The morning star and Catholic messenger. [volume] (New Orleans [La.]) 1868-1881, 1877-01-14
ssrnlog Star and Catholic Messenger.
nRw ORLEANS, SUNDAY. JANUARY L. is7.
sszRgFzNANoZAL CRISIS IN GERMANY.
On. Y. SUM-

= @61ring the last Ave years the spectacle of
u re00 vast gambling house. The fervor of
HAeriotism was sac eded by the fever of
SReculation, and the aspirations kindled by
scouquest found employment in the schemes
OF che Stock ExchanEs The dream of sud
den wealth has been dispelled by almost
Hniversal bankruptcy, and they who ex
speeted To ouss France from her place 10
Nhe markets OF the world are now occu
Vsfod In counting their losses and measur
ang their disaster.
After the close OF the war with France,
and after the frat payment upon the
Wrench indemnity, tie false idea obtained
sgoneral currency that the public resources
xsf Germany had been largely augmented.
no tie operators of the Berlin Bourse, the
spring of wealth appeared inexhaustible,
z@ad their transactions undertaken upon
credit were soon extended beyond the
Nsrange that the Government should have
overlooked the danger, knowing as it did
chat the famous French milliards would
Ise to large extent absorbed in the reim-
anraenent OF advances, in the compensa.
stSon due the families of dead soldiers, and
1he construction of new fortresses, in q
word by all sorts of expenditures. useful,
e1o doubt, but not productive. Prudence
would have suggested such a disposal of
Hke indemnity pending it's ultimate appii
soeeion as should have prevented it from
a&codiDg the Stock Exchange, although by
%kis course the State might have been forced
81 - contend itself with smaller returns from
s. dts money. 1t is true that part of the
rgast 1ne levied on the conquered nation
j wes devoted to the purchase of gold in
3oreign countries, and to payments on va
s&tous accounts, but large portion of it
-Was sucked up by the Bourse, under the
EoTm of Investments in funds, advance 3
s&pon scrip, and discounts of commercial
3B2per. From that momeDt the economical
bAlance, already tiuttering, was dislocated,
sN1d the Government, having acted like q
8 banker who snatches at high rates of in
Nareet, incurred it's share of responsibility
a&or the speculative frenzy which followed.
It was uniucky that law enacted a few
s&ays before the war had relieved stock
U0mpanies from preliminary scrutiny and
che necessity of special authorization. The
sarler fruits of this measure, in itself suf-
Rciently judcous, were by no means
4 harmful indeed the first corporations or
4 ganized under the new regime have rem
q 3ered and still render services too ofteo ig
4Ored by the observer Of the German crisis.
Be- was not until 1879, when the banking
gaoem of Berlin had received remarkable
Expansion, that hazardous and dishonest
aeIusects found encouragement. While in
go only forty eight banks, having an ag
gogaee capital of come two hundred mil.
tone of dollars. were quoted on the Stock
Exchange of that city, the number was
npplemented two years afterward by Ok
szmiler Institutions, representing paid. NJ
capital of less than forty millions of dol
41Ts. At the same time the circulation o
AF bank notes unsecured by coin deposits ex
ii sneeded one hundred and eighty millions
Hinder existing circumstances it was no
Al Np0gsible to employ such enormous sum
4 On legitimate solid undertakings, and ac
NJ rc0riipgly these credit establishments len
"a &aofr aid to schemes OF the widest chaT3c
Tho history of the called building so
scSsties best shows the temper of the ZINE
-Scbe money ed men who piunGed into tires
ssnterpTIses started with the notion tina
~ Merlin was destined to be the capital OF tn
world, and must be TecOnstructed in accor
@Szanca with her high dignity. Other cite
STAINED proportonate embeliehment, an
<gE6' might compile q list of more than
4Run6red companies created for this spccl
la2o nurpOse. In Berlin something was ac
eenafIy accomplished streets were opened
ez1lAces and handsome mansions Welt u
eEeu every hand, and tho Thiergarten wa
caseutly encompassed by new quarter
a10aultng with sumptuous residences w
1-stsrl not say that these lavish improvement
aravolxed a notable appreciation in tn
RHlqe of real estate aud an alarming rise
hzsaes, whereby persons of moderate II
snaUsse were RELOCATED to shabby lodging'
ssrsk3 the very poor driven from the CIT.
EsSfxs our petroleum mpaules, however
arFsN majority of these building societies an
5azoustraction banks built nothing but tn
Grt0nes of their promoters. The existent
J. {snE such corporations wa OF course brle
& aegSue measured by the period durin
SEhieh it was deemed expedlent to pay d
sdends ont of capital. On the oth'
lsand, the losses entailed by them wei
Sonormous.- AT the epoch Of the highe
4aUotations the capital stock OF conetrucut
esoznpanies figuring on the Berlin StoC
Srr6ange alone, aggregated three hundre
s-aIIlions of dollars. Most of these ha'
5IEaappeared, and the few which ling
,a1uSt soon perish, loaded as they are WI
zortgages far exceeding the value OF u
Vhich thew nOmln8Ily own.
Ttse history Of the building societies
,us a chapter in the disastrous record
Gfs0se joint stock associations which, du
SEng three years. by tu1ns stimulat al
EB9FaIyzed every department OF lndustr
we cannot recount the many verses ST
tered by a people which appeared to Thu
Sc could enrich itself by working lei
s1Try1duciuR worse, and selling more dear