Daily globe. [volume] (St. Paul, Minn.) 1878-1884, 1879-10-30
THE WALL STREET BUBBLE.
.Have Tanderbtlt and Gould Compromised
on Erte?--The Banks Alarmed about
Ohecl: Qualifications.
New York Hnecial Telenram Oct OF

Have Vanderbilt and Gould Compounded
on Erte?--The Banks Alarmed about
Ohecz; Certtttcations.
New York Special Telegram, Oct. ~.
Erie stock was very feverish to-day, under
the rumor said to have been traced to an
Erie director, that the Vanderbilt party are
not going into the directory. Definite infor-
nation could not be obtained, but the belief
was general on the street that Gould and
Vanderbilt have to some extent united their in
terests in the trans-contintal scheme. It was
reported that Vanderbilt had offered Gould an
outlet to New York for his inter-oceanio road
over some Of the Vanderbilt roads, and it was
said that In consequence of this arrangement
Ere might not play SO important part as had
been expected. ,...
The main cause, however. of the general re-
action to-day was the report that the banks are
about to reduce their lines of certifcstion of
brokers checks. During the recent excitement
the certifcation of unprotected checks has
made by bank directors Of the accounts
of all their customers. The banks found
that after certifcation the paying teller
had to wait for several hours before securities
or cash were deposited to protect the bank in
its guarantee. In many instances worthless
trash was offered as security, and this some
times had to be taken in. default of something
better. The most conservative banks remon-
strated with their customers, and the
customers resorted to time loans to get
around the difficulty. The risk con-
tlnued to increase, and it has assumed
such alarming proportions that an influential
meeting of the banks which do a stock ex
change business was held to-day to consider it.
A number of proposed remedies were voted
down "a impracticable and the establishment
of q clearing house devoted exclusively to
stocks was favored. 1t was believed that with
such clearing house business could be con-
Quoted on q safe basis, and that less
presidents proposed that q peremptory check
be given to the undue amount of speculation,
and that some decisive action be taken. Presi-
dents Fry, Hays and Happen were appointed a
committee to confer with the governing COM
mittee of the stock exchange. The officers of
house for stocks. One of them said
the plan could never be adopted, the risk being
too great. The present board of officers, he
added, would treat such proposition with ST.
lent contempt. He believed that the remedy
lay with the banks, which ought to
crush out, as far as practicable, all
the small brokers who are encouraging
and three per cent. margins. Mr.. Fry
said that he did not expect that the clearing
house for stocks would be looked on with
favor, but in few days he hoped to propose
some satisfactory remedy. One leading bank
president said that the system of certlfcation
would have to be curtailed. he thought that no
broker, no matter how high his credit stood,
should be allowed to draw check and have it
certified without deposit of 10 per cent. cash
to his individual credit. It is possible that some
restriction of this nature will be imposed on
check speculation, which bankers say was never
so fraught with risk as it has been during the
past two weeks. The open board of trade, hav-
ing secured five hundred members and a fund
of $4,000 met to-day to adopt constitu-
ton and elect officers. George W. Mclean was
chosen president.