The St. Cloud journal. [volume] (St. Cloud, Minn.) 1866-1876, 1875-07-08
THE RECOVERY EROM THE PANIC.

THE RECOVERY ERoM THE PANIC.
From the Chicago Tribune.
Ever since September, 1873, there
has been settlement going on of the
outstanding indebtedness. There has
been a general striking Of balances.
All debts contracted on bogus securi-
ties have been of course sponged out.
The banks and bankers who had in
vested their own and other peoples
money in speculative notes, secured
by speculative bonds, have ceased to
do business, and have distributed their
assets among their creditors. The
National Banks of the United States
at the time of the panic held $780,
100000 of discounted paper; other
banks in the United States held pos
sibly $700,009,000 more. The ma
jority Of this paper went to protest.
Outside of this there was many hun
dreds Of millions Of dollars of debts
secured, or supposed to be secured, by
mortgages. The banks themselves
owed their depositors over thousand
millions Of dollars. Payment of all
this indebtedness was for time sus-
pended. A large portion Of it was
blotted out from the beginning, and
the country has ever since been en-
gagged in settling up these balances.
This has been done largely by the
offset Of claims. Thus one mortgage
| for real estate has been assigned to
| the debtor in another mortgage, who
has redeemed his own property by
passing the first one on to his credi-
tor, who in turn has exchanged it for
other incumbered land. There being
no purchasers for real estate, debtors
and creditors under mortgage deeds
have gone on adjusting, and exchang-
ing, and settling differences until a
large amount Of land has been releas-
ed from mortgage and the liens salts
fed and discharged. In the same
way banks have been settling with
their debtors. Gradually but regu-
larly the volume Of unpaid paper has
been reduced under extensions and
partial payements, and by settlements
at various rates on the dollar. So
have the wholesale houses been set
thing with their customers the retail
ers, who in turn have wound up and
settled with their debtors. In every
case the volume of Indebtedness has
been reduced. The mushroom com.
panies that had sprung into existence
and were doing business upon nc
other capital than their credit, Of
course went down to rise no more
The companies that, in the excitement
of speculation, had manufactured
stocks of merchandise far beyond any
demand, have been gradually selling
off their surplus stocks and paying
their debts. The iron and coal men
have in like manner reduced their
outlays, have collected all they could
and have paid off their own debts and
contracted no new liabilities.
| The results of all this has been
that, now in 1875, the amount Of in
debtedness Of all kinds, especially in
the shape of mercantile and manufac-
turing paper. is lower than it has been
for many years. There has been g
vigorous retrenchment of expendi
lures there has been a large reduc
ton of production, and consequent
unemployment of labor; but this i:
largely due to the peculiar character
of our currency and the stringent
prohibitions of the tariff, which limit
our markets to our own territory
But in the great item Of freedom from
debt the country was never so fortu
nate. The season following the panic
has been season of settlement, of pay
ment, of redemption, and of re-estab
lishment upon substantial basis.