Shepherdstown register. [volume] (Shepherdstown, Va. [W. Va.]) 1849-1955, 1878-10-26
ENGLISH OUTLOOK.

Sank, Dy the latest dusiCeS, oeehus W 70
the beginning only of period Of finan-
cial depression, such as England has not
known for lorg term Of years. BY some
of our more intelligent statesmen and
financiers, this result has not been IN
yet to the majority of our
people it has caused considerable surprise.
Coming as it does at time, when the
condition of our own finances is sub
ject of great interest to our people,and
when there are 80 many shades OF
opinion as to the policy to be pursued,
it may not be amiss to enquire into
some of the causes Of this state of affairs
in England. The English system based
upon gold, has been regarded as the
most solid of any, but q careful examlna-
ton will show it to be perhaps the most
unstable. Under the Bank Restriction
Act of 1914, passed by Sir Robert Peel
just after the great panic of 1887, the
Bank of England was compelled to
have 81 in gold, for only fl note
issued over 4l4,OOO,OOO, which was
represented by the obligations of the
English government.
When, therefore, any effiux Of gold
took place, by reason OF an adverse bal
ance of trade, or any other cause, the
Bank was compelled to contract the
currency to the amount OF the With
drawal of gold from the vaults, and, at
the same time, raise the rate OF discount
to prevent any further efhux. AS the
notes only represent small proportion
of the medium Of exchange, the larger
portion by far being in drafts, bills Of
exchange, notes and transfers OF ac'
count, the moment any contraction,
however small, occurred in the currency
of the Bank, the contraction of the lar
ger amount would not only be in pro-
portion, but be largely augmented by
the distrust and fears of capitalists who
tried 20 protect themselves. Compar.
ing the currency to fan, the pivot of
which is the gold, and the diverging
radii the currency and the credit based
upon it, it will at once be seen that the
slightest contraction at the pivot is
many times augmented by the circum-
ference. r'
England has, for many years, not only
made no diminution i'll her debt, but
has frequently found difficulty in paying
the interest thereon, and at the same
time meet the ordinary expenses Ct the
government.
IN all her manufactures, save iron,
she las not even upon her own soil
produced the raw material, much less
the food used by her operatives in the
process of conversion OF the raw mate
rial into manufactured articles. She,
stands in the position of re-
curing not only the entire world 10
send her raw material for conversion,
but also to send her food with which to
convert it, and pay the transportation
charges each way. AS each nation by
its own development Of manufactures
separates itself from this state OF contri-
button, it not only ceases to be Gus
toner of England, but proves ccmpet-
itor in her market, inflicting two-told
damage. Already the United States
has invaded the great cotton manutac-
tory, Birmingham, her great iron and
cutlery centre, Sheffield, and American
goods are driving out by their superior
excellence the British articles in their
own stronghold. American cheese is
Stillon and Cheshire; Amer
lean cars are running on English roads;
American watches are driving the best
English and Swiss makers out OF their
home markets, and American coal is
now rapidly being introduced OIL the
to the detriment of English
miners. Not only Is this the case on
he continent, but in the English colo
nies, and the balance of trade has been
so steadily and so largely in our favor
Tor the last few years, that our bonds
have been returned in payment for our
exports, and the interest has been lost
to England.
Soon the gold must begin to flow to
this country to pay the adverse balance
Of trade, which will further augment
the difficulties under which they labor.
The lower classes are in great state
Of wretchedness, while thecomplications
in Afghanistan threaten another source
Of expense, which must be met.
From these facts, we can readily sec,
hat the gloom expressed in financial
circles has no bright outlook in the near
future, and the news to-day of new fail
nres, the increase in the rate of dis
count, together with the gloomy tone
Of the articles in the London Times,
are indicative of a much wider COM
mercial distress, from which there
seems little hope Of escape.