New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1883-08-10
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1HE FEAR OF A PANIC.

Since June 1 commercial failures have been
unusually numerous and large. The lard fail
ure at CHICAGO, the failures at Cleveland, Chi
cago and Pittsburg, in the iron business, some
heavy dry goods failures here, and the collapse
of L. Shaw g. Brothers and of other leather
manufacturers ana dealers have made
gloomy record for the past two months. Some
persons begin to fear that another panic like that
of 1878 may be near at hand. Yet there is no
monetary stringency on the contrary, the
money market is unusually well supplied, and
the rate of interest is exceptionally low. For
some time the Treasury has offered to redeem
any part of So, 100000 of three and half
per cents with accrued interest to date of
presentation. but there is so little demand for
money that only an insignificant amount OF the
bonds has been presented.
The circumstances are evidently peculiar.
While money is lending on call at per
cent, and even at 1l2 per cent, yearly, and
ninety day loans on the best collateral have
been made at per cent, commercial loans
are scrutipized with unusual distrust, and in
many cases refused where refusal would
have been thought impossible few weeks ago.
The distrust of lenders has caused great
shrinkage in the credit OF many firms and cor
porations, and inability to get usual or expected
accommodations pnches some severely. With
plenty of money available, the commercial
world is subjected to pressure not unlike that
of period of unusual stringeDey in the money
market, and each failure, as it becomes known,
increases the apprehension and the consequent
curtailment of loans.
But the circumstances are essentially diiier-
ent from those under which previous CONNER
cial disasters have occurred. There has been no
period of reckless Over-trading, and, except IN
certain branches of trade, the volume VI com
mercial indebtedness does not seem tu be large
1t is much greater, to be sure, than it was
when ahard-panr was reached in 1878. The
EXPANSION of credits in 1879 and 1880 was I'M
doubtedly great, but business was generally
prosperous then. and it was not until the disas-.
trous fall of 1881, with its partial failure of
crops, that commercial disappointment could
have caused much accumulation Of indebted
ness. Since that time the prevailing DISPOSE
ton has been altogether unfavorable to an ex-
pansion of credits. In fact the apprehension
of disaster has checked operations for fully two
years, 81 that, instead of dangerous expansion,
there has been almost constant liquidation since
the simmer of 1881.
In few branches OF business no Sever, tnere
has been wild and reckless speculation, and a
prolonged and stubborn effort to prevent the
decline in prices. The consequences to dealers
in lard, pig iron, whiskey and leather have
been disastrous. 1t is to be expected that
wherever similar causes have been in operation,
similar disasters may occur. The tendency OF
events for more than year has been con-
stautly and strongly against every effort TO
manipulate markets or TO maintain artificial
prices. The desperate speculations which have
disturbed the markets during this period haze
generally involved loss to the principal opera
tors, and deprived the markets of n healthy aud
natural support. In some Of these branches Of
business liquidation has not yet occurred, or
has been partial and Ineffective. and failures in
such branches of trade viii cause no surprise.
But, beyond the influence Of the speculative
fever business seems to be in u healthy condi-
ton. The volume of Indebtedness is not ex-
cessive: stocks have not been dangerously ac-
.cumulating; and prices have been adjusting
themselves for nearly two years to natura! con-
ditions. Because commercial disaster has been
generally apprehended it is the less likely 10
come.