The herald., 1893-02-11
RAID ON OUR GOLD RESOURCES.

The extraordinary shipments of gold
to Europe during the past six months
have 30 materially depleted our store Of
that metal as to cause the most intense
anxiety in financial circles. The last
number of the Henry Clews circular
says that the gold output during the
past year has reached the enormous
amount of s62,000,0 900. And this tre-
mendous outflow has been in spite of
the commercial balances between this
country and Europe, for the trade bal
ance during the last three months has
not been such as to call for any extraor-
dinary shipments of specie from the
United States. Financiers declare that
they cannot satisfactorily explain the
causes for this protracted raid upon our
gold. The startling revelations in the
Panama canal investigations have 30
shaken confidence in the French gov
ernment as to cause a severe contrac-
tion of credit operations by the Bank of
France and subsidiary institutions, the
tendency Of which has been to draw
gold to that center. This is evident
from the fact that the Bank of France
now holds $S7, 100000 more gold than a
year ago.
The anticipation that grand struggle
between some of the great powers of
Europe is close at hand has had the
effect OF inducing those powers to gather
in and hoard all the gold they can get.
They we'll know that the military chest
will cut very important figure in such
a struggle. A curious fact in this con-
nection is that the increase of gold in
the Bank of France ($57 200, ,00O) and
that in the Austro-H hungarian bank,
which has been forelaying to enable the
government to turn to single standard.
($25, 900, ,000) would just equal the sum
lost by the United States by the great
outflow.
Another bad feature of this raid by
Europe upon our gold is the fact that
1t has 30 far operated upon the treasury
of the United States as to bring its gold
down to the very verge of that required
to be kept in order to cover the percent
age of reserve held by law to redeem
the outstanding treasury notes. The
failure of the monetary conference to ar
rive at any satisfactory conclusion in
regard to silver has also had the effect
to cause the English financial institu-
tions to increase their gold reserve, and
the depletion here has been accelerated
by this fact.
All Europe seems to have had its eye
upon our gold, and has gone for it with
an unprecedented alacrity. AS Clews
says, there is limit to our exposure to
depletion by these processes aud it
would seem as though such drain
cannot 60 much farther. There is also
this satisfaction, that if the dangers
should really happen against which
these boards have been accumulated,
the catastrophe will have been provided
for in advance, and the exposure Of the
United States to drain will have been
correspondingly diminished. Our ex-
posure to this sort of thing is no more
than might be expected from our large
dependence upon European credit; but
it should surely be serious question
with Americans whether this sort of
subjection is any longer a necessity, at
least to such an extent as it now exists
and whether, with our vast increase of
wealth, the time has not come when we
should have credit institutions compe-
tent to relieve this country from foreign
relations that expose us to all the politi-
cal and financial dangers OF conditions
in which we have no direct interest.