The south-western. [volume] (Shreveport, La.) 1852-1870, 1869-06-09
American Credit Abroad.

THE London Daily News OF the Sth says
In estimating the possible scope Of this monetary
disturbance is very Important to bear in mind that
trade has little or nothing to do with it, the embar
rassment arises almost exclusively from excessive
imports of foreign stocks American and Continental
and from our engagements III foreign loans The
latter branch of the subject calls for special attention
because holdings in scrip entail financial oh
legations in the future which cannot get rid of so
easily in Of paid up stocks having free cur
rency throughout She markets of the world The col
lapse which has taken place to-day in this class OF
property shows how ra its basis under the existing
conditions Senator Sumner makes exaggerated
speech-the Bank of England raises its of dis.
count per cent, and the foreign stock market is at
once thrown into state of panic Upon the inherent
unsoundness OF this department OF the Stock Exchange,
resulting from the fact that very large amount OF
foreign stock is held merely upon borrowed money,
instead Of being placed among bona de investors, we
have elate repeatedly The prices of foreign
stocks had been carried by spectators to point at
which the London market constantly attracting
fresh supplies from all quarters. Had the movement
proceeded much further, might have found our
selves plunged into deep Embarrassment The pres
en reaction may be regarded natural aud very sal
utary decided check. though, OF course, involving
much loss to individuals, was greatly required owing
the low value of money which prevailed SO long, and
to the lamentable feeling OF dstrust OF home Jontstock
enterprise, foreign governments have lately had an
opportunity theg soreY wanted. For something like
two years they may be said to have almost monopo-
Used the English Market borrowing freely at eXorbi-
tant rates of interest and at least, consistent in
respect, in showing an utter want OF consdera-
ton for the interest of the holders OF their previous
loans All these issues have now fallen together,
as might have been expected, at the first signal Of
alarm, whether in the political or financial world.
The London Star OF May s, says: The alteration Of
the bank rate has told very heavily upon the markets
to-day. The business community appear to have been
completely taken by surprise and their attention av-
ing been drawn to the bank reserve, they find it 40
much worse than they expected that the result has
been Il species of incpient panic. An attempt has
heen aade to draw off the attention Of the public
from the real difficulty, viz: the nsuicency Of our
banking arrangements to meet the greatly extended
business of modern times by representing the advance
in the rate as the consequence of advances the m
vestments in fve-tWeity bonds. A threat has been
held over the business community that the Bank will
put stop the business, if the should be
raised to five ten per cent. According to this
thority, it is the mission of the bank to "check the
ardor Of those who placing their money on these
securities This is version of the Banks mis-
son which, probably the directors will not thank any
for announcing on their behalf The business OF
the city of London is free to ALL and especially III the
matter of the bonds and loans of foreign governments
the door has been shut. We are also told that
about ;el50000 900 Of United States bonds held
Europe and that other foreign bonds must pale be-
fore this total But it will be observed that
this is held in Europe" and not in England
that it is scattered from Amsterdam to Florence, and
is, above ALL largely deposited in thrifty Holland and
careful Germany. 1t must also be kept in view, that
this amount has been gradually accommodating during
and since the var that is sudden accession to
securities; and moreover that Europe did pay el5O
100000 for what is row worth that sum by the gradual
improvement Of the value of these bonds 1t is hard
to why it should be the special mission of the Bank
of England to punish, BY raising the rate the whole
commercial community, because number Of capital
lists choose to make themselves creditors of the United
States. There is nothing childish than to sup
pose the Bark control the kind of investments or
trade which may be INDUCED in. If it is profitable,
it will be continued if not it will be abandoned and
if the former the Bank and the country will have to
shape their financial arrangements to the trade
and not to attempt to kill it off by raising the