Nashville union and American. [volume] (Nashville, Tenn.) 1868-1875, 1873-10-03
HOW WILL THE PANIC AFFECT
RAILROAD PROGRESS?

The following is a summary Of the views
expressed by the New YORK Bulletin of the
22d ult., as to the effects of the panic upon
the railroad and iron interests: That the
consequences OF the.recent shock will be
far-reaching, is very evident. The new
railroad projects of Baron Reuter-, of Persia,
and the railway development of China and
japan, now in its infancy, will be affected
to greater or less extent. So far as relates
to our own country, for several years to
come it will be difficult to obtain money for
any but the very best dividend-earning sec
urities, and it is probably safe to assume
that during that period, no new
railroad projects win be attempted, except
such as promise to supply an existing press
ing demand, while On those lines now
in course of construction, work is
likely TO be suspended on all
bat those in which SO much money
hss be en- already invested as to render the
losses from suspension greater than the
risks Of completion. In the new North
western States and Territories, aud possibly
in some of the older Southern States, pro-
gress is 50 dependent on railroad develop
ment that the temporary arrest of railroad
construction is calculated to bri5g the farm
ers TO realizing sense of the philosophy of
capital and transportation. But it is upon
the iron trade that even the temporary sus-
pension of railroad building will produce the
most decisive influence. The railroad COM
paDies are the heaviest consumers of iron.
Last year 100000 tons of domestic and
$4,000 tons of foreign rails, making a
total Of 100000 tors, were used in the
construction of railroads in the United
States. Next year it is probable that
not more than half that amount will
be required. As q rule, business is like
ly to be restricted to the completion of |
existing contracts and repairs. No doubt |
q considerable quantity Of iron will be re-
quired for these purposes. But we have |
been building railroads at the rate of five |
miles year, and contraction of |
one-half, or even one-third of that amount |
would seriously affect the market for rail- |
road iron. But while it is impossible to ig-
more the effects of the railroad panic upon
the American iron trade, its effects on the |
English trade will be scarcely less marked. |
The importAtions of railroad iron for the
week ending Sept Is amount to $3.50
bars, and to 477,505 bars from he LIST of
January 20 that date, against 783,794 bars
Turing the corresponding period last year.
This curtailment Of the American demand
exercised very serious influence upon the
English iron industry, and the prospects Of its
urther diminution are calculated to produce
still more depressing result. 1t may reason
IDLY be assumed that the shock to the Ameri-
,sn railroad credit will extend throughout
he world. In Germany, Italy, and more par
icularly in Russia, railroad speculation is
7ery active, and a great number OF new
ines are either in course of actual construc-
ion or ara projected. Even China and
jSpan are entering upon career of rail-
Dad enterprise, and Baron Reuter- has al
eady commenced bis vast system of Per-
ian railroads. With the American exam
lie fresh before them, capitalists will every
where scrutinize much more carefully than
'ver before the projects submitted them.
People viii be more careful before they in.
'est their savings in enterprises of which
hey have no personal knowledge. The re-
ult will be fewer new railroads, falling off
D the demand for foreign railroad iron,
which constitutes large proportion of iron
The Bulletin concludes
With the remark that this dimiDution in
abroad activity viii be only temporary.
The capital heretofore invested in railroads |
will be transferred to other branches of in
ustry, with the result of necessitsting atm
iStant time renewal of railroad activity
n larger and more extensive scale than
yer before.