New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1874-10-02
THE ADDRESS.

THE ADDRESS.
Mr. PRESIDENT AND GENTLEMEN: thanK
Won very warmly for the honor you have done me In
asking me speak 10 you, and extremely regre, 'ha'
was not that should be asked to discourse Oh
this subject to-day Had known beforehand should
have written lecture which would have presehleu
the question better than now But snail feel
great pleasure touching upon the main points ana IL
nv doctrines in any respect challenged IL VIII De
only great delight to that the dificui'les urgeo
against it should be stated. The question tnen IL
Crises" What crises Great disturbances OF tne
money market, difficulty Of obtaining ADVANCES nisn
rates OF discount great firms in danger VINO 10 sounu u
who ia unsound unknown whose money Is safe' "hose
is unsafe matter OF great uncertainty just as was
IN England in 1866, 1t is time when those VINO arc
the strongest are exposed 10 the most rorhndapie
dangers. There probably institution IN LONDON
more exposed TO peril in 1896 then the great London ana
Westminster Bank the largest in England ana one oi
the ablest conducted. The cause OF the crisis was
simply alarm simply that those vast bodies Oh Peop'c
who had ntrusted funds this institution got INTO
what may be called a panic, TO use common "oru
In that state of wild alarm, all rushed ior lnelr
money every many catching the eoutagion which
became more catching because it was unreasonable
There s nothing more stirring than alarm winch mas
no definite cause. which does not know what IL Fo's
upon. which, therefore, suspects any cause Vi
becau sc IL that IL put Its nn2er upoh We
know the agonies of that time. we Kno" 'n"t inc
greatest firms especially old banking niihs' "ere III III
finite alarm. We know that the extent 10 which tue
evil might rage was absolutely uncertain. Ana we
know and have seen England that the fathers OF the
CITY, the great bankers and wise men, sat In council all
night and asked each other "What IL the curei
But a panic Is not easily cured Dy Sitting up
all night Some would say from their recurrence tnat
they come under some physical law; are perlodic
visitation like a comet with decennial period ten
year hurricane il gwen by some as law OF tue ohey
market You aye bound to be ruined every ten years.
You are not conscious have done any wronS'
but II is simply great typhOon raging upon great
number Of agitated minds Is this sol Is IL law OF
business that amounts to phys ia"' Al IL IL IL
certainly is extraordinary phenomenon ana one
which requires very much bigger proof than the recu-
renee OF panlcs There would be very unpleasant result
for If 1t Is law inherent in business there Ism" remedy
We cannot cure typhoons and equinoctlal gales IL
they are the the money market you must reduce
your sails, stand by your helm, and you may possibly
get of with the loss OF mast or two But OF all that
believe nothing. believe the cause OF these panlcs
can be stated and when know the danger ana the
cause likely disturb you can take proper precautions
Now it is not the magnitude OF the loss alone which
constitutes crisis.
DESTRUCTION ALONE NOT THE CAUSE.
bad harvest in England is loss of 93O,CO00CO; that
f. have got to,buy procure sSoooO-
600 worth Of corn twice You have sown you have
titled you have put the manure on the land, but the
August rain the corn Is not matured and you
have got 20 hive, you must buy it from the stranger
But that produces no panic no financial agony
in the money market. But IL does not generate man
cia Then bad war war Is the most desTuc,
to destroy; they destroy food, clothing, iron,
ships Nothing DESTROYS like war: P rs Inc
war does necessarily produce panic III is ths ter
rifyng fear which We know accompanies nurrGane
7 well "a
England. IL terrific loss OF money. Wealth IN
those districts was paray yea BECAUSE aerca va, ~
paraius OF capital earning nothing consuming
Pnv,nr hut NOT selling But there was no panic That
DuS nor snnmerated as one Of storm therefore
don't get, by destruction alone, INTO feIgn Oh
panic Then asan another ',as wafer irT,c
ally in particular spot, but the helshOorns "ae,
are dead calm, AZ rne t nnnrges were ar a.
when people could not get advances on the best secur
ties when the bank had 10 say, can't, al tns une
the market for advancing money on agriculture, 10
s0ures and country gentlemen was 80 That they eOui
get all they wanted at per cent. That is absolutely
very pecuiar about The real fury OF the storm
In its national Importance In distinction to indvauais
a. s hco ring upon banks, upon discounts IL is not 20
much on per cent, though that - bad enough Dul
Is the possibility Of discount which coustitu,gs .e
terrific agitation and the loss TO the nation MODERN
trade as YOU are well aware, - carried on upon
a very peculiar method nave no DOUBT IL b Is ~ y,
IL carried on other peoples capital nor the traders
The traders not the people who provide Tue capital
for their business Some they 90 proVlde thc Oulh GER
ainly not The distinctive peculiarly OF modern raue
Is tna II Is carried Dy bills, and Dnis have 10 De ds
but will pay this three months" The goods are
given the sale is completed. and the man VINO sells
holds in his hand piece OF paper which says tlal after
three months he VIII have his money, put not before
The man SO clrcumstanced wants to go on WIN MS
business which he cannot do If he has 10 wait three
months for funds 10 come In How are his WorAng
men 10 paid his ship 10 be sent away Ihat 10
dane by discosntlng bills BANKS ana the natlOuaI
strain OF the crisis IL Its action upon the general rae
of the by acting upon the discount market I
discouuting takes Mace banks, aud, therefore, we
now see locality q the storm 1t is somehow or other
connected with banks1
WHAT rs A BANK !
Ranks are peculiar institutions. know great many
OF the eminent bankers OF England well have asked
directors OF banks the Governor Of the Bank OF En-
GLAND and personages of that kind very simple ques-
top: but I never met only one man. dead
and gone now, who could answer me TINS gus gus
That lies at OF the question OF crises nave
only met one Mr.. Potter the founder or the great Lon
don Joint stock Company. who could answer that qne
ton. know what a grocer IL. He deals IN candies; N
tea in sago. know what fruiter Is: II ask snch
man hat he deals has not the slightest diincuiy
In answering my question. Now. will any gentleman 10
this favor me with replyt "A PAUSE Iar
anvhody tell me Some of you probably Dankers
Do you think troublesome fellow TO ASK YOU
such questionsi GLaughterl You draw cheeks anu
LIONS in TINS nneteenth century that great
profession such great branch Of human ACTIVITY ,
Is no definition, except perhaps In my writings OF WHAT
bank IL and what 1t deals In But II is essehal. ~
order understand crises TO rstand Eht ie
are, as they are phenomena OF pahAins' LUCY NV 49,
Chinese Sea OF banking ,rx
Now the gentlemen will probably say that banker
deals in money. say, No. deny that nat paDher
Is not dealer In money 1T Is not an anair OF moue5
dare say many gentlemen VIII hre al NE now. ~ o.
for shot II ali fair. Another pause, waiting ior
reply.l WE'LL gentlemen, you don't seem rea 4 ~.
fight. Well Will go then. L said IN fTd@1
wear ago that banker did not deal In money above one
thriieih Of his business or order TO 20 on
10 that putation must understand what money Is
There IL another ugly question. . ..
What is money! gave lecture before tbe Chamoel
of Commerce Of Liverpool on that question VIII I'm.
passing take the word money. II comes from the Ien
tAe money was stamped pieces OF metal generally
known by the name OF coin. Nothing Is money but tnal