates Of interest have
as a general thing. ruled high All sorts Of projects
have been originated and partially carried out Capt.
tai could easily be obtained for the most extending
enterprise; and throughout nearly the whole period
of production in those countries the world has found
active employment for the whole amount. Had il been
twice as large the probability is that the demand
would have been equally great. The revusion OF
1857 having scattered the fine visions Of spectators
and swept away the enormous and rotten system Of
credit we now find ourselves the other extreme,
with an immense supply Of money, without any de-
mand for regular business pursuits for speculation
II therefore strikes us that we are about entering
upon new era in financial Affairs and that we shall
soon realize the fact that the world Is full Of gold
and silver. The production is still going with in
creased results, and it must be years before We
get up another expansion in credits to an extent
that will absorb the present and the future supply Of
gold. We sec nothing in the financial horizon calcu.
lated to prevent an abundance and cheapness Of
money among all commercial nations, such has
never before been realized.
The steamship Arabia at this port from Liverpool,
brings us seven days later news from all parts Of
the Old World. Her dates from Liverpool are to Jan.
%, inclusive. The advces arc, both in financial
and commercial point of view, particularly favor
able. Quotations FOR conscs closed at e5 a e5l per
cent for money. The Bank Of England had made
no further change in the rate Of interest, but the
last returns show an increase in bullion Of more than
one million pounds sterling. American securities
were inactive and unchanged in prices. A very ac-
tive cotton market is reported with an advance Of
one quarter OF penny per pound for the higher
grades. Bresdstuffs were dull, at prices previously
quoted In the manufacturing districts there was
itv With IN In tr~,coa for yooda
generally. The news from India Ia unimportant.
The acute stage Of the financial revusion appears to
have about run out on the continent Some failures
are reported but they doubtless the remains Of
the old set Of insovents. We must look for occa-
sional faiies in all parts Of Europe but the worst
appears ODE over and the probability is that there