The New York herald. [volume] (New York [N.Y.]) 1840-1920, 1868-10-27
vFiEL THERE BE A PSE-c.

Tise Present SiEingency IA the Honey Market
and ihe Decline in stocixs-Crif.cal state
81 Affairs In Wall street..
The present aspect Of financial affairs furnishes
FOOD for very serious reflection That affairs IN the
monsyed world OF the metropolis are IN very criti-
cal condition is Obvious to those who most
unwilling to decry danger in the future. Money ia
scarce-tlat Is, in the financial sense. II Is true
there is just az much money IN the country now as
there was few weeks ago; but the sudden with
drawa of $4,000 900 from circulation and tho panic
in the stock market here caused lenders to be ex-
freiicy cautious in their loans. They have also nd
vanced the rate to the legal and even beyond
the legal rate of interest-a device peculiar TO
wan street, Seven per cent Is, OF course, the rate
beyond which no lawful demand may be made, hut
there IS no statute TO prevent its payment in gold or
the exaciion OF commission equivalent to bonus,
Tor the use CT the money. Hence in the present
stringency borrowers nave been compelled to pay
high as ten to twelve per cent interest The cause
OF this sudden crisis in Wall street may be briefly
told and win he found an interesting narrative
just about the middle of September in each year
money always becomes active. 1t was little late
tins season. owing to the backwardness Of the cotton
crops in the South and to the retention Of the Western
crops by the farmers, who were seeking higher
prices. Money was abundant In the metropolis as
consequence, and was l0aning freely at four,
five and six per cent on what are known
as call loans. These are loans made upon
collateral such as stocks and bonds and liable to be
called In at the option OF the lender. The ease in
money induced the utmost speculation In the stock
MARKET and everything In the shape OF stocks was
bought with avidty. Prices ran up SO rapidly that
an advance OF twenty per cent took place in some OF
the railway stocks, particularly the Western ones,
within few weeks. The situation Afforded a fne
opportunity for grand ''bear" operation, by which
stocks could he sold at price below their market
value, and then by pressure forced below the con-
tract figure. SUCH At least. the view taken of IL
by prominent 'bearr firm, who induced others to
join them, aud large spool" was thus formed for
The purpose OF breaking down the stock market.
Stocks go up when money is plenty. Conversely,
they go down when money Is tight. Hence
the "pool' determined upon making money
tight as the first step to their speculation. Accord
ingly they borrowed money by depositng collateral
at the banks. The sum thus blamed they deposited
IN other banks, drew Leir checks against Ii and had
them certified. TIE cerlided checks they cashed at
still other banks and finally they locked the last
amounts IN their safes. Any one familiar with busi
ness at iic banks vii! see at once that with mil.
lion OF collateral the spectators could easily tic up,
or ''ock up" to use The yernacular Of Wall street,
the OF tirec four ye or rs many millions more
10 the scheme. The sum OF $3,0oo000 or s4.Oo0ooO
was thus locked up, and the spectators counted on
the usual activity Of money to help them. But money
did not become scarce for the reasons previously
cited and the remaining volume OF currency
panded 30 as to meet the requirements OF
business for few days. The attempt
was a naseo, and after short time
they took their ereenbacks out OF the safe and put
them in bank again. second attempt was made
q few weeks afterwards, cut IL hardly sue
cessul. The stock market In each instance vibrated
little but the scheme being seen through prices
remained firm and the spectators retired van
qui4lied.
Tire third and the mos, successful attempf was
inagurated hast MonGay and Tuesday, when the
SUN Of SO OO00 was suddenly Withdrawn from cir
cuaion by the same 'rDc'n and by the same flock
ing up- process. The game begaa. 10 be des-
pcratc one on their part. Tue stock market refused
to respond they wished to the tightncss In money,
and the screw was applied by the withdrawal
Thursday Of three lniliions more OF greenbacSs.
still the market was obstinate. Tue Western rail-
way shares broke under the pressure, it Is true. be-
cause they the most largely inflated by The pre-
v.ous mama for speculation. Tie objective point
was Erie. however, and that stock continued
frn. A further withdrawal or money was managed,
and Erie, after lighting hard all day Friday. fell from
told. The withdrawal OF more rreennacks, until the
sum or s15, 900, 0ru was taken from circulation
pietcd the rout OF the stock market, and the Whole
list wavered ana broke. Erie fell, rose again half
way, end then reapsed 10 about %. The yi,tors
not content as vet They still pursuing the van
pushed Erie with the threat that hey viii drive IL
down To IS. Meantime the greenbacks are locked
up. when It Is remembered that the total currency
in New York city Is only from $50,000O0o 10 ESQ., 00O-
900 IL is easy 10 ind for the pinch In money
when SIS 000 are taken out OF circulation. The
worst feature or the situation Is that the artificial
stringercy IL likely 10 be aggravated by natural
Que owing TO demand for money IN legitimate
business operations, such a. the movement Of the
crops and the ike which suspended until this
time. several OF the banks are Implicated in this
grand scheme Of the 'bears and when the crisis is
over they should be remembered accordingly.
Such Is the condition VI affairs at this moment.
Where IL viii end what 1t Will result In spccu-
ations Cor those who yersed in financial philoso-
ply Tit succeeds In curting the speculative maria
now largely possessing moneyed men and brings
capital back into legitimate channels; If IL cures the
great ambition Of the day make fortunes In few
hours at the stock Exchange, and II imparts
stimulus 10 honest business transactions, viii not
have been without its good. despite the millions OF
dollars that have been gambled away IN Wall street
within the present brief calendar month
SURPRISE OF BURGLARS IN CisaL STREET.
~~~~>~~->re-s,>>>~-~~~,
One ~ them Caushf-Annthcr sccpcs-Thc
PInuder Recovered.
~ the surpriSc of n gang OF burglars Yesterday