The evening telegraph. [volume] (Philadelphia [Pa.]) 1864-1918, 1870-09-30

tember 10, has this paragraph
"In spite OF the strain upon financial affairs in Eu-
rope in consequence OF the war, United states
rites rise IN European markets. Tue truth is both
capitalists and the people who have any money to
invest begin to see that we not only pay higher
interest than any other great power the national
debt but that really there securities safer IL
safe, as ours. While other nations can scarcely
make both ends meet, while they have little ne
prospect OF paying their debts and while every ey-
raofdiLary strain upon their finances adds to their
Indebtedness, our country is paying OF It's debt at
the rate OF hundred millions and upwards a year.
In fact our debt, large as the figures are is but
bsgatelle when compared with the vast resources
and wonderful growth OF the country 1t is not sur
prising, then, that our bonds rise in the European
h , AZ - p npeeu, Inss they
tions. Whatever may happen in Europe, tn . wealth
and magnificent future OF the American republic
are such that 1t Will be no difficulty to meet its liab
ties and to pay OFF within few years the principal
Of the debt"
One of the very remarkable phenomena of the
war in Europe is the slight disturbance in finan-
cial affairs that have taken place. There have
been some days of panic in Paris, but every
where else throughout Europe with but the
slightest exceptions, financial affairs have
gone on about as usual No such thing ever
happened under similar circumstances be-
fore. For there is not only war, with no sure
prospect of its speedy termination between
two of the great powers, but civil commo-
tions are threatened in many parts of the con-
tinent Spain is in the condition of a vol
cano just preceding eruption. The temporal
power of the Papacy has just been thrown
suddenly and ridlculously down. A lowering
war cloud has already appeared in the East
England is nearer civil war than she has been
before for two centuries. And there has been
no general financial crisis whatever, whilst
United States bonds are steady in the market
improving rather than declining in price
If we search for the reason of this remark
able financial situation, we shall find it in the
very fact of the presence of United States
bonds in tte markets of Europe. The natu-
raj effect of war in q country is to make
money scarce. On account of the uncertain
ties of the future there is tendency to
hoard cash. Creditors call in their debts as
rapidly as possible, and put a stop to further
credits. Money that is owing abroad passes
out of the country. Hence great disturb
ances and fluctuations, and not seldom, on
the outbreak of war, disastrous panics
Heret ofore in Europe, all debts were paid
in gold and silver coin, which passed and
repassed from country to country, making
successive stringency and redundancy. But
now there is a substitute for coin, more
convenient, and hardly less popular, with
the advantage over coin of bearing interest
and increasing in value. This substitute is
composed of American securities More
salable than any other kind of property they
have served to pay debts between the different
countries, SO tnat violent disturbances IN the
circulating medium have thus been prevented.
And so it happens, singularly enough, that
the debt of the United States has prevented
calamitous financial crisis in Europe Aneri-
can securities have thus done service, or at
least been chiefly instrumental therein,
scarcely less beneficent to the people of
Europe than would be the prevention of war;
for the miseries resulting from a general
financial crash are only less than the miseries
resulting from war.
There is much to demand profound rehec-
tion by fipanciers in this notable situation.
1t is quite the reverse of what was generally
supposed would be the result of the war. 1t
was believed that our bonds would forthwith
be returned to the United States and sold for
what they would fetch in gold. On the con-
trary, it would appear that had the amount
held abroad been much larger than it is, it
might have been used to the great benefit of
the countries directly or indirectly affected as
to their finances by the war. We may readily
conclude that the result will inevitably be to
improve the price of our securities, in the
future, abroad, and also of course, at home.