New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1884-05-19
no. WY IND BTNINESS.

charges of rong-dOng in connection with
them, were calculated to disturb confidence very
greatly. In the panic that ens%ed, securities
were thrown overheard with scarcely any re-
gard for their real value On Saturday May
3, severe decline having already followed
period of unusually prolonged depression, many
of the most conservative houses were looking
for considerable recovery, and it is not UNI
likely that one would have appeared if the
firm of Grant, Ward & Co. had not been so far
gone that nothing could prevent Its collapse.
At the close that day the average price OF forty
most active securities was only $63 90, against
so IS for the same securities at the lowest
point in January last. But Grant Ward q Co.
failed on Tuesday, and the average at the close
OH Saturday. May 10, was only SOL 10. Inns
proved to be only the beginning OF disaster,
and on Wednesday, the 18th, at the lowest point
the average was only $542 p, the decline hay-
Ing been So % per share on the whole list, or
IL per cent in less than three business days,
following decline of 81 80 per share, or per
cent, during the previous week. From tins
point of extreme panic there was some recovery,
so that even when Lake Shore made IFS plunge
TO 81 on Friday, and Northwest fell below par,
and Pullman to 81, and Lackawanna to 1OGl2,
the general average was still $54 IT, and at
the highest point on Saturday it reached 500 II.
This proved too rapid and too large an advance
to be maintained, and the closing average on
Saturday was sos 50. But even then the prices
were over 8 per cent above those of the panic
hours on Wednesday, gain which sufficiently
illustrates the unrcasoning temper of the panic.
Unqucstionably a great many stocks were
forced upon the market by the sharp contraction
of loans. to which the banks TcsOrtcd much too
late for their own good. Months ago, had the
banks resolved to Curtal their advances III ala
of speculation, and pursued faithfully policy
of steady and gradual contraction, much mis-
chief for them and for the public would have
hrrn avoided Obviously it was not pleasant
for institutions to find that the customs tOler
ated after the law prohibited certificatiOn had
exposed them to great wrong and loss, but the
risk of those practices was not discovered Tor
tIp first time when Wards checks were found
To have been drawn against nothing But it
suddenly came TO pass that financial instltu-
tions lost confidence in the sOlvency Of specula-
tive borrowers, some of whom were seen 10 have
been far from solvent, and that the public lost
confidence in financial institutions, some OF
which were seen to have been outrageouSly
mismanaged. Some banks had been feeding
speculation, and helping to maintain fictitious
prices, until they had become utterly hollow.
On the other hand. persons and firms previously
accounted wealthy and honorable had been
Numbering both banks and the public to meet
losses in speculation. But the state OF things
which rendered serious contraction Impossible
,yithout colapsc. though it had evidently ex-
listed. does not seem to have been generally snS-
nected until the contraction had continued for
some days.
Within the past two weeks the banks have
emf down their loans $15,3507O0, and their
deposits Sl6,Ol4, 900 Deducting the Marine
hanks figures, the shrinkage both in loans and
in deDosits was about $11 100000. In specie
there WAS net gain OF 1917 900, notwlthstand-
ing the omission of the $l,OOO0OO reported
for the Marine, May g. while the loss in legal
tenders was 81 ,999, 700 for the two weeks, or
ST. 100. 900 more than the Marine had held May
,. BY curtailng the reserve required by
"a 900. 900, the banks are enabled to show
a surplus of 50, l27, 600, against only $oOG,OOO
two weeks ago, but they have lost III reserve,
notwithstanding the large amount OF money
attracted to this city by sudden stringency IN
the money market. The truth is, the trouble Ill
the markets has not been lack of money, but
lack of confidence.
The Treasury has taken in considerable
sum if is true, but the public demand has not
been for silver or legal tenders. but for gold or
Gold certificates. Thus it appears that the
Treasury has been called upon to put out
St191 $50 more gold certificates.than were out
IL =. Id "A
standing two weeks ago, though only - HUI"
ronrcscnts the increase of gold in the Treasury.
II annears that $2,l85,220 silver certificates
have been thrust back into the Treasury, and
redeemed in gold through the custom houses,
the increase in silver held being $957,619. 1t
also appears that the public holds $4l9l,96o
less LEGAL tenders and lcgal-tender certificates
than were outside of the Treasury May ).
Hence il seems plain that there has not been
pressure for increase of currency IN circulation.
The proposed outpOuring of several millions by
tbe Secretary of the Treasury would not meet
ony perceived need for more currency it would
do good only if it should tend to restore conf
dence. and to relieve institutions and borrow
ers from ENHANCEMENT in loans on the safest of
all securities.
The contraction to which banks and other in
stitutions resortod i'll order to protect them
selves. though it affected legitimate trade to
some extent, was chiefly felt in the speculative
markets In those markets, too, 1t was chiefly
felt By dealers in securities and in oil certih-
cafes. The violent decline in pipeline GER
ti(icates was not the result of any change in
present or prospective supply OF demand, or in
the price of refined oil ; it arose from the fact
that New ork banks and operators, In strug-
Cling to sustain themselves, threw overheard
property with which this market was least ia
miliar The change in wheat was not 30 great,
though June options at Chicago fell cents at
one time below the price Of two weeks ago, and