The Richmond palladium. [volume] (Richmond, Ind.) 1855-1875, 1875-09-08

uo SGIluScuCy WHICH u4O OCCuI
red in the fall of 1871 and 1872
was significant of the approaching
absorption by expanding credit of
the legally limited amount of paper
currency. In the summer of 1873
the Granger agitation at the West
frightened investors from railroad
bonds, and crippled the enterprises
which depended on the continuance
of these Investments for funds. The
rebuilding of Chicago and Boston
had also caused great absorption
of circulating capital. September 8
the New York Warehouse and Sc
curity Company failed, followed by
one or two more firms involved in
railroad coAstruction Confidence
in persons known to be burdened
in this way was impaired, and a
run on them for deposits began.
September Is Jay Cooke & Co,
succumbed to this demand, and a
panic followed. The country de-
positors began to run on their
banks, though without panic. The
country banks called for their ball
ances, and the city banks called
their funds in from brokers. On
the Goth the Union Trust Company
suspended, followed by two or
three other banks and trust COM
panies. The panic on the Ex-
change was so great that the Ex-
change was closed, and remained
closed ten days. The Gold Ex-
change closed on Monday the 22d,
gold at 112. On the goth the AS
sociated Banks formed an alliance
by which seven per cent. certificates
were issued for seventy five per
cent of the value of securities de
posted by any bank, which certif
Gates were good for Clearing house
balances; S22,OOO,OO0 of them
were issued before the tide turned.
The President and Secretary were
In New York on the Dist, but re-
fused to draw on the S44,OOO,OOO.
The Secretary ordered bonds to be
bought as measure of relief, and
$12,OOO,OOO were bought. This
depleted the cash on hand, and be.
fore January 1 he was obliged to
issue over S26, 100000 of the $44,-
100000 for current expenses. This
carried the greenbacks up to $780,:
900. The suspension of paper pay
ments by the banks lasted until
November %. Meanwhile the cri
sis was affecting industry in all
forms 1t produced general
doubt of the status and of the fu-
ture. Hours of labor and wages
reduced and workmen discharged
The lack of reviving courage and
enterprise has been very marked,
and is due to nothing less than the
general feeling that there can be
no permanent cure until the finan
cial problem is solved The fail
ures in 1878 were 5,1S3, liabilities,
1928, 110.0O0; those in 1874, $3.50,
liabilities, sS155, 100000 The act
of January IA, 1875, specified Jan
uary 1, 1879, as tie day for re.
Stunning specie payments.
The people Of a new country are
not likely to be very careful finan
ciers. They have no traditions to
carry down the warning of the past.
They are not trained to look back
or to look forward. They do not
look back, because the great
achievements of yesterday only pro
woke a smile to- day. They do not
look forward, because they trust
their power to deal with whatever
may come. We must not expect
what is inconsistent with the con-
ditions. If we look to the past,
there has been great progress. The
theories on which the colonists
based their paper "banks' obtain
attention from no sober men to
day. The banks wha ever their
faults, are not like those of 1916,
nor yet like those of 1886. On the
other hand, we are still struggling
with the problems of currency and
taxation and debt A student of
our past history can hardly expect
that these will be solved by heroic
effort, but by long and painful
growth up to the conviction that
financial makeshifts do not pay,
and that the first condition of deal
ing successfully with financial diff
Guilty is to get free exercise of the
national productive powers.-Har-
pers Magazine.
Chicago Parks.
Chicago has under preparation