The Helena independent. [volume] (Helena, Mont.) 1875-1943, 1891-01-28
MONEY PANIC REACTION,
Tho Market Now congssssd, Quite
In Contrast 10 tU Re-
VII cant Condition
banker Aenry ciews on the Nf.
feet and Character VI Sill
vcr Legislation.
yewidsrs nj RAILROAD ~sesntilts~ 1fHve Mn
Advantage EDxIiss Capital invssisd
In America Last summer.

Ngw Y0nH, Jan. 22.-~,The reduction of tho
discount rate 10 thfas and n haif per cent
by tho bank Of England IN an shdsx uf the
c0ngested condition ~ money IN London.
Tho term ''congestede being applied now
10 money m IL WIS but a few weeks aao 10
securities IL n change that IL quito remark.
ablo, and IL beginning 70 apply wth equal
force 10 New York NJ vol ~ London. This
fully veriHes my prediction mnde solno time
ago NJ TO tho future Of money, 10 u ~reaction
from the money panic that WINS then pro-
vniliDg. ThS stock market has boon stopped
In It's rise owing 10 this threats Of congress
to pass the free silver bill. In delay Of
action In the house strengthens materially
the opposition to the measure, and 1t has
now become quito evident that none but a
compromise bill will finally become law,
and the compromise IL likely to result In
changing the present law, which provides
for the purchase Of 100000 ounces per
month, to 100000 ounces per month.
No serious harm will accrue therefrom;
at any rate, certainly less than would BIO
derived from free silver legislation. II the
compromise can be made to include the re-
striction of confining the 6,O00,OO0 ounces
to the product of the American mines, and
put a duty on all imported silver of saw %
per cent. it would be a wholesome feature,
in which event the purchase Of 100000
ounces would produce the effect generally
desired of advancing the price Of silver to
approximate closer to q parity with gold.
It il now generally known that the product
of the American mines at the present time
ia close on to 60, 100000 ouncer per annurn,
which ia 100000 ounces moro than now
absorbed by the present law; and it is that
surplus, though small, that really makes
the price for the whole product as against
the United States treasury effort to mark
it up. Now then. the purchase of 6.0OO,OO0
ounces per month will make q demand for
12,OOO,O 600 ounces beyond the supply, the
effect of which upon the price, when fully
realized, cannot but be self-evidert to tue
most obtuse.
Holders Of railroad securities have this
advantage at the present time, which. should
be reassuring. The manufacture of them
has ceased for tho time being anyhow,
while The government manufacture of mon
ey is on the increase to SO great an extent
that after a while there will be a decided
inclination to exchange the latter for the
former, in which event prices for good
properties will naturally creep up to high
er figures.
The railroad presidents combination
continues to develop its scheme. While it
may not accomplish all that Is desired, At
is step in the right direction, and is an
entering wedge to the formation, sooner or
later. doubtless, of a clearing house system
for the division of railroad earnings, which
can be regulated somewhat on the same
principle as the New York clearing house
governs banks. Diminished eastbound
freight earnings for the next few months
must be expected, but westbound are likely
to increase sufficiently to make up for
should keep a sharp lookout for the net
earnings of railroads hereafter, as that is
going to determine values in the future, and
not the gross returns, which many have
heretofore been influenced by. and were
found SO misleading last year.
coinage enormously argue that it will cause
another unloading OF American securities
from London holders. There is not much
in this, TO. the reason that this country was
made to take, during the Barring Brothers
panic, about all of the marketable American
securities that could be sent over from
there; therefore this country occupies at
present the happy position of not being
likely to be compelled under any circu1n.
stances to take a large quantity of that
character of properties. rs they are not
held there for sale. The American securi-
cries and such like industrial concerns,
which we OF this side have no market for,
consequently they will nave to carry them
indefinitely, as they now do the Argentines
and such like evidences OF indebtedness.
However much they might desire to unload
them, it can 20 be done, as they are really
shut off from sending them back to this
side.
One of the things that helped this coun-
try during last summer was the fact that
London secured the whole of America for
industrial schemes, capitalized them and
floated them in London, which gave this
country in their place the equivalent of
S15O.OO0. 600 in the nppreuate. That WAS
what placed this country in such a staunch
position, and enabled New York and all the
money centers of this country to how SO
strong a financial front and pass snrough
the recent panic, leaving so few wrecks and
comparatively SO little disaster behind;
hence the recuperation will naturally be
quicker than ever before experienced after
any previous crises that stand on record in
this country. HENRY CLEws.