New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1891-06-27
THE FINANCIAL OUTLOOK.

ACCT There is undeniably much hesitation in
| business and in most of the speculative mar
| l,ets considerable weakness, but this is IN part
! bacause large crops are. close at hand, causing
| = decline in prices. The Treasury disbu1se-
menfs make money plentiful here, but gold still
Zoos abroad in large amounts, in spite OF the
strong position of the great foreign banks. and
there is in financial circles not little fear that
when the fall demand comes, and large amounts
are needed for moving the crops, the return OF
Gold from Europe will be strongly resisted, and
the supplies OF money here will be inadequate
Nor can il be denied that there is some appre-
bension lest the country may be slipping away
from a gold basis, and In danger OF having
silver payments before long This apprehen-
sion however ill-founded it may be, undoubtedly
has some influence upon the action OF indlWd-
uals
IT, is wise to remember however, that the
enormous supplies of money sent to Europe were
needed there to prevent grave financial DIS
turbance, which might have affected this coun-
FRY most unfavorably. In averting this disturb
ance American gold has defended American
trade and industries more effectively by far than
IT, coud if it had remained here. During this
month and July the normal excess OF imports
over exports of merchandise is heavy so that
much gold has to be sent abroad on that account
alone. and when there is realizing on American
securities by European holders the movement OF
specie is naturally larger. 1t is matter OF
some surprise that the merchandise imports con-
time 50 heavy but this is in large part eyl-
dence of prosperous activity of industries here,
since the increase in imports is not mainly III
i in,
When this country wants its gold back again
for use in the fall there may be expected strong
resistance by European banks and tnanclerS'
For most of the gold taken from this country
has been sent to Russia, and there 1t Will be
held away from the financial markets OF west
ern Europe Strongly fortified as the great
European banks now are, it must yet be ad-
mitted that they will find it exceedingly trying
10 take from their stores or 10 gather from their
customers the $50, 1000, 900 gold which this
country has been advancing on merchandise
imported and stocks sent back. In resisting the
movement of gold hitherward European money
markets are apt to become strong and tight, so
that foreign holders of American securities may
be induced to sell still more Of them. II stocks
can be unoaded under such financial pressure
in amount sufficient to pay balances due for the
wheat and the cotton which Europe has to buy
flom this country the movement of gold may
be averted, and at the same time the scarcity of
money here may cause unusually low prices for
expcrtabe products. Also the foreign sales of
securities may not improbaby cause some de-
preston in the stock market.
While the force of these considerations can
not be safely overlooked it is also to be remem
bered that the buying power Of this country in
a season of good crops is almost incalculable
During the last year we have felt something of
the depression which partial failure in agri-
cultural production necessarily involves. But
there is now every reason TO expect that the
crops to be harvested within the next three
months will be of enormous magnitude. AL
though prices may be relatively low, the returns
to individual producers will be large, and will
enable them to clear off great body of indebt-
edness and to increase their purchases for con-
sumption. The activity thus induced in all
branches of manufacture and Of trade will be
felt in financial circles, and will add largely to
the buying power of Americans for securities
as well as for products. On other occasions
when Europe has been compelled to take large
ly of American products, the crops being heavy,
the absorption of securities in this country has
astoniShed all financers. 1t is within the lin
its of possibility that the home demand this
fall may take whatever securities Europe may
have to sell, and at the same time maintain such
a market for products that foreign countries will
be obliged to pay fair price for whatever they
purchase
The point of danger in the financial situation
is therefore the possible distrust Of the Govern
ment as respects its ability to maintain its cur
rency at par in gold. Every step taken by the
Administration or by the great financial insti
tutions which tends in any measure to increase
that distrust is to be profoundly deprecated.
The one thing needful during the next four
months is to maintain beyond possible doubt
the ability of the Government to meet all it's
obligations in gold to redeem in gold any of
it's notes that may be presented for payment,
and TO show that it not only intends but is
abundantly able as Secretary Foster distinctly
declared in his Ohio address to maintain public
credit and the parity Of gold and silver in the
currency.