Wilmington journal. [volume] (Wilmington, N.C.) 1844-1895, 1867-08-30
From the National Intelligencer.

The condition of financial and business
affairs in the North and West becomes daily
more critical. New York journals expressed
the belief the other day that large failures
IN trade were nearly over, and that safer
bottom had been reached. But the fact is,
that we have but just reached the point
| where expansion ends and contraction be-
gins. While the currency was increasing
by the issue of national bank paper, in ad-
dltion to the enormous amount of green
backs put afoat for the purposes of the
war, everything was prosperous, and spec
ulation ragged and thrived. Nothing could
be touched by purchaser that did not
double or quadruple in value within few
| days or hours.
The more wild and reckless the specula-
ton, the more certain was it Of success. -
There is story of mailman who escaped
from his keepers, and before he was caught
had made speculation, and, of course, a
fortune. Mines, OIL wells, railroads, and
other stocks were among the favorite sub
jects of speculation, and millions of
1rredeemabie paper money were ready
to be employed in these purchases
lmpOrtatlons were, of course, expected,
and millions OF government securities, as
well as the gold product of the country,
were used in those payments. But the
Hood-t1de of paper money was to reach its
highest mark. There was a legal limit to
it. The effort to pass it failed. Then, of
course, the tide ceased to rise higher. and
the vast amount of Indebtedness could not
be longer foated without further issue of
paper. Congress and the Treasury went in
for the efforts of the infationists to in
crease the volume of paper, and the ten
dency is a reduction-gradual, but certain.
The amount of Government bonds with
drawn, under the law, has not been large
enough to have any serviceable effect, but
the absorption of the compound-interestt
notes, which were held by banks as a part
OF their reserve, instead of legal tenders, !
will tend towards the same end. There
tore, speculation has been suddenly check |
ed, and spectators and the banks, and
capitalists supporting them, have come to |
grief.
The reaction has but Just commenced,
and it is already visible in failures and in a
general stagnation of trade, and in the ac-
emulation of funds in the commercial
centres, where they lie idle, or are offered
at low rate of interest upon call, with
Government bonds as collateral security.
The vast and profigate expenditure of
money In conducting business affairs and
IN private living has greatly assisted to
Drlng about the collapse. A dry goods |
hrnI that failed some weeks ago in New I
York had paid a rent of over fifty thousand
dollars; their business expenses, besides,
were hundred thousand dollars, and their
private expenses were on still larger scale.
The cost of riotous living and unnecessary
pomp and display in business would &C
count for bankruptcy.
We are startled by intelligence of heavy
business failures in Providence, resulting
not from legitimate business, but from
sheer speculation. Things must become
much worse before they can be better
When contraction shall take place and be-
come the settled policy of the Government,
business affairs will be accommodated to it,
instead of being, as they have been for two
or three years past, until recently, based
on constantly increasing amount of paper
currency.
The Eastern States have been, through
a mistaken policy, supplied with an undue
share Of the currency allowed by law for
the several portions Of the country. Conf;