Fayette County herald. [volume] (Washington [Washington Court House], Fayette County, O. [Ohio]) 1860-1???, 1873-09-25

COU !
Jay cooke * Co. Failed.
The startling news of the failure OF the
popular clearinghouse of Jay Cooke &
Co., at New York, was announced on Thurs
day last The bank paid out until its
means on hand became exhausted, and
their branch houses in Washington City
and Philadelphia closed their doors. The
failures are supposed to be on account of
the loss of confidence in the value of rail-
road stocks, in which this banking compa- |
ny had largely invested its means; conse-
ouently, run was made upon the banks |
by their depositors. This failure has also |
caused Temporarily, it is hoped,) the sus-
pension Of q number of other banks and
business houses in the large cities. Under
these circumstances, probably, pretty
general stringency in monitary affairs, for
time at least, will be the result But,
at this time, it is not possible for any one
to tell the extent of these failures, or the
effect they will finally have upon the bus
mess operations of the country. is GER
tain that there is at this writing great
panic among business men; but it is to be
hoped, that when the nervous excitement
passes off, a clear sky will be visible and
that business will not be retarded to as
great an extent as at first the signs of the
times seemed TO indicate.
Below we publish some editorials on the
subject of these failures from the Cincin-
natl Gazette:
The responsibility for the Panic.
The crisis was brought on by the sus-
pension of J. Cooke & Co., the most ex-
| tensive and widely known banking house
in the country. Their embarras B Rnts came
I through the extension of their advances
to the construction of the Northern Pacific
Railroad. The failure Of so large and well
known a house raised an alarm for other
houses which were financial agents of rail-
roads, and the run on them broke them
and widened the alarm. 1t is not supposed
that these other houses were insolvent or
that they could not have continued pay
ment under any but extraordinary eORdi-
tions. These failures caused a general
decline in railroad securities, the most re-
liable dividend stocks sharing it., and the
spreading run upon the banks caused such
as they had advanced on to be thrown up
on the market, to the general slaughter of
the owners. Many millions of value in as
sets were thus wiped out in day, extin-
gushing by so much the resources to
stand the run.
This crisis was not brought on by an
unusual expansion of credit in the general
trade nor by stock speculations, nor by
bubble banking" or banking without cap
ital. Its very few victims were of the
strongest houses in the country. 1t was
, caused by exters ons Of credit to legiti.
mate railroad enterprises. for their con
struction or equipment. 1t is the furthest
possible from any collapse at which people
| sh, ,1uld rejoice, or of unwholesome spec
ulatit,n. True, it is said, these railroads
are in n, a,lvance Of the wants Of the coun.
trv Rut is rot that the American custom
| n Is generally found that the railroads
Themselves fetch the country to their ad
vance. We go Sc far as to build railroads
to settle a country. Jay Cookies was one
of this character. And This was not with.
out substantial basis; for it has lanC
grant estimated at forty seven million
acres by those who profess to think 1t sc
valuable that this failure will be good for
1 tune to the nation if it gets back the IaDo
with the loss of the road.
But for the suspension of Jay Cooke
Co., it is probable that none of the Other
railroad financial agencies would have eE'
perienced any embarrassment, and that
there would have been no crisis or panic.
1t is all the working of general fright, in
which men act like stampede of an army
or a train of mules. Unfortunately the
purely business undertaking of Jay Cooke,
| which depended upon public confidence,
has had to encounter partisan hostility be.
| cause of his former relations with the Re-
publican administration. 1t was for the
interest of all that he should carry through
this vast undertaking; but there was a par
tisan disposition to stab him by defeat
ing the project There were others who
thought he had got hold of rich mine,
and that somehow they were wronged be-
cause they did not share it. These went
to work like pirates, or blackmailers, to
ruin his reputation, and to publish his un-
dertaking as a fraud A man of high
character, who had acquired fortune by
business before the war, and had greatly
added to it; who had shown real genius as
we'll as great courage in the aid he gave to
the government; who had large fortune
and reputation, and everything embarked
in this undertaking, and who knew what
its ulterior basis was before he went into
it, they assailed him as if he were com
mon swindler, because he set out to builC
a railroad to open a wilderness.
This way of venting partisan hate, Oh
personal spite, OF blackmailing propensi
ties, was as if one should set fire to grea
city because he had a spite against some
person in it. One is no more criminal ant
shows no more lower nature than the 9th
nh Il r IL
] road, and the general ignorance of its char
: acter, gave an open field for the working
! of this party meanness, and the more Eel
terprising calumny' and hired misrepre
sentation in advertising to the American
people that the project was 'swindle,"
/ thumbug'' and "cheat." Character an
Y the truth are the things known to the few
+ Calumny and misrepresentation are easil,
spread over the whole world. An under
taking founded on a generous confdene
: in popular support in placing the bonds t.
build the road and make its lands available
could not stand all these elements of hos
I tility. The sale of bonds ceased. Tn
s construction engagements already entere
4 into, strained the revenues of the house {
" jay Cooke s. Co. Their failure brough
all this train of disasters which will leav
8 a multitude of wrecks of men who were i
, solvent condition. It is a sad scene of rui
of innocent and hon rable men; but W
suppose that in the general confagratio
some partisan and some petty persons
k spite is grati1ed, and that is something
TCincinnati Gazette.
/ The Monetary Situation.
d The New York banks have associate
: themselves for mutual support, and hay
resolved to issue ten millions of clearin
house certificates to lend to any bank sui
5 jected to pressure that can furnish requi
a ed security. The union for defense