The New York herald. [volume] (New York [N.Y.]) 1840-1920, 1869-10-04
FINANCIAL AND COMMERCE.


dreamed OF the immense commotion they were about
to produce. Even when their ''cornern eliminated
Q week ago Friday the immediate future OF the
stock market was an unknown sea, whose waters
they knew not were to be upheaved by so fearful a
storm. 1t Is undoubted fact also that the stock
cIiques who were on the bear side Of the specua-
sion, in their widest imagining of great profits, fan
cled not the depth TO which the market was
TO be plunged. 1t was time in which
all sides lost money. Some vast fortunes
for the 'bearsn were not content to remain
out Of their stocks, but loaded up midway Of the de-
scent and were swamped in the ultimate decline.
Such reversal OF all preccdents OF Wall street was
never known. The professional class OF spectators
were tho heaviest losers. The shrlngase or values
In the stocks which daily carried IN Wall street
was not less than fifty millions OF dolars-an oblite
ration OF money which reached everybody. The
story Of the week Will long be remembered in hnan-
Cial circles The Morse panic OF 1864 was inferior IN
general nteresr for its results were conaaed to q
few inflated stocks. But the panic OF 1869 visited
everything III the shape or stocks and oc-
Casioned depreciation OF from three to
sixty per cent the average reaching. pro.
badly, thirty per cent. There Is reasonable
ground for the belief that the The crisis has
now gone by, 1t is no secre, that the shrewdest
dnancers feared the precipitation OF general panic
by these disastrous occurrences. EaJ here again we
ind not a repetition Of 1861, but more positive
reproduction OF 1864. In the former year the coun
try was more susceptible OF panic owing to the
widespread system OF State banks, whose redund-
ant circulation easily paved the way for suspension
when specie demanded Tor bank notes. Last week
the idea OF run upon the banks entered very few
heads. Specie was not to be had Tor the money IN
circulation, and the currency In OF out OF bank was
tnexibo in value. The only danger was TO depositors
in banks whose officials III their greed for large gains
had taken the risk Of loans en- the depreciating
securities OF the Stock Exchange. III such instances,
however the first multering OF tbs storm In the pre-
vi0us week had been a warning that had not been
unheedeu and there Is reason for believing that few
II any Of our banks were losers by unredeemed col
laterals. The crisis has afforded the most sat-
isfactOry evidence OF the TACT thai our greenback
system OF currency Is the best one which could be
devised. It's stability in the wild fluctuations OF
gold shows that it has attained consi5-
tency OF value greatly underrated When
gold was at $50 greenbacSs were nom-
tnally CT, It is true. but in general business
their purchasing power was ncne tho less. Gold,
which by the operations OF spectators had become
merely specializing vehicle like any railway stock,
was inflated beyond its real value. Had the gold
bubble continued longer 1t would have exploded OF
ITSELF The world at large would nnvor make SO
wide o difference between our currency and gold.
The latter would have flowed here III coplous streams
as the cheapest means of paying for our exports.
The fact Is, the gold "corner" was like The Harlem
scorner'' and similar operations. Had the govern
ment pursued o consistent policy we should not
have had the panic MI. Boutwell,, had he persisted
In his deter animation to let the market Alone would
have received no blame; Tor the corner would have
ended as did that in Harlem. by the disastrous
losses OF the shorts, but without any panic or gene
yal devastation. Speculative and natural causes
would have remedied the matter. Mr.. Boutwelrs
mistake lay in his interference at too late mo-
ment II he ought to have interfered at all, which IS
mooted point. However, there is no action with.
out reaction The panic has caused great losses,
but only among the people who live by Wall street
speculations. The Crisis hos not extended beyond
che four streets which environ the stock Exchange
The rise IL stocks ever since the scrip DIVIDEND Oh
New York Central made mems fortunes between
Saturday night and Monday morning, ana turned
the heads OF fortune seekers with envy. There mas
been diversion Of public interest to Wall street
which was preudicla to sound business. The
minds OF the people, in the city ana elsewhere,
have been absorbed with the news OF the stock mar
ket Tho financial column of the daily papers mas
had vast accession OF readers. Butnow the dream 10
dssipated. Fortunes can be lost as well as made IN
wall street. Speculation is not SO sure road to
a thunder storm, and the prospect Is all the farer
for IL. The events OF the week viii work reaction
and revival In the more legitimate channels OF busi
ness Let the next session OF Congress pay more
attanton to the financial question: and we shall avoid
repeattng the history OF England In passing through
a suspension Of specie payments. The period OF
paper mutations has lost Its dangers for us. The
country is growing so rapidly that 1t needs circu'
lation not less than the paper anoat. contempt
rary happily observes:-'f elasticity Is one OF the
Qualities our currency lacks stability must be con-
ceded to be its most prominent excellence. 1t has
often been observed that ever since the suspension
OF specie payments interior trade has been more
stable and less distributed than ever before, and
that It showed fewer signs OF distress when there
has been any interruption OF foreign commerce OF
any revulsion in foreign money markets. For
merry our banks were terrified beyond mea
sure when the Bank Of England or the
Bank OF Franco were IN any disorder
A rise in the Bank OF England rate would
produce all immediate response here, aud If we had
mad the Atlantic cable In those days should have
had the frequent anomaly OF a Bank OF England
movement this afternoon In London, producing q
fail or rise in our securities in Wall street this
morning AS 1t is now, however, We care Little for
the movements OF the Bank OF England"
The bank statement OF Saturday shows the con
SENTATIVE policy which the banks were forced &c
pursue during the week. The line Of loans
has been contracted to the extent OF ovei
eight millions Of dollars. The increase Of
specie, owing to the governments sales, has been
nearly two millions, and that OF legal tenders
owing to the government purchases OF bonds, over
four Millions Despite this the deposits have
Increased nearly three millions an apparent veri6
cation Of the reports that at and after the great
decline in stocks on Wednesday last there were
heavy cash orders to buy from all sections OF the
country The increase in the OF the banks is
she most atterng feature OF the exhibit The totals
Of the last two statements are conrasted as FOL
lows
Sept -. Oct. q
Loans S2b3,iu,slS $780, go GAG
Specie ................... 13,9js,isi 1902, SAG
Circulation. ............. 33,gg60Si "a, 100, 400
Deposits. 1920, 1903 1885, COS
Legal Tenders. ......... 6o,o25,0Sl 04,209,0sd