National opinion. [volume] (Bradford, Vt.) 1865-1874, 1873-12-12
The Currency Question.

The report OF the Controller OF the Currency
has the following with reference To the pane
OF 1878.
the mone,ar crisis OF 1873 may be said to
have had its beginning In New York city on
Sept. &, by the failure OF the Warehouse Secu-
rltv Company and OF two houses which had
lett their regular business to embark IN enter
prises foreign thereto. which were followed on
the l3th ny the failure OF u number OF leading
stock broker firms In New York. The suspcn-
sion OF currency payments ,9llowed, ana was was
afterward extended to other large Cities he,
cause the New York banks could not respond
TO the demands OF their correspondents IN
those cities. aud these III turn could not re-
sDOud to the demands OF their correspondents
The exchange on New York. which would 9th
erwlse have commanded slight premium
was at u discount. and To considerable cX
tent unavailable. The suspension OF the banks
in other leading elites almost without cxccp
tion followed ana their partial or entire sus
pension continued for forty davs, until conf
deucc was III u rnea sure restored by the re
sumption OF the New York city banks on the
first day OF November.
The harvest was nearly oI quite complete.
and the bins ana granaries were fnll 10 over
flowing. The manufacturing and mining
interests had also been prosperous during the
year. ana there was good promise that the fall
trade, which had opened. would he as large as
during previous ars. The value of the cere-
ais, pOta toes. tobacco, and nay, Tor 1872, ~ est
mated hy the Department Of Agriculture at
81 ,32i 1855, 600. An estimate based upon the cen
sus returns OF 1869 gives the ptobabe aggre-
gate value of N marketable products OF industry
that year as A.o36. .0OO, 900. and "A similar esti-
mate upon the same oasis aud upon the returns
to the Agricultural Department gives an lh-
crease OF Il 7Ss 900 900 for 1873 over the amoult
for 1868.
The immediate cause OF the crisis Ia appar-
ent. Tne money market lad become over
loaded with debt, the cost OF railroad construc
non for ftve wears past being estimated to nave
been $,10O.OOO.0OO. or about $34OWO,OU annu
ally, while debt based upon almost every
nf nj. IL
featuring corporations, and mining companies
had been sold IN the market. Such bonds ana
stock had been disposed OF to consldefahle
extent IN foreign markets. and aS long as THIS
continued, the sale Of similar securities was
stimulated, ana additional amounts offered.
When the sales OF such securities could no
longer be effected abroad. the bonds OF rail
roads and otner enterprises OF like nature
which were in process OF construction, were
thus forced upon the home market until their
negotiation became almost impossible. Tue
bankers of the CITY OF New York who were
buriened with the load could not respond TO
the demands Of their creditors. The numerous
holders Of similar securities became alarmed,
and the panic soon extended throughout the
country.
Many measures IF reform are proposed In
order that the LESSONS OF the crisis may not be
lost, and others lie led hereafter to commit
similar errors. UNITY of action among the
leading courts OF the great cities VIII do more
to reform abuses than any Congressional Ell,
actment, for unless suc1 corpofations snais
unite and insist upon legitimate methods OF
conducting business, the laws OF Congress IN
reference thereto VIII be likely soon to become
inoperative, sucn enactments be observed III
their true spirit by the few. while the many
eyade them and thus invite n repetition OF
similar disasters. IT, however, the banks are
dlsinclined to unite for such purpose, the
legislation required OF CONGRESS VIII De sucn
as will induce associations outside OF the CITY
of New York to retain in their vaults such
funds as are not needed at the commercial
centre for purposes of legitimate business.
I'm Cant In N IN
whole amour National Bank currency. le-
gal slender r and fractional currency Is
sued up to ODUu, er 18Th was $563l0,l35 NO
yember LIST the amount had increased to $759,-