The morning news., 1892-03-07
BANKER CLEWs' VIEWS.
The Financial Outlook as Seen From
Wall Street.

NEW York, March 5.-The stock market
is flooded with mysteries" and rumors Of
gigantic railroad deals upon an unprece-
dented scale as being either in progress or
already ACCOMPLISHED. Details of these
have filed the daily press for weeks past,
but only such operators as are within the
| charmed circles appear to know the true in-
wardness of many Of them. AS conse~
| quence judgment passes for little in esti-
mating the future value of many securities,
for the market is almost wholly under the
/ control of comparatively few persons, whose
| operations must inevitably influence the
value of thousands Of millions of stocks and
bonds. Never in the history of Wall street
was the value Of such an enormous aggre-
cation Of securities so absolutely under the
| control OF so small a circle as at this
time. Such a state Of affairs can
not be considered satisfactory /;
because not only is speculation likely to be
unhealthilv stimulated, but the future of
these combinations gives birth to variety
OF uncertainties which, while they may
elevate prices. will certainly not add to
their stability. There is little question but
that in the end some of these combinations
will work for the best interests of all con-
cerned; but in proportion as their result
! means increased pronts TO capital without
corresponding benefits to the masses, and
ton we may, sooner or later, expect the
awakening of active public hostility.
! Aggressions OF this sort by capital are sure
to be followed by reprisals on the part Of
labor: while the demagogue In politics re-
quires no better material for his auti-
monopoly cry than these combines TO
restrict competition, and the labor agitator
finds his best argument for q strike in the
| increasing profits OF capital.
Reasons such ag these cannot he iOnOred
In estimating the distant future, but it is
the more immediate future that Wall street
| Is now concerned about. While the stu
alton presents many natural conditions of
great strength, especially those based upon
the development Of our natural resources
which tempt US into being at times too opti-
mistic, still there are some very suggestive
features which call for prudence Although
stocks are in strong hands, the public whose
operations are necessary to a healthy bull
market have not yet taken vigorous hold,
! and the cliques responsible for recent ad.
vances have been incumbered with millions
of stocks sold by foreigners which they
never calculated upon. IL Europe takes
| back these stocks they will be much relieved,
il not they will have more TO sell. In either
event they have a large undertaking before
| them TO induce the public to take their
stocks at the higher range OF values. Cir
cumstances, however. favor them in many
ways, and when this unloading process
starts in we may expect some lively and
| erratic movements.
There is one other factor which is again
becoming influential in Wall street, and
that is the silver question. Already it is
! producing important effects which had not
been expected to appear at this early stage
| in the outworkings of the silver act of
! 1890. The renewal Of the exports of gold
has proved an eye-opener. During the
| year 1891 our exports of goods and specie
) exceeded our imports of the like items by
| sls5. Oo0, 900, and for the first two months Of
1892 fully the same rate of excess has been
maintained. II might have been expected
that under such circumstances we should
now be importing large amounts OF gold to
settle this large apparent trade balance In
our favor. The fact is, however, that we
are called upon to export gold. How are
we to account for this extraordinary move-
ment? After setting Off. against
this creditor balance of some S2l5,-
O0O,0 900 for the last fourteen months,
all that may have accrued against
us in Europeson account OF interest, freight
on imports. underv aluations, etc., there
ought TO be a balance in our favor of some-
thing like S115, 900, 900; for an average of
the last decade. about $S5, ,000, 900 surplus of
exports over imports has sufficed to
lquidate these debtor items. There arises
from these the strongest possible presump-
tion that, since the beginning of 1891, con-
siderably over $l00, ,00U, 900 OF our securities
have been returned from Europe; for the
credit balance has unquestionably been set
tied, and there is no other way in which it
could have been done except by the return
of stocks. bonds, etc. This refiux of our Sc
curlties dates from tho period of the enact.
ment Of the last silver law. which doubled the
government purchases Of silver. 1t is coin
cldent with an opinion everywhere enter
tanned in European financial circles, and
emphasized by the foreign press, that the
course of legislation aud the bias of popu-
lar opinion in this country indicated grave
possibility that our currency system might
become subject to a general depreciation OF
value, which would corresp )ndingly dimin-
ish the value Of all s9oU rites not made speci
ficallypayable in gold. As Europe holds many
hundreds of millions Of American secur-
tiles of the very kind that would be subject
to such deterioration, it is nothing more
than might be expected that our obliga.
tions should be returned in extraordinary
amounts, and the more 50 as the New York
market has been in condition to take
them without suffering serious reaction.
Over $100,000,000 of securities
returned within fourteen months
This is startling fact just
dawning upon the perception of Wal
street; and it naturally suggests some very
IL
much gold should we have had to ship in pay.
ment for these returned securities, had W.
not been favored with an extraordinary
surplus of cereals which Europe happened
to need? how are we to pay for any further
amounts that may be so returnedl what
dimensions may this future refux of in
vestments assume, should the mania foI
free coinage continue to control the course
Of legislation? and, with only some
$30,000,000 of gold in the treasury, outside
the required reserve against green
backs, where is the gold to come from
TO satisfy these two possible foreign drains
1t is thus seen that the sive
mania is bringing us much nearer to peril
Gus verge than it is pleasant TO contemplate
and that unless the madness of free silver
} agitation can be in some way stayed, we
! may witness a serious disturbance Of publi
? confidence much earlier than has been sup
, posed possible. Under these circumstances
, the main hope Of Wall street is in the posi-
: ble formation of an international conferenc
, TO settle the whole silver problem upon
! broad and sure foundation. Secretary FoI
! ter's visit 70 Europe for the understood pun
e pose Of conference with the British govern
meat Is therefore hailed with great satisfac
; tion as affording q wey OF escape frof
. | grave possibilities. HENRY CLEWs.