New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1876-04-15
deserves attention :

During the In t six months the number OF
failures has been 5.211 and the liabilities
1874, 600, 900. This aggregate was exceeded
during twelve months IN 1897, in 1861, and
in 1873, 1874, and 1875, but not in any
other year. During the three years and one
quarter embraced in the present period of
commercial disaster the number of failures
has been 2l.559 and the liabilities $649,-
Az. 800 The three years 1879 saw only
1900 failures, with liabilities of .S451. $685.
600 the three years 1902 saw only 1918
failures, with liabilities of 1910. 800, and
the three years 1902, though years OF com
paratiyc prosperity, witnessed 1885 failures,
with liabilities of 1921, 100000. Remember
ing that there were comparatively few failures
during the first quarter of 1873, we may
fairly say that within the past three years
the number of killed and wounded in the bat
tie of commerce has been greater than during
the four worst years of all our preceding his
tory.
II ia well understood that these disasters
indicate, not the progress Of a disease, but the
progress of cure The mischief il done
during the years of extravaganza speculation
and unbounded hope. Then it is that vast
debts are created, capital is fooishly risked or
unwisely invested, yasteful expenditure con-
Lsrdmes the resources of the people, and grad
ually rising markets insure immediate gain
but ultimate loss. These periods OF expansion,
whether caused by land speculation as in 1895,
or by railway speculation as in 1856. or by
currency imitation as in 1870, seem to he
times of great prosperity. Increasing hope and
growing prospective profits stimulate excessive
investments and excessive expenditures. An
undue share-pf the capital of the country il
nut into enterprises of venturesOme character.
An excessive number of persons arc drawn
into manufactures, transportation, and trade,
until at length the business of tho country no
longer sulices to support them all, or to yield
interest on the excessive capital thus
invested. Meanwhile, the nations reserve
of capital which should be supplied
each year by the savings of tho mil
lions Of workers, is wasted by habits of
extravaganza and luxury. These seemingly
prosperous times, therefore, make the reaction
and the subsequent collapse inevitable and dis
astrous. In due time it is found that specua-
| tons are Improbable that there are too many
factories, too many railroads. and too many
dealers; and that the reserve capital of the
country is gone. Then comes crash. But
the superiluous dealers will not get out of
business until they are squeezed out. nor the
usperfluous manufacturers and transporters
Nature insures progress by the survival of the
| fttest. Everybody tries to hold on to the end,
and those fail who lack capital, energy, or
prudence. The long and weary years of dis
aster are necessary to reduce the number of
dealers and operators to cut down tho proper
ton of capital invested in the intermediate
pursuits, to compel return to habits of
economy, and to force prices back to a natural
| level.
This remedial work Is not ended. Let us
not deceive ourselves. The average indebted
ness of firms failing proves that the country
has not yet sufficiently reduced the volume of
current commercial Indebtedness. There is no
surer test of general soundness or unsoundness
of business than this. With every period Of
general rottenness, wild speculation, reckless
over confdence, the average of liabilities