Western Reserve chronicle. [volume] (Warren, Ohio) 1855-1921, 1866-06-20
Genius in the Gold Market.
Finaneiering Extraordinary.
From Harner's WeekIv

lICd5uII AC1O dI lnC LALlC ONcI
600 of gold-much more than he needed
for the payment of interest of the pub
lie debt. He determined to sell portion
Of this surplus and accordingly, for
some days, fed the market with two or
three millions daily, at the rate OF 1907
per cent. Spectators and foreign bank
ers, studying the state of affairs in Europe,
were confident that gold woEld rise, and
bought all the Secretary was willing to
sell. ...-.. +. ..-s- u
A sharply defined contest thus arose.
On the one hand, the Secretary, with
$50, ,000, 600 of gold on hand (allowing for
$I5, 200, 900 sold), was determined that
gold should not rise above 130. On the
other hand, the public, persuaded that
gold could not be kept down by any
Secretary in the world, in the face of the
war prospect in Europe and the high pri-
ces of all commodities here, were as reso-
lutte buyers as he was resolute seller
Newspaper organs of the Secretary de-
nounced the 'sGoold-room speculators,
and declared that the Government would
sell every dollar it held rather than let
gold go up. Other organs Of public opin-
ion were less clear as to the result, and
trusted that Mr.. McCulloch would have
better luck than befelI his predecessor,
Mr.. Chase, in his contest with the Gold
room.
Matters were in this position, when, on
Monday, May 81, at 4:l5 P. NJ, the news
of the panic in London was flashed over
the wires from Halifax. Amy child could
tell what such news Portended. Every
broker, and every speculator, and almost
every merchant in the city rushed to the
Gold-room. The Government, broker
| Mr.. Peter M. Myers-Was there, peddlng
out the Government gold at 1903. Nei-
ther the unusual throng nor the astoun-
ding character of the news disturbed his
calm complacency. He had his orders,
and he would obey them. 1t had been
pretty generally expected that on the
receipt ofthe news the Government would
either Withdraw from the market for a
time, or at least advance its rate. Moth
ing of the kind was done. In reply to
the inquiries, Mr.. Myers said he would
sell at the old price, and to any amount
desired. A tumult broke out even more
tempestuous than the wild scenes which
were so often witnessed in the Gold-room
during the war. Mr.. Myers was besieged,
hustled, crushed, almost throttled by
eager buyers of gold. So fierce and fu-
rious was the demand that in twenty
minutes he sold, at 1904 and4 some ff-
teen millions of representing sum
of nearly $4,000, 900 of currency. As he
left the room few minutes after FIVE the
excited buyers bid up the price to 1921.
But there seems to be fatality in the
operations of our Treasury Department.
On Tuesday morning, before the appear
ance of the Government broker, gold sold
at 1924. When he showed himself the
premium fell to 1911. At that price he
offered fifty thousand. 1t was taken, and
in few minutes he had sold million.
Then his courage or the courage of his
principals failed, and he fled discom6ted
from the room. The premium. instantly
leaped to l344 and the parties who had
to pay for gold, reassured by this lndlca-
ton of infrmity of purpose on the part
of the Government, began to hope that
the Treasury would not exert its right OF
| insisting on payment that day.
The event justified their hopes. Not
much over one-third of the gold sold on
Monday was delivered on Tuesday; an
other portion of the amount was deliver
ed on Wednesday, and the balance not
till Thursday. The reason generally as
signed was that the sub-Treasury had
not certificates enough to deliver all at
once.
For the sake of out-of-toWn readers We
may explain that gold is invariably deliV-
cred IN the shape of gold certificates OF
deposit signed by the sub-Treasurer, and
of the denomination Of S., 600 or less
Gold, in bags or bulk, was long ago de-
elared to be not good delivery in con-
sequence of the frequent disputes arising
about "short count, and the dangers in
volved in the transmission of bags from
Office to Office. To deliver S15, 900, 600 OF
gold 8, 900 certificates would be required;
and it was said that the sub-Treasurer
had not so many on hand, and. had not
time to sign new ones IN season for Tues
DAVIS deliveries This was lucky for the
bulls in gold, and unlucky for the Secre-
tary. BY distributing the deliveries over
three days the money pressure proved
much less severe than it would have been
had the deliveries been all made on Tues
day. and the SecretaTy's victorious an
tagonists we're enabled to hold the gold
they had bought of him at 1901.
The question now was-which had won
the fight, the Secretary or the specula-
tors It was clear that after selling IN
all nearly $50, 1000, 900 of gold the Tress-
Jury had lost control of the market It's
reserve was now reduced so low that 1t
could not afford to sell any further amount
large enough to frighten dealers; In a a
word, it had done what its friends had
threatened it would do-poured out upon
the heads of the spectators its gold by
the ten and fifteen millions in day, and
the markekshad taken it and the pFeml-
urn had advanced. Thus far, then, clear
lv. Mr.. McCuIloeh, like Mr.. Chase, had
been beaten.
! But the question remained-how were
the SIS. 900. 900 in gold sold by Mr.. Myers
on Monday afternoon to be paid for .
Mr.. Myers had the right to deliver every
dollar of this gold on Tuesday, and to
demand greenbacks in payment. This
was what Mr.. McCulloch's friends said ne
would do. Had this been done, so severe
n money pressure would have ensued that
gold would inevitably have fallen back
below $50, probably to l25, and the
Treasury might at that figure have taken
back some of the coin so recklessly sold
on Monday afternoon at SO5(9l3Of:-
The banks were in the widest treplda-
ton. A renewal Of the panic oil April,
1864, was expected. Gold spectators
themselves trembled at the position IN
which they had got, and began to regret
that they had undertaken to light the
Taeasury. They entered the gold-room
on Tuesday morning feeling any thing
but exultant.
But this matter of delay was not the
only favor granted by the Secretary to
the parties who had defeated him IN the
| Gold-roon. Lest they should expert
ence undue difficulty in paying for their
/ cold, the Sub-Treasurer was authorized
to receive as money debt-certihcates not
vet due, compound interest notes at tnelr
face value with interest, and deposit GER
/ tifcates without notice. OF the two lat
| ter classes he did receive about 81 ,300, ,000i
of debt certificates, perhaps S4,OVO,OV0