New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1875-07-28
with our affairs will be at our late banking house,
No. IL Nassau-st. DUNCAN, SHERMAN d Co.


MERCANTILE sPECULATIoNs AND ADVANCES TO RAIL
ROADS REPORTED AS THE CAUSE OF THE FAIL
URE-THE BOSTON AND MONTREAL AND MOBILE
AND ONO ROADS SAID TO RE LARGE DEBTORS
Various rumors were put in circulation very soon
after the news was made public regarding the cause
of the failure assigning heavy speculations in
cotton and grain rs the cause, while Others attrib-
uted it largely to speculatiOns in Improbable rail-
way securites. The firm has long been acting as the
New-YOrk fiscal agents of the Mobile and Ohio Rail-
road. More than year ago, it was stated, the firm
heavily involved account of its transactions
with this road, which, however it was supposed were
settled recently the coupons of the road to the
amount of about 100000 fell due and the road was
unable 10 meet the payment. Duncan, Sherman q
Co. bought up the coupons, and it is not known that
any part Of this 800, 0o0 has since been paid
The report that heavy speculatiOns in cotton
brought about the suspension was generally dis
credited at the Cotton Exchange. 1t claimed
by prominent member that the decline in the price
of cotton daring the past six mOnths-at most three
ccnts-was not sufficient to produce such disastrous
results.
Mr.. Power the Superintendent of the Exchange.
stated that under the present management. 1t is
altogether impossible TO trace the transactions of
firm. Duncan Sherman Il Co. undoubtedly had
bought largely during the past year, but whether on
account of orders from England or on their own ac-
count not known. he price of cotton declined
at the Cotton Exchange about Il of a cent per pound
before the of the failure was received. The
announcement of the suspension was followed by
further decline of Il of cent, with an unsettled
feeling among dealers but failures reported.
1t was supposed the firm held large amount Of
Alabama State bonds, but John d. Manning, at No.
7s Broadway, stated to a reporter OF THE TIIBUNE
that settlement was made with the firm on account
of these bonds before the present Governor OF
Alabama was elected. and that the State cOnse-
0uently owed the firm nothing There were run Ors
of heavy loans made in Erie stock as collateral, the
stock being taken at a valuation OF about 30 while
it now stands at II. Other pointed to some
what similar complications with the interests of the
Atlantic and Great Western. The persistent silence
Of the firm left business men generally in state OF
suspense, and until this uncertainty is cleared up
the effect on the prices of securities cannot be fully
estimated.
There was very general expression Of n suspicion
on the street that the firm had been involved for
some time past and it was stated that their paper
had recently been selling at a figure considerably
below that paid for prime discounts leading
Wall-st banker thought the cause of their disaster
could not he assigned TO any one class of invest
ments. There has been he said no great depression
in the market of any kind of goods in which the finn
had probably invested. He was rather disposed TO
attribute the failure to a want of funds, which the
firm has abOred under for months past.
Another prominent banker, in brief interview
yesterday afternoon, said that there had been much
dstrst for several months to the financial c0ndi-
ton of Duncan, Sherman IL Co. RumOrs had been
current on the street that members of the firm were
largely interested in mercantile transactions outside
of their banking business, which bad locked up
their capital and had not proved successful. II was
believed by many that large advances had been
made by certain relatives of a member or members
af the firm to protect the Credit of the house, until
was no longer possible TO save it. There could be
no doubt of the ability and willingness Of
the friends of the finn to help the part
ners out of their trouble, TO any reasonable
amount. hut the suspension showed that they had
become too deeply involved, and not in
condition TO avail themselves of protered aid. Ii
was a mistake, said this gentleman. for bankers to
engage in Outside business speculatiOns The record
showed disastrous result In almost every instance
where such speculatiOns had been entered into.
Bankers safe only when they kept their affairs
well in hand, and avoided all temptation TO engage
in specuations ard transactions not in their line Of
business.
large number of English merchants doing
business in this county,, i'll the habit of keep
ing their private bank accounts with Duncan, Sher
man & Co., but several of them closed their ac-
counts several months ago, when it became known
that the firm was dealing in cotton. Their bills on
the Union Bank Of London were not so much in de-
mand as formerly by importers who preferred them
last year to other bills. Yesterday was the day when
importers buy their exchanges Ionittances for
Europe by Wednesdays steamer, ard considerable
countermanding Ut orders given on Monday to ex-
change brokers was made, while extraordinary care
was taken to the names Of bankers whose
paper was offered for sale on the market. The
bills on the Rothschitds drawn by Belmont e. Co.,
were in greater demand thar usual but in many liz
stances advices by cable sent that no cx
change would be purchased at al several importers
prefeTIing to await developments until the next
steamer day.
Among those protesting to he we'll Informed in
gard to the operations of the fm it is stated that
in the assets will be found obligations of the bank
rupt Ncw-YoIk, Boston and Montreal Railway Com
panv, which at one time received large sums ad-
vances from Duncap. Sherman d Co.
At the Fifth Avenue Hotel last evening the failure
was discussed snong the small groups in the CORR
doris and at the main entrance The fact that so
many who are interested in the event are absent at
Summer resorts, or 20 out Of town at the close of
business each day, prevented a large gathering.
Some surprise was manifested that no failures have
as yet followed the fall of prominent a
banking house which has heavy liabilities. 1t
was conceded that several firms must have
been badly crippled. and many persons
expressed tie belief that within day or two there
would be failures of bouses whose available assets
were deposited with Duncan. Sherman d Co. Tho
action of the firm in going outside Of its legitimate
business to deed III cotton and other articles was
condemned ana the attempt 10 prop up Che credit al
Southern railroads also criticised as unwse and
inviting disaster.