New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1884-05-16

On the firm partlv on account of timidity at the
financial prospect and partly to satisfy the de-
mands made on them by their depositors' Inc at
tempts of Fisk & Hatch to raise cash on their Sc
curities we're made futile by the peculiar condition
of the money market The decline in the prlce OF
Government bonds was a serious matter to them.
President Oscar d. Baldwin, of the Fourth Ma
tional Bank, was asked whether the firm was
large borrower of the bank. He replied: 1t was
not 1t kept an account with u.s. 1t has very good
balance still In its favor. Ii has not drawn on us
largely to-day. / do not know the cause OF the
failure, but suppose that it due TO the fall IN
the price of Government bonds. Fisk 81 Hatch
were the largest firm i'll this line in the Street, and
of course i'll the country"
"But how could so strong firm fail when the
drop in Government bonds was only from y TO per
cent ~ 4 -,
Ii has been the custom of many banks to loan
on Government bonds within 1l2 or per cent OF
the market value. In our case we pave always re-
Qulred 10 per cent margin. When the price OF OoH-
ernlnent bonds fell some of these banks called III
their loans, the firm was unable To respond ana tne
Government bonds were thrown on the market.
This | suppose, the course taken Wnlch pre-
ciptatcd the failure"
A prominent bank official with whom the firm has
done business SAID: q" he firm has probably ialled
because il has been carrying loans procured ron
banks on very EGht margin on Goyernmcht pohuf;
The amounts thus procured have been ioaheu
to various large corporations the hrln taxing
their securities very small drop Ill DOFeih-
ments was all thatwas necessary exhaust the mar
gins ne firm and the bonds were hcn thrown upon
the market The securities Of some of the raifoaos
that the firm have been interested III nave faile
very much IN value within the last few days, and
the banks have been very chary indeed IN lOanlhg
on some Of them at any price. SECURITIES or thlS
kind hateycr may he their prospective value, are
ve!y apt to drop invalue win ai"rnlng rapiditS
when pressed Tor raia, as baS been demonstrates III
several instances within the past TWO OF thiee
days, - - ,,.o. o-,,,,,. of t,o FIRMS
That is difficult to say, because he firm has
operated largely, although understood 10 De very
conscT ative IN its opera;ions II WI ne ol cOic
MANY millions | do not think, thOugll, that ihc
creditors Will lose heavily. The firm will probably
procure an extension from the leading creditors ~
resume a. soon II can bc done with safely. lhiS
is purely suppoSlticn on my part, thouEh. ne
house has the sympathy OF al on tine street III mas
acted IN an honest aud manly way III n" past ana
will continue to DO so IN the present emergency
WHAT THE EFFECT WILL BE.
William Lummis, who has become the acting
president of the stock Exchange through the fail
ure of Fisk Il Hatch, said:
The failure VIII have much es' effect on tho street than
is generally supposed II j. unfortunate ~ tlat y giVes
another shock 20 public cOnhdence but 40 n9t beeve
that It viii involve lny otaer no ise The firm have rev
contracts the EXCHANGE and there viii not be many
sales Tor their account tomorrow.
A friend Of Fisk & Hatch. who had been convers-
ing with Mr. Hatch after the failure, said
What losses there will be will probably fall on persons
outside OF the city and on the firm he iirm nave not
been dong large STOCK and they nave few con
tracts to settle the stock Exchange. The failure has
probably been prccptatri by the calling OF loans on
Government bonds collateral to which the in coud
not respond time account Of the high pncc o money
and the recent Withdrawal OF balauces ny country Gus
toners There is GOOD reason 10 ascDc inc failure 10 Nc
collapse OF the Chesapeake and ohio Railroad IN 1873
and ihe tLe firm since t0 pay priiclpa ana n
tercst back to the original investors while
this determination reflects great credit on
the honor and honesty OF Fisk n Hatch,
they would be better of they ID settled the affairs OF
The company at the time whatever b'ss they were
able 10 pay upon. know that th- i thought That they
had been perfectly covered by the advance in III
the compaly's securities since that ume, but
the sblinlagc Of values in the last two
wears mas brought back thcr old financial trOu-
bes. The Chesapeake and ohio securities have been
dcnlt negotiate, and the stcs' OF the last few days
has proved too much for the house 10 weather Tie
assets of the concern consist largely OF Government
bonds and It's Gaal settlement ought 10 be favorable one