The New York herald. [volume] (New York [N.Y.]) 1840-1920, 1870-07-18
FINANCIAL and COMMERCIAL.
WALL STREET,
SUNDAY, July II, 1870.

The Wall street markets during the week nave
been almost entirely affected by the influences aris-
ing out OF the war news from Europe. Home influ.
ences were quite lost sight OF The almanac tells US
I'm dry weather all signs fan so in local financial
circles the Currency bll the Funding bill and otner
domestic causes have been Overshad0wed by the
important events abroad 1t is an open question
what effect the Congressional measures referred
to would have had upon prices. For the present
they are imperative, particularly the Funding bill,
which was dependent for Its success upon such an
appreciation OF our securities would have left 1t
possible to place the new loan upon the market.
Moreover, many authorities contend that as there
has been repeal OF the Public Credit bill passed
the previous session, which prevents the redemp.
ton in coin at par OF the fvetwenties until
greenbacIs are at par in gold the law Is dead letter
until we shall nave resumed specie payments. The
most important effect Of the war news has been the
stimulus II has given to an upward movement in the
gold premium. The foundation Of this movement
lies in the belief that the different countries OF
Europe In the activity and excitement attendant
upon the commencement Of hOstitles will make
money 80 valuable that gold will DO the
cheapest export we can make them. 30 far
the shipment Of specie has not been inordinate. 1t
Is the season Of the year when such shipments
reach their maximum. OF our ability to stand large
drain we have guarantee In the bank statement,
which shows total in the banks at present of over
forty one millions OF specie. But to be doubted
that we shall be governed in this war by the pre-.
cedents OF previous wars in Europe Heretofore we
have held comparatively unknown place in the
finances OF the world. In 1858 1t was quite
natural that the European capitalists who were ex
perimenting in securities should have been easily
induced to send them home for realization. Since
that time however, we have given signal proof OF
our stability, national importance and financial
soundness that the situation Is entirely altered. II
true that 80 far the quotations foour avetwenties
abroad have declined with the progress OF the war
idea but the fact should not be lost sight OF that in the
pressure to realize upon everything In the shape OF
paper Indebtedness the current of sales has carried
prices below intrinsic values There large guam
titles of our nve-twentes held on speculation IN the
large cities or Europe In a time Of excitement Sc
curities so held are forced upon the market
with consequent sharp decline IN prices. II
Is the knowledge Of the real situation
which has so far prevented sharp advance
In gold. The American public are confident that
war in Europe, however selfish the idea means bet
ter times here Hence while the first furry has
depressed our securities in Europe they believe that
reaction is inevitable, the extent and importance
of which will be measured by the prolongation OF
the struggle and the accompanying prostration Of
foreign industries For this reason the specu.
lators who are operating for rise In
gold are treading on very dangerous
ground. 1t may be that gold will
go higher, but far 1t has made little progress In
comparison to the efforts and influences exerted for
an advance. The danger Of holding it lies in the
uncertainty when the tide will turn and legitimate
influences assert their power. Gold in rising is
sign that our national credit is depreciating. Now,
there Ia not person In all Wall street prepared to
say that we shall not be the gamers by the war; pub
licly and privately. An advance In gold Is
therefore illogical, and due for the present to
the simple fact that the sales OF our bonds In Lon
don and Frankfort have been more than the mar
kets there were prepared to absorb In so brief O
time. When, however, the reaction comes, and
capital with lis well known timidity, seeks secure
investment, the demand for our bonds will, in the
estimation Of many LEAD to gold shipments from
Europe, particularly as our markets will DO the
principal source or supply 10 all Europe.
The stock market at the beginning Of the week
was heavy and dull, and was tardy in responding to
The agitation produced by the war news. AS the
week advanced the feeling became general that
gold advanced stocks should decline, and hence q
sharp decline ensued when on Friday gold rose to
1867. The extraordinary features Of the bank
statement, showing O wonderful improvement In
resources, turned the tide on the last day
Of the week, when the previous decline
OF four to eight per cent
diminished two to four per cent. Money was more
active, and IN exceptional instances six per
paid on CALL
Governments dropped under the war news par
ticularly as the foreign bankers heavy sellers
on speculative account But the lower prices bought
in domestic investors and the market after resisting
the decline obstinately, suddenly advanced ut the
close.
THE BANK STATEMENT.
The weekly bank statement was general surprise
70 the street on account OF the remarkable changes
from the previous exhibit. The gain in specie is
about five and half millions, with trining increase
In legal tenders. The accession Of so much coin to
the reserve OF the banks Is due TO general move
ment on the part OF the community to sell out at the
present high price OF gold. The gold coin recently
paid out by the government for July interest the
public debt, while largely absorbed at once by the
banks, found Its way into the purses OF
many private individuals. They received IL
when gold was Ill 1l2 Very naturally they took
advantage OF the chance to realize during the week,
under the belief that whatever happens to the credit
OF foreign nations grcenbacks better to hold than
CON- The leading bankers report the receipt OF
large sums from the country TO be disposed OF for
the above reason. The active speculation in the
Gold Room the part OF the professional operators
led TO an increased demand for money at bank, and
the loans have been Increased seven and half
millions, the banks being able to grant the further
accommodation owing to the increase OF reserve.
Tho effect has been an increase Of over fourteen
millions in the deposits despite which the surplus
reserve Of the banks has increased over two
millions. The next important feature Is sudden
decrease Of million dollars in the circulation
Of the city banks. The figures OF this item
much out OF proportion to the ordinary weekly
change that for time 1t was supposed error had
been made by the transpositlon OF the items of
circulation and legal tenders. 1t seems, however,
that since the passage Of the Currency bill, with
its provision for the compulsory redistribution
Of twenty-five millions OF Northern banking capital,
some Of the city banks have taken time by the
foreock and have commenced to sell for con-
sideration privileges Of which they will be