Nashville union and American. [volume] (Nashville, Tenn.) 1868-1875, 1875-06-22
THE ENGLISH FAILURES.

4
into the millions. The first firms to
succumb, namely, the Abendare Com
pany and the Plymouth Iron Works,
caused but little surprise, although
their loss was five millions, because it
was readily attributed to the depres.
sion in the iron trade, which is fully
understood in this country, owing to
the general cessation of railroad build
ing caused by our panic of two years
ago. Unlike other products, it is hard
to determine when iron is ultimately
consumed. Every old rail can be re-
rolled, every old horseshoe con
tributes toward making new
one, and, in fact, every scrap
Of old or waste iron can be
reworked to advantage. This durabih-
ty shows now easily iron furnaces can
be multiplied during period of rail-
road building, demanding an extraor-
binary supply of new iron, and it also
shows how, after that era is past, the
same amount of production may prove
excessive, oyerstocking the markets Of
The world. Such seems to be the pres
ent condition Of the trade Therefore,
when failures to the extent of $751;
100000 followed that of Abendare, it
occasioned little surprise IN American
financial circles, and the London bank
ing firm of Sanderson & Co., who
failed for S35, OOO,O were regarded as
bearing the same relation to the over
done iron trade of England that Jay
Cooke & Co. bore to the railroad bust
ness in this country.
But the millionaire failures continue,
and other branches Of English trade
begin to be affected. Already the ag-
grcgate failures announced by cable
exceed S83,O0O,OOO and as there must
be many minor suspensions Of which
the cable makes no note, the total
doubtless rises some distance above
round hundred millions. Most promi-
nent among this second series of fail
ures is a London banking house that
60 s under with So, 800, 900 liabilities,
and a cotton commission house of Nan
chester, Alex. Collie & Co., who tum-
bic with SIS. OO0,OOO This latter item
is well calculated to arrest attention
among our Southern readers interested
in the staple. 1t is attributed however,
to a falling off in the East
India trade, which has been in an IN
satisfactory condition for some years,
particularly since the great panic. The
economy forced on the people of France
by war and on our own people by a
grotesquely needless panic has doubt
less contributed its share toward de-
creased consumption and the accumu-
lation of manufactured goods, which
inevitably leads to a break in prices.
The large strikes Of late years, to which
mill-owners have yielded, giving more
wages than they could afford and run
ming the mills at a loss IN the blind
hope of some fortunate turn in affairs,
is cited by some as among the causes
of present depression.
Thus tar all the failures announced
are confined to the two departments we
have mentioned, the iron interest and
the East India trade. Whether
they Will extend further and occasion
a general panic, is question on which
our ablesJ financial exchanges are d.
vided; but the weight of opinion seems
to be that in any case this country will
not be affected to any material extent
As a general proposition, this is doubt
less true; yet it must be admitted that
a surplus of iron in England seeking
the markets Of the world must retard
the recovery of that interest here. In
the same way, falling of in the In
dian demand for cotton goods must de-
crease the demand for our raw material
pro tanto. The effect may lie very
much diluted and hardly appreciable
in amount when 1t reaches US, like the
widening ripples from a central splash,
but we can hardly escape entirely the
workings Of the law Of equiibri um.
Some fear that these London fail
ures, beginning in the weakest parts of
trade, and Immediately swapping the
large banking houses interested in
them, may be the prelude to a general
panic in London. 1t is argued, with
some plausibili.y, that the plethora of
accumulated wealth which England en-
Joys is a source Of real weakness. The
more plentiful money is, the less scru-
tiny is devoted toithc securities offered
in exchange. The millionaire does not
like to keep his money idle; he wants
70 pace II EOmCMutICs II uC Cdu AOb
get six per cent interest, he will take !
three; if he can not secure frst-class
collaterals, he viii accept second or
third class In this way Eng |
fish capital has been scatter
ed over the face Of the |
earth in aid Of multitudinous en-
terprises of doubtful outcome. Eng
land thus becomes liable to losses from
or false fnanciering |
in any and every other country. The
principal danger, however, lies in the |
of this excess of capital to
the multiplying of proftless projects at
home. The American panic, for in
stance, caused hundreds of millions of
capital TO be withdrawn from
our railroad and State and National
securities. These millions naturally
sought home investment, IN preference
to fresh foreign ventures, and 1t is
broadly stated that the large Abendars
and Plymouth Iron works have really