The true northerner. [volume] (Paw Paw, Mich.) 1855-1920, 1873-09-26
THE FINANCIAL PANIC.
The Failure OF Jay Cooke a. Co.-0ther
suspe nsions Follow ina Rapid Success
sion-rhe Excitement at New York,
PhiIade Iphfa, and Other Points.

New YORK, Sept 1S.-Another day of in
tense excitement has passed over Wall street.
Early this morning predictions were made
that this would be a hard day, and one that
would see the downfall Of more than one
financial house. The Chicago fire. it was
thought, would occasion drain upon deposits
and tend to panic. Stocks for the first two
or three hours huctuatad wonderfully. West
ern Union fell 10 per cent. without an upward
struggle, but about noon recovered it's opening
figure At noon the report was whispered
that the house of Jay Cooke 4 Co. had sus-
pended. At first the rumor was considered an
idle one, or at most started by some scheming
faction. However, it had great effect. Men
and boys ran races from Office to Office. The
telegraph was incessant in it's operations, and
the excitement grew intense. Shortly after
II M, it was officially announced that the sus-
pension had occurred the reasons therefor
being advances made to their Philadelphia
| house. which rendered them unable to
| meet the demand made upon them by their
depositors here. AS soon as it became gener-
ally known that Jay Cooke 4 Co. had sus-
pended, many rumors touching other promi-
Gent houses sp-1ng into existence, but all
reports about the Suspension OF firms except
| ing Jay OOOAe TO-, DCuell, anu the
small firm OF Robinson, Suydam & Co.. upon
investigation proved to be without Foundation.
! When this fact was made known on the streets,
confidence was again restored, and at the
close OF business stronger feeling prevailed.
The liabilities of jaw Cooke 4 Co. cannot be
ascertained. 1t will take some time to make
a statement of the affairs of the house. The
creditors are mostly banks and bankers, there
being but few individual depositors in the list.
The suspension will greatly interfere with the
operations of the Syndicate, and probably sus-
pend the negotiation of 5 per cents.
The Tribune says: Late this evening the
following reasons were given by Mr.. Fahne-
stock, one of the firm Of Jay Cooke & Co.,
for the failure of the house. For several
weeks the uneasy feeling which prevailed i'll
connection with the new railroad schemes
| caused heavy drains upon the deposits both
of their Philadelphia and New York houses.
The deposits in both cities suffered continual
diminution, until at the beginning of.the pres
ent month, their deposits were lower than at
any time during the last fall and this spring.
The drain upon deposits already so heavy, was
still further increased by the recent suspen-
slons and demand for money was incessant,
| and IL felt still more severely i'll Philadelphia.
The Philadelphia house was compelled to call
upon the New York house for aid and a large
| amount of assistance was rendered. The
Philadelphia house was under large advances
| to the Northern Pacific Railroad Company, in
| volvlng large sums of money preventing them
1 from maintaining the reserve ordinarily kept,
| and they were therefore unable to respond to
the demands of their creditors. For this rea-
! son they were unable to return to the New
York house advances made by the latter, or to
| supply them with any collaterals available in
! New York at the present time. Owing TO this
! the cash balances became exhausted, and sus-
| pension became inevitable. Fahnestock said
| that of course the different members of the
firm were possessed of large amount Of pr-
vate and personal property, but none of this
was available i'll an emergency such as the
| present He was not at the present time, nor
was any member Of the firm, prepared to tell
the exact amount of liabilities or assets of the
firm. He believed that all the creditors would
be paid in full, and hoped that the suspension
would only be temporary. On this point
nothing could positively be said at present
and some time must necessarily elapse before
the exact amount OF private property Of the
firm can be decided"
PHILADELPHIA, Pa, Sept. 1S.-Third street
was thrown into an uproar at IL o'clock this
morning by the report that the old banking
house of Jay Cooke & Co. had suspended
The rumor caused the most intense excitement
| amid all circles and the intelligence flew frem
mouth TO mouth with lightning rapidity. Per-
SONS interested, as well rs those not interest
ed, turned their steps toward the Office on
| Third street to see for themselves the condi-
ton of affairs. Very soon constant stream
of people was seen debouching from all the
was filed with people, all intently and excited
ly looking at the building The doors were
closed and guarded by officers, and all except
those having business with the firm were pre-
vented from entering.
MIR. Cooke, Sr., authorized the posting of
notice on the doors. The crowd then rushed
toward the spot, all being DESTROYS of seeing
and reading for themselves what was upon it,
This was impossible, and voice from the
crowd cried out, Read it alond." The demand
for this increased, fifty voices seconding the
request whereupon Mr.. ID. NJ Longstreth
read aloud, to be heard in the middle of the
street, the following:
ITO THE PUBLIC: We regret to be obliged
TO announce that owing to the unexpected de-
mands upon us, our Office has been obliged to
suspend payment. In few days we will be
able to present statement of our affairs to
our creditors. Until that time, we must ask
for their patient consideration. We believe
our assets to be largely in excess of our iabli-
ties. JAY COOKE q Co"
This statement settled the existing doubt
which still fingered in the minds of many of
the crowd, who, notwithstanding the evidence
which the closed doors of clearinghouse ex-
hibts, still hoped against hope till almost the
very signature of the firm was read.
The expressions upon every side were those
of commiseraton and of sympathy for a firm
that has always so highly maintained its cred
it, and which will raise up from this Temporary
prostration stronger than ever.
Many reporters tried to gain admittance
and but few were fortunate. The reporter of |
the EUening Telegraph was the first to enter
and l followed shortly afterward. The bank
ing room was d&rkened the clerks were scat |
tered through the building, some in groups, |
chatting about the disaster, and others as |
busly engaged at their books as upon ordinary
occasions.
We found Mr.. Cooke in his private Office |
calmly dspatching his orders, and unexcitedly |
conversing about the sudden and unexpected |
blow that had befallen him. He pleasantly |
welcomed whoever called upon him to express |
sympathy and confidence. He said ''You |
can announce that the firm has temporarily |
suspended. Please state also that l believe |
this house will speedily be relieved from en-
barrassment, and that to this end, if needs be.
every dollar of the means possessed by the
members Of the firm will be applied. No one
who has dollar on deposit here will lose it.
Every liability will be faithfully discharged. l
can say no more now.
Mr. Cooke then directed notices of the tenn
porary suspension, as couched above, to be
sent abroad; and stated that this event
closed the doors of three ofices-the three
leading houses Of the firm in Washington.
New York, and this city. Then, with his broth
er members, he commenced an investigation
to ASCERTAIN the exact financial standing of the
firm. The temporary suspension of the Amer
lean house does not i'm any Wav ofTect tba