New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1877-10-08


Corporations, unwilling to break their credit
by confession of weakness tried to conceal
| their condition by false accounts, and III many
cases by lavish expenditures and costly build
ings. TO escape collapse, greater Iisks were
taken. Sober merchants became gamblers. Ex-
perienced bankers staked money upon stocks
of doubtful value. Old insurance men gam
bled in risky mortgages or dangerous roinsur-
ances Men who had managed savings banks
prudenuy, began to stake the trusted funds
of others upon rash Investments. All over the
country, men who were weak tried to escape
exposure: firms and corporations risked not
only all else, but honor also, in a desperate bet
that general prosperity would soon return. Z.
II has not returned. If each individual or
corporation had known hos many others were
in the same predIcament, and how vast a LOAD
of dead DEBT and fictitious valuation the COM
munity as a whole was carrying it would nave
been palpabie that prosperity could not come
until these living lies had been dragged to
light. No people can, by any possibility. pros
per rs long as dead debts, amounting to hum
dreds of mill ms. ar" not only carried from
year to year without reduction. but constantly
increased by an extravaganza of expenditure
designed to keep up the lie. No country can
by any possibility prosper as long as half OF
its property is mortgaged for more than 1t Will
bring at sale, and half of its corporations are
doing business and getting credit on assets
which have no actual value. Inevitably pros
perty was deferred until general settlement
could be forced. Each season, men and cor
poratiOns hoped for revival OF business, and
borrowed more money. Each season they
found the revival mysteriousy deferred, and
| lost more money.
Then came temptation TO crime. The bor-
rowing had been dishonest. and men knew IT..
The exposure would be disgrace. Forgery,
| fraud. oyer-issue OF stock, would be only
another act of dishonesty, and would involve,
if discovered scarcely greater disgrace. But
exposure might thus he prevented until the
| long-expected revival of business should really
come. So reasoning, thousands of men passed
| from gambling to theft To avert confession
of bankruptcy, they began borrowing money
which they had no sure means OF paying. 10
avert exposure of that wrong, they began
gambling with the money of others. To escape
disgrace for that misdeed, they plunged into
crime. How many men, yet deemed honorable
and prosperous, whose ruin, at first only a
misfortune, has been turned into black dis
honor by their own attempts to escape it. will
read these words and know that their own
| experience is related with absolute accuracy 7
Not many, we may well hope. For it is very
certain that no real prosperity can come to
this country as long as its capital is largely
| locked up in dead loans and its industries are
| crushed under the weight of undiscovered
! frauds. One after another savings banks close
their doors, especially in New-England, where
investments in all kinds of stocks are permitted;
in Chicago and st. Louis, where such institu-
tons are permitted by custom to do general
banking business and in tins city where the
! number of such banks suddenly rose from "a
| in 1862 to 15S in 1875. 1t would be public
! blessing if every bank of that nature could be
rigidly examined, and if not wholly sound,
closed at once. One after another, men like
Morton, Gilman and AlliGer are exposed. 1t
would be a public blessing if every per
son engaged in similar transactions could be
| detected and driven from business at once,
| even though the number should prove to be
great, and the losses enormous. For the losses
actually exist already. The-fac that men do
not know their losses. and are still counting as
property that which has long ago been spent,
gamblcd away, or stolen, is the one thing
which, above all others, retards the return OF
confidence and the revival of prosperity.