The New York herald. [volume] (New York [N.Y.]) 1840-1920, 1859-05-23


me discount houses The eject Of this regulation opoo
tpe Dosey market has yet been practically tested
the course Of affairs during the interval having seen
susdrny arisen the money dealers have acted entirely
upon the princple Of selfdeence They know that
they hold in their portfolio paper endorsed BY ncssrs
bafpepny they raise upon at the Bank Of Eng
lard no matter how severely they may be pressed Bills
which the bank would DO perfectly willing 70 cash pre-
scented by other parties, totally nadmslQe from the
dsoup. houses Thrown thus upon their own resources
some Of the latter almost TO grant
whilst others possessing relatively the largest amount Of
wants Of their regular customers. charging however
the great majority Of cases, terms considerably above
those OF the bank.
The rpu seen in the rush to the discount ONCE 81 The
bank would appear that many Of the applicants have
regulated the amount Of their provision rather by their
that whilst the "oher" securities in the hank last week
experienced the increase Of 81 49, no less
than 1923 $40 Was lodged as ''other" deposits The
Of the market. Viewing the position Of affairs
as money dealers, the directors have merely 70
for her nu nn they may think
srge number Of borrowers repeled from sheer midy,
by other moneyed Establishments has obviously good
deal to DO with the rapid advance 10 the bank of dig
count from ~ TO per cent. Tho rise in the value
Of money abroad, and the necessity of protecting their
bullion reserve, have doubtless also had considerable
weight with the directors; but justified by
parson Of the bank figures with those for aatecedent
periods in assuming that their sudden and decided action
nhb petu principally ulCtAteu by tue pressure ~ the
discount Office The last return states the and bullion
at eli 200 ESQ, the minimum rate Of discount being Az
per cent In June, 1855, the amount only fl3,-
073otS yet the directors then lowered the charge from
AZ per cent In September, 1856, when the rate
was rased from TO ~, the metallic stock was only
fl3,6qs, ASS
Suspension Of cash payments by the national banks Of
Austria and SaTdn may be said 10 have accompanied
declaration Of war disturbance Of the money market
throughout Europe was inevitable and has indeed already
taken place. In nearly all quarters the interest
bave rsep The financial position Of France is decidedly
gloomy In raising their rate Of discount TO four per cent
per cent the Council Of the Bank Of France are merely
setting their houee order against drain of specie CLEARLY
foeseen The crisis ENDS the French naton in financial
sense upprpaIed at many points Throughout country
vast number Of pubic works in progress under the
most unlimited Powers OF borrowing accorded every
town and District The enormous sums required by the rail-
companies for their branches and extensions have
for sene time past been provided through powerful as
sis'ance Of the Bank of France. At he end of next
month, however, the companies must look TO their own
retources, the agreement with the bank expiring The
magnitude Of the sums required may be estimated from
the fact that the annual meeting just held of the share
holders IN one Of the principal companes-the Paris
Lyons, Nedterranean-the directors were formally EN-
powered to raise loan Of Ct Goo The na.ioea debt
resto alton Of the empire. At this moment the subscrlp
ton lists are opened for another loan OF EGO 600
should the war be prolonged, further heavy de-
naDds OF the came kind certain. The distribution
OF the payments on the present loan Of f20 900
over period OF eighteen months, furnishes not
other loan in the interval Duri7g the Russian
war q loan Of 10000 GOO was ANNOUNCED in France
many months before the completion OF the payments
on the previous Of eco 600 GOO. That the financial
strain upon that country will be ia certain and we
cannot hope to rempin unaffected by the straits Of the
coptin nsl markets. 1t cannot be too pointed out
however that as long do not actually part in
the war; the effect In financial circles here be only of
an indirect and secondary character. Even the money
required for increased armameHts will be spent at
home France and Austria have gone to war but that
fact does put England in debt with either Of them
Their new loans we decline to touch and he must be
bold nah who invests in their existing securities how
ever Depressed hese may be- until the scope the war
shall have been more clearly defined Foreigners have
doubtless drawn their floating balances from this coun
try, and have taken discount every claim
they have upon us; but these expedients are of
an abpo maj character and their operation cannot be per-
mopett We therefore warranted in concluding that
although the Dghness OF the continental money markets
must react here there is no occasion whatever
one OF The principal contingencies to be guarded against
is the propagation Of that vogue feeling Of dsust which
has already cone 20 much TO paray financial transsc
tons Establishments overloaded with morey have of
late shown an almost unparalleled unwiDgness 10 lend
This disposition to hoard scarcely last long The un
settled fee ing which has prevailed during two or
three weeks will probably subsde whether the
bank rate or discount be per cent, money will
doubtless be freely supplied ut the price fixed It Is not
so much an advance 10 the value Of money as uncertain
", which prejudices legitimate trade.