The Wichita daily eagle. [volume] (Wichita, Kan.) 1890-1906, 1893-02-07
THE GOLD MOVEMENT.


| NEW YORK, Feb. 6.-Henry Clews, in
his weekly financial circular, writing of
the present movement of gold to Europe,
| says:
''The export of gold, upon so large a
scale, and contrary TO general expectation,
naturally has depressing effect upon the
market for securities and holds in check
| the upward tendency in prices arisin z
| from the concurrence Of several influential
| factors intrinsic to the value of invest
ments. During the first four weeks of
this year, we have shipped from this port
over $l1. 000, 900 of gold, compared with
merely nominal amounts for the same pc
riod in 1892 and 1891, and there is no clear
assurance that we have yet reached the
end OF this movement. Did the outflow
depend upon the purely commercial ball
ance with foreign countries, there would
be some ground for expecting its early
end; for the trade balance for the last
three months has not been such as to call
for extraordinary shipments of specie; and
it may be further cited that the foreign
movement in our securities has balanced
in our favor. probably to quite an appreci-
able extent.
THE real causes of the outflow are of an
extraordinary character and cannot be sat
lS1dCiOGllS clbucE dS 10 JUclE eA-
tent or their probable duration The dis
turbing influences are partly political and
partly monetary. The startling Panama
revelations in Paris have so shaken conf
dence in the French government as to
cause q severe contraction of credit opera
tions by the Bank of France and by the
other Paris financial institutions, the
natural tendency OF which has been to
draw gold to that center. Similar but
more recent developments of official cor
ruption in Italy have given an impetus to
this arrangement in credit operations and
have widened its area. And the remark
able declarations of Chancellor Capriyi as
70 the tbre atening armamentS OF the great
powers ana the consequent necessity for
Germany Immediately Y putting herself in
position for undertaking aggressive opera
tionS can not but bring over Europe
sense of its nearness to the great struggle
which has so long appeared inevlta able, but
not hitherto actually imminent. The new
Egyptian question looms up as still an
other factor. From similar political
causes, Russia has during the past year
been steadily withdrawing her depos-
its on the continent, which are
supposed to have gone into her military
chest; and it is suspected that the hoard
ing of Austria-Hungary has also been for
military contingencies as well as for her
preparations for establishing a gold finan-
cial basis. The distinctly monetary causes
of this gold movement have been the ap-
prehensiOn Incident to the position of
silver and the failure of the Brussels con-
ference TO devise any means for staying its
demonetizdtiou. To the Bank of France,
this Is grave situation. Having issued
notes 10 the full amount permitted By its
charter. 1t can put out no more paper for
the procurement of gold, and in the event
of a crisis might have to use its silver in
n which 1,nHar h.
ent state of the silver situation, might
prove to the last degree perilous. Under
these circumstances, the bank has to en-
force liquidation Of its loans, and the PARIS
joint-stock banks are following suit,
especially such of them as have branches
IN London, 10y stopping purchases of
English bills; the effect Of which is to
draw gold 10 Paris, notwithstanding the
banks inability to make direct purchases
OF gold. ConcuFrently with these iufu-
ences, the absorption of gold by Austria,
for the purpose OF establishing the gold
standard, is continued without abatement
The effect of these political ana none
tary conditions Is apparent in he fact that
the Bank of France now holds $31 ,0OJ,-
600 more gold than a year ago, whist the
AustgO Hungarian bank shows al increase
il holdings Of S25. .000, 900. The combined (
aCCumuiatlOus OF these two banks
TO So, 600, tO0-almost exactly /
correspond WITH tue net export OF god (
from he United States in 1872, which is Z
stated at $50 OO0,O00 The con- /
uectIOn OF Cause and effect Is here so OBJ +.
Ylous as to tell lis own story. This trans /.
ference has come about through a natural +
b tnkIng process. The contraction of large (
credit operations on the continent has ne /
cesSiiated like restrictions Of credits in
Great Britain, and inst IN turn has caused ,
some contraction in England's relations I
with the United States and has iuduceG /
Withdrawals of bankers balances from rm /
pl0yment IN this country. This seems to .
be about the only rational explanation OF +