Sacramento daily record-union. [volume] (Sacramento [Calif.]) 1875-1891, 1881-08-13
CALIFORNIA.
PAST, PRESENT, FUTURE.
Her Financial, Agricultural, In
dustrial, Mining, Mercantile
and Other Interests.
HER DECLINE, RECOVERY AND OUTLOOK
The Condition of Capital in Califor-
MIA The New Constitution
Railroads and Development,
HER DECLINE, RECOVERY AND OUTLOOK
THR ERA OF PROSPERITY HERE.
Address of Lloyd Tevis, President of wells.
Fargo g. Co, Before the American
Bankers Convention at Niagara
Falls, N. Y, Aug. 10, 1881.

of this Association without recognizing the
value, both practical and theoretical of many
of the papers which they embody. SO fully
realize our obligations to the gentlemen who
have thus favored US, and am so fully con-
scious of the mutual advantages to be derived
from bringing together, as into common
fund, such information as each in his sphere
has been able to gain, that 1 am ready when
called upon, as think we all should be. to
do what may in the same direction. But
the subject upon which have been invited
to address you-the growth, past and pros
pective, of the industrial and banking system
of California-is subject 80 large and so
interesting to one who has long participated
in the active business life of the Pacific coast,
that he may well despair in an ad-
dress like this of being able to treat it as
it deserves. l do not mean merely that any.
thing like history of the industrial and
financial growth of California would be a
work requiring much time and labor. Such
ahistory, of course, hardly comes within the
purview of this association. This is not an
historical society, nor statistical society.
1t is an association of bankers, whose annual
meeting has assumed something of the char
acter of clearing house Of experiences and
opinions relating to the financial interests of
the country. And SO thoroughly and well
have many of the papers read here presented
the matters to which they have been devoted,
that in attempting to treat subject that has
so many striking aspects as that assigned to
me, one cannot but regret the difficulty Of
uniting completeness with brevity. The fact
that
THE CONDITIONS OF CALIFORNIA
Have been in many respects different from
those of the rest of the country, and such as
to sometimes bring important general princi-
nk -olaa 10 ba oil
of her experience a very interesting one.
But all can hope to do In paper like this
is to supplement what has been SO ably done
at previous meetings by Mr.. Gibson in rem
dering some account of the industrial and
financial condition of California, and, per-
haps, removing some misspprehensions cur
rent in other parts of the country.
In treating of the industrial and financial
system of California, it is necessary to extend
the view beyond the geographical limits of
the State, for the circles of business do not
coincide with political divisions, and that of
California reaches far beyond the boundary
lines of the State. California has been the
base and starting point of American develop
ment upon the Pacific Into Oregon and
Washington and British Columbia and
Alaska into Nevada and Utah and Idaho
and Montana into Arizona and New Mex
leo and the northern States of old Mexico !;
over all that part of the continent lying west
of the Rocky Mountains, California prospect
ors and miners, settlers and traders
have carried the industrial outposts of
that community which sprang into being
with the California gold discoveries Of 1849.
San Francisco is not merely the metropolis
of the State of California, it is also the
metropolis of the greater part of this vast
region. How far extends the commercial and
financial system which centers in San Fran
cisco, the operations of the express and bank
an idea. Wells, Fargo & Company is pecu-
liarly California institution. Beginning its
operations in the early days of American set
Element by affording the needed facilities Of
safe transportation between San Francisco
and the mining camps of the western slope OF
the Sierra Nevada, it became the forwarder,
the letter carrier and to large degree the
banker, of an extending population. As the
pr0spectors and pioneers advanced, it followed
them, until its agencies, now numbering over
seven hundred, form network which
stretches from the Mexican boundary lire to
that of British Columbia, and from the Pa
citic to the Rocky Mountains, with outposts
upon the Missouri river and the Gulf of
Mexico. Wherever the organization Of
Wells, Fargo & Company reaches, the COM
mercial and financial influences of San Fran
cisco extend, though since the business attrac-
tions of the Eastern cities have, with the ex-
tension of railroads, begun TO make them
selves felt in the further west, it is impossible
to describe as accurately as before the bounds
of the California system.
In California itself, and especially in San
Francisco, we have had, in fact are yet suf-
fering from,
AN ERA OF DEPRESSION,
Which followed an era of great prosperity.
This season of depression commenced some
what later and has continued somewhat
longer than that which so long weighed upon
the energies of the rest of the country !; and
it is now passing away, very much as that
passed away. 1t might seem from this
difference in time that the depression in
California was due to something like great
wave Of depression which passed slowly over
the country in its worldwide movement
But whatever be the effects of that increasing
sympathy which, with increasing facilities of
communication, links together the commercial
fortunes of even the most widely separated
communities, there are peculiar local causes
to which the depression in California is in
great measure to be referred. And while
these causes may fall into the game general
category, they differ in some respects from
those to which the great depression that over.
attributed.
CALIFORNIA HAS ALWAYS EscHEwED PAPER
MONEY,
Banks OF issue being prohibited by her Con-
stitution from the beginning, and even when
the National currency was adopted and made
legal tender by Federal law, the feeling
against paper money of any kind was strong
enough to maintain the gold standard all
through the war and through the era of in
hation which followed if. California, con-
sequently, did not feel the seeming prosperity
attendant upon the great rise in nominal
values which took place in the East as the
currency appreciated, and she also escaped
the inevitable reaction which came with the
appreciation of the currency and the fall Of
prices.
Yet it is most instructive fact, that in
spite of her adherence to the coin standard I;
in spite of her exemption from those terrible
fluctuations in the medium of account and
exchange that unsettle all values and derange
all business, California has not been exempt
from the alienation of seasons Of depression
with seasons of prosperity. / do not think
this shows that it makes no difference whether
a currency is sound or unsound do not
think this gives any comfort to the advocates
of fat money, or invalidates what has been
so strongly and aptly said in previous meet
losses inseparable from an inconvertible cur
rency. Yet it does show that sil is not Sc
cured when good currency is secured and
that even with the best and safest currency
seasons of unreasonable inf alton may occur,
which are sure to find their sequence in sea-
sons of depression.
THIS Is A LESSON
Which at the present time may have especial
value. The long, hard effort for the resunp.
ton of specie payments has at last been
crowned with success, and with che exception
of the Pacific States. which never deviated
from coin standard, the country enjoys a
better currency than ever before-a currency
which, if not yet entirely pu-ged Of all dan
gerous elements, is still convertible into gold,
and is in domestic exchanges generally pre-
ferred to gold. And with the restoration of
the currency to specie standard has come
q revival of activity in all branches of bust
ness. Yet, il there were nothing else to teach
us, the experience of California would show
that, even with good currency, a season of
great prosperity, If suffered to beget specula-
ton, may produce an inhation which, when
succeeded by = season OF depression. And it
may also show how reckless political agita-
ton, TO which in times OF depression cur peo-
pie are prone to listen, may make more diff
cult the process of recovery.
However this may be, the causes which in
California have led 10 the alienation of de-
preston with prosperity may be traced with
comparative ease.
In the life of community, as in the life
of thsipdiFidlal, one era passes into another