The Rutland daily globe. [volume] (Rutland, Vt.) 1873-1877, 1873-09-29

Whilst great emergency or disaster is
pending, and the courage and energy of
men must be devoted TO stemmng the
adverse current of the moment, 1t Is
scarcely the proper time to reflect upon the
causes which have led to the misfortunes
under which they are laboring, but. never
theless, there are some conclusions in re.
gard to the existing financial panic which
strike us SO forceably that it Is impossible
to cast them aside. Criticism upon the
system which has been at the root of the
present troubles Is very much like locking
the stable door after the horse is stolen,
but If we fully understand the beginning
of them, We are all the more likely to
steer clear of such disastrous courses in
the future 1t is very easy 10 compre-
bend now that we have built the fire and
then put our heads in it. When tre-
mendous railroad enterprises were project
ed and private banking houses undertook
to float what it would have required the
capital of n nation 10 sustain there
was but one result possible. and
that was the one which we arc now
facing. They actel up to the American
principle of living upon fictitious values
drawing drafts upon the future at heavy
discount, and when il became apparent
that these castles in the air had no substan-
tial foundation, they toppled and fell like
the gorgeous fabric of n dream. We have
all been going the pace too fast. and the
wind and muscle must have given ont some
day Let us look at the case of jay Cooke
4 Go. Here was house of the greatest
wealth and the largest resources They
were the Rothschlds of America. and their
capabilities seemed unbounded. As the
active agents of the Treasury Department
tka,s hoI onapnnIoJ IL, ,orrntto,;,,,. L., ;,,
mensc loans which enabled the Government
to continue war which cost million OF
dollars daily during the period of its exist
encc. They had supplied ii with lifc-blood
in their capacity of mddlc-mcn between Il
and the people. The nation came ont of
the prolonged struggle with strong credit
and a reliance upon its resources which
was felt in monetary circles throughout
the world. The iinanccrs of Euronc
did not hesitate to risk their money
upon its promises To pay. Our bonds were
favoritc securities in European markets.
and mt home the millionaire considered
them the soundcst representatives of his
fortunes. and the wnrkingman invested in
them his hart-carncd hundreds. That was
all right as far as il went. The credit of
the country was pledged IN the redemption
of its guarantees. and the world accepted
the guerdon But u speculative and con-
fdcnt spirit arose which has worked all the
mischief. Because the government could.
uuder pressure of war emergencies. afford
to live upon its promises and trade off the
earnings of the future tor the hard money
of the present. the feeling was created that
individuals and corporations could safely
do likewise. just emerging from war. it
was only natural that the American people
should turn their attention to the develop
mcnt of the country. The prospect was
fattering enough to turn the heads and
pervert the Judgment of WISER heads than
those which sit upon the shoulders OF This
enthusiastic sanguine race. New rail
roads to be driven through the wild re-
gions stretching westward to the Pacific.
and through the comparatively unpopu-
lated and unimprOyed Southern country,
to bring to market the products of these
fertile lands, to fill them with farms and
towns and manufactures. to build up n
greater America and cultivate the wealth
of the fallow ground--what wonder that
men were carried away by the glitter
ing prospect, and that their bright eX-
pectations they forgot the inevitable rule
that an enterprise. like an individual. must
keep out of debt. When money was want
ed to build railroads. it seemed plain
anu tilluS W IL anu ltlN UP
on the earnings of such enterprise for
payment. But unfortunately it was over
done. Cooke & Co.. for instance. under
took to carry the load of the Northern
Pacific railroad. Notwithstanding the
plain warning that the one trans-conti-
mental railroad already in existance
scarcely made enough to pay irr>i&-terest
on its debt. the new endcavOrS started
out under the most favorable auspices.
Its bonds sold well. and the great house
engineering it found no difficulty in plac-
| ing them upon the market and borrowing
money, until one day it became plain that
they were mortgaging the future too
heavily. The money was all going ont
and none was coming in. The crash was
inevitable, and it came
The same experience has been repeated
in other cases. Similar ehdeavors 10 build
railroads on borrowed capital have result
ed in like disasters, and SO we have been
brought to the present pass. The crisis
was fastened by the fact that when such
schemes became purely speculative they
fell Into the hands of the spectators, and
their stocks became the prey of Wall street
gamblers, the men who suhsSt and fattcn
upon system which is rs truly gambling
as any sharper's play over faro table.
One misfortune is, that thousands of peO-
pie of small means are severely crippled.
The seductive promises of high interest in
duced many a working man TO withdraw
his small capital from the savings banl,
and place it in these schemes. which prom.
Used him double interest. They suffer.
and they are the only ones 10 he commits
Grated.
For all this. we are still firm in our opin.
ion that no great national disaster is i'm
pending. Wall street operations nccessari.
ly involve greater or lesser proportion OF
the circulating money of the country. and
so the shock must be felt outside of the
circle which is Frustrated by it. But tho
legitimate business community is not hurt
seriously. 1t may be dashed by the fury OF
the storm into brief quietudc, and il may
deem it necessary to take prudent measures
to secure itself, hut such precautions dc
not mean that they are a last resort Tho
very force now expended is sure SIGN OF
speedy exhaustion. We are better off than
the panic-mongers would have us believe
We do not desire to underratc the gravity
of the situation, but the most serious dan.
ger is in 4 general fright and when the
trouble is over, as we believe it soon will
be, we shall have learned by sharp expert
encc the valuable lesson of conducting af.
fairs upon a sound basis We shall moi
again endeayor to conduct vast enterprises
upon borrowed money, and there must be-
solid prospect of immediate payment upon