Los Angeles herald., 1891-11-28
THE FINANCIAL OUTLOOK AT HOME AND
ABROAD.


small space considerable common sense
in the discussion Of financial affairs. 1t
is true that when there is big Wall
street deal to be made and the country
is to be MIXED, they stand in with the
game. That was the case few months
back, when great conspiracy was en-
tered into by Wall street to wreck the
country on the strength of the gold scare,
when the exigencies of the European
banks drew out from the United States
no less than $40 ZOO, 900 in a short space
of time so as to fortify their reserves.
This viliainous conspiracy OF the gold
bugs was knocked in the head by an act
of Providence, which gave our country
unprecedentedly large crops in the face
of an extraordinary shortage in Europe.
This was seen before the conspiracy had
ripened, and the gold bugs had to seek
cover in the face of rehux OF the specie
that had gone abroad. Clews x Co.
were forced to send out an extra
circular to eat up the words
and to qualify the predictions of the
one they had just issued in the interest
OF the conspiracy. But maugre such
breaks as these, which make every
body take their counsel on financial
matters with good deal OF salt, when
there is nothing in the air to induce
them to bull or bear the market they
send out circulars which give, in few
words, clear and logical statement of
the monetary situation.
Notwithstanding there has been an
unexpectedly liberal gain in bank re-
serves. and very material increase in
railroad earnings the last month, the
stock transactions at the New York eX-
change have shrunk to about one-third
the volume OF really active business.
The chief cause, however, of this mac
tivity is ascribed by Clews to the condi-
ton of the European markets.
At present, the financial centers of
the continent are exposed to very Sc
rious extent of sympathy with variety
of unhealthy influences, most OF which
have been long in operation and seem
to be now reaching a elimination.
There, as in this country, there has
been great deal OF revolution in the or
ganization OF industry, which has re-
suited in the formation OF large corpora
tions, for the most part floated on an in
flated capitalization and financed upon
loose speculative methods. The Sourses
are glutted with these unstable issues,
and in too many cases the banks even
are dangerously loaded up with them,
and yet dare not force them to sale.
Again, the competition for foreign COM
merce as between the European states
has been increasing in severity, with
profitless results and the consequent in
Movements to some OF the commercial
banks that expose them to distrust.
Further, the Barring suspension and
South American affairs generally have
started an industrial and commercial
reaction throughout Europe, which is
attended with declining prices and
with the distractions to credit
that always attend such state
of things. The evils are aggra-
waited by a failure of the crops that
threatens to deplete Europe of the gold
SO greatly needed to buttress the banks
under such adverse conditions. Added
to all this, there is condition OF inter
national relations which threatens to
precipitate the great conflict between
the eastern and western powers which
has been so long impending and has
each succeeding year seemed to become
more inevitable. The crop failures Of
France and Russia increase this danger,
as they afford tempting opportunity
for the driebund to force the wearying
disputes to settlement. Moreover,
Judging from seemingly authentic out
givings. Germany is preparing herself
for serious action in the coming spring;
although it is possible those intimations
NAV be intended for diplomatic effect
rather than to reflect actual purposes.
This is the complication of influences
now agitating the European centers;
and it cannot be denied that the situa-
ton is an unusually grave one, calling
for the utmost conservatism, calmness
and taking-in OF sail throughout Europe.
Naturally, under such circumstances,
there is an effort to realize upon large
amounts of the securities of the govern
ments most directly involved in these
dubious prospects. For the last two or
three weeks, both Paris and Berlin have
been selling largely of Russian issues,
the amount of which held in France is
estimated at $50O,OOO 900 and in Ger
many at 81 800, 100000. The bankrupt
condition of Spanish finances is also an
element of danger. The Bank of Spain
has exceeded the legal limit of its note
issues and proposes to further disregard
it's constitutional restraints; and while
confessing its inability to pay tenn
porary loan from the Rothschilds of $l0,-
OOO, 900 is asking for further advance
of SIC. 100000. And yet France is esti-
mated to be holding some $SOO,O00,-
600 OF Spanish securities of one kind
or another. Italy has been severely
hurt by its recent panic, and confidence
cannot yet be said to be returning in
Rome. At Vienna, the state OF finances
is one OF high tension; and nothing is
being accomplished towards restoring
confidanea in Portupal