Wichita eagle., 1890-03-09
A VERY SENSIBLE VIEW ON THE
HARD TIMES.
WICHITA, Kan, March Z. 1896

| 1C the f,dltOr oI ine EdSte
There has been SO far, if I am right.
two general theories advanced as to the
cause Of the present business depression.
First, that of Mr.. Davis to the effect
that the world has surfeit of, and there
fore no market for farm products. The
other theory assumes or implies that
there isn't enough money in the country
to do the business Then comes brief
statement in recent issue of the EAGLE
which seems to adopt the first part of the
last named theory but to modify the
latter part of it by proposition which
If true would be most deplorable. Irefer
to the statement in substance that while
there are $51 per capita in existence
which should be IN circulation, there
are, owing to the large holdings in the
vaults of corporations on various pre-
texts, not to exceed So per capita in
actual circulation. The plain meaning
capita in volume money has been
''cornered," in pursuance necessarily of
pre-concerted plan and for the deliber-
ate purpose of producing the present
| depression. The truth of this theory
/ repeat would be most appalling,
especially when we remember that in
order to accomplish the result 81. 740.-
| 600, 600 would required to be horded IN
those vaults, leaving only one-eighth of
that sum in circulation. Can it be true:
II it is, farewell, Oh hope, for the future
| But | am 10th to believe the proposition;
not that | doubt that there are large
sums being held in vaults: on the con-
trary, common daily observation teaches
me that money in small, as well as large,
sums Is being held onto by everybody
with very extraordinary uenacity, [
agree with you that this holding onto
money Is the cause of the depression,
but do not agree that it is being done
| only by certain classes or for the purpose
of producing the depression. If we can
agree that this holding onto money is
the Immediate cause of the depression
and that it is done either willingly or
from force of circumstances by all classes
and conditions we have then but one
more step to take. in my opinion, to
reach the correct solution OF hard times,
and that is that this same holding onto
or outstanding money is not only the
cause, but is also the result of the de-
preston.
If you have reached, but hesitate in
taking, this step for want of further evil
dence, then just ask your neigi1bor why
he wears his last years hat and
see if he doesn't answer ''hard
times" Or ask your more fortunate
neighbor with money in bank why he
doesn't invest it. and see if he doesn't
answer, that SO long as all kinds of prop
erty is depreciating, money is the best
thing to have. This last step then, if per-
force taken, brings us. as | believe, to
the true answer of the problem, e: That
period of hard times feeds on its own
offal; that it has, outside of itself, no
cause for its existence: that 1t is a mere
panic or stampede from property in the
direction of money, and | think little
study will prove that, like all other stam-
pedes Or panics, they never have ade-
4uate and many have very Insignificant
beginnings, but that ouce fairly started
they are not only self sustaining but con-
tain within themselves all the elements
of rapid and malignant growth and
Development
think can not do better, in order to
be clearly understood, than to trace, ac-
cording to my idea. the rise, progress
and fall of one of these periods of de-
of these periods always depends for its
inception uDon the prevalence, to a
greater or less extent, of the idea that
hard times have begun or are just about
to begin; that is, that money is about
to become close and higher priced.
This idea may be engendered
in various ways. For instance. by the
sudden decline of an extensive real es-
a bOOp1. or hy Saripc of Shprt cronc
over a considerable extent of territory,
or merely by the unfounded superstition
that we are bound to have periodical de-
pressions from seven to ten years apart.
We will say that by one of the above, or
some other, means ten of IS per cent of
the people become thoroughly convinced
that hard times are just about to set in.
This idea alone, with those who enter
tain it, depresses the value of property
and enhances that of money. Beginning
1T once to act upon their belief they
make sudden break for money; they
tighten their grip on what they haye
and begin to drop property of all kinds
as fast as possible, buying IN the mean
time only such necessities as they are
compelled to have The extra amount
of property of all kinds thus thrown on
to the market, the like falling off of
buyers, and the slightly diminished vol
ume Of money produced by some being
thus withheld from the channels of
trade, produce perceptible depression
of property of all kinds and a cores
ponding rise in money, genuine symp-
tom of hard times. which convinces
another 20 or 80 per cent of the people
that hard times are upon us sure enough:
hn hn h.1S
intensified and repeats itself till the grasp
on money, the anxiety to get ria Of all
kinds of property, and rigid economy OF
living, either enforced or voluntary. be-
come universal. This rigid universal
economy in living means, by the way,
vast under-consumption of nearly all ar
tlcles or commerce, which combined
with the craze TO sell property, soon
brings about the aspect of over-produc-
ton, not only sending property lower
and again lower, but by checking pro-
duction great numbers of people are
thrown out Of employment-one of the
most distressing features of bard times.
Such is a brief outline of my idea of
the rise ana progress OF hard times. The
fall is like the rise, only less rapid; the
belief necessary 10 start it being more
difficult 10 become established. but finally
some of the people become thoroughly
satisfied that the bottom has been
reached and that times are going to be
better. They begin 10 loosen their grip
on money and reach out cautiously for
property: this soon begins to strengthen
property and others becoming convinced
that the crisis is past, follow the lead of
the first and soon confidence Is restored
and things again reach an equilibrium.