Iowa voter. [volume] (Knoxville, Iowa) 1867-1874, 1873-10-02

Great excitement prevailed In all inc
commercial centers of the country upon
the announcement of the failure of Jay
Cooke 81 Co., bankers, of New York, Phil
adelpha and Washington, Financial
Agents of the Northern Pacific Railway,
issuers of foreign letters OF credit, etc,
etc, etc. A tremendous panic ensued in
Wall street, and stocks fell from one to
ten per cent.
Prudent business men have predicted
for years thatJa Cooke & Co. would fail
Their enterprises were so daring, their
scrupuousness so doubtful, their liabli-
ties so large, their exterior so glittering,
that among the really heavy men of the
country there has long been belief that
sooner or later the firm would go to ever
lasting smash. Nevertheless, their actual
suspension when announced was n sur
prise. They had stood so long under the
Northern Pacific load that even those who
predicted their failure fancied that they
would somehow pull through. When
their collapse was announced, there were
probably thousands of business men in all
parts of the United States and Canada
who exclaimed, simultaneously, III told
you So"
That the failure is bad one is very evil
dent, and the question of the moment is
| how far other establishments may be in
volved in the ruin, and how far il will
affect the general business of the country.
This can only be answered by the expert
ence of the next few days. 1t is not prob
able that many of the National Banks had
balances with Cooke The firm has been
looked upon with suspicion ever since it
embarked in the Northern Pacific venture,
and hence did not secure large line OF
country balances.
In the absence of specific information
as to the cause of this failure, the country
will naturally attribute it to the attempt
by this house TO build the Northern Pacific
Railroad through wilderness, and to pay
interest on rapidly-increasing bonded
| debt without any income from the road.
Whatever may have been the original
| expectations Of Jay Cooke con-
corning the Northern Pacific, he
has failed to obtain any subsidy
from the Government other than
the land. grant, or any help from Europe,
except perhaps in the way of loans on the
hyp0thecation of bonds. The sales OF
land have been the only source Of revenue
with which to meet the interest, and it is
| probable that the firm has been attempt
| ing to carry the unsold bonds, and TO keep
| them at par, in order to 90 on with the
building Of the road.
The firm of Jay Cooke s. Co. originated
in Columbus, Ohio. 1t received its con-
sequence in the early years of the War AZ
agent of the Government under Secretary
Chase for the sale of public securities.
| Under Secretaries McCulloch and Bout
| we'll, this confidence was continued. Mr.
McCulloch, after his retirement from
office, became q member of the London
branch of the house under the name Of
Jay Cooke, McCulloch & Co. Under the
present Administration, 1t has continued
to enjoy all the advantages of its con-
nection with the Government To it was
committed the first, and subsequently the
second, Syndicate, by which large profits
were given for exchanging six per cent.
bonds into five per cents That the frm
has enjoyed large credit, because Of its
actual and supposed connection with the
Treasury Department, Is unqucstionable.
1t is strongly suspected that THIS
credit was abused in the sale of "7-3O
bonds" of the Northern Pacific Railway.
We do not apprehend that this failure
will lead to anything like a financial
crisis, or cause any serious disturbance in
the business Of the country. There will
be clatter Of small failures caused i'm
mediately by this one, and q smashing Of
crockery In Wall street produced by the
decline in stocks. But the volume Of pri-
vate Indebtedness throughout the country
at the present time is not large. The
stringency Of last autumn and winter led
to a vast curtailmcnt of liabilities. PeO-
pie have since then set their houses in
order. There is nothing to make gem
eral panic out of.-Chicago Tribune, Sep
tender 10.