The morning call. [volume] (San Francisco [Calif.]) 1878-1895, 1893-09-28
THE BUSINESS SITUATION.

1.-THE recovery in business is slow but
Eeady. 1t is quite decided at the financial
Eenter d the East-New York. The banks
now hdd large surplus over the required
% per cent reserve. They have reduced
the vlume Ct certificates afloat to about
$50, 0Os000 and the redu ction proceeds az
the rsie of about S250,000 day. The BOs-
ton binks have reduced their certificates
to less than 100000. Money on call in
both cities is worth about 8 per cent and
mercantile paper is beginning to move at
the old rates. Domestic trade reflects the
lingering condition and timldity; the bank
clearings are still 26 per cent below those
OF the same period last year, but they are
increasing. Manufacturing industry is
picking up. Dun's last weekly review re-
ports the reOpening of fifty-eight works
with full force and twenty-four with. a
small force, against fifteen works closed
and eight going on with a reduced force
a better inquiry for both woolen and cot
ton goods is reported. The movement in
grain the Atlantic ports is slack owing
TO the refusal of the markets to respond to
the accounts of reduced yield. Stocks are
dull, as is usually the case after panic,
but foreign investors are said to be taking
advantage OF present prices to reduce the
volume OF loose securities afioat.
There is nothing in the prospect which
contradicts the belief that the worst Of the
crisis has passed. While the staple crops
will not be as heavy this year as they have
been in some recent years, they will be
ample for the wants of consumers, as mar
ket prices show. 1t seems likely that all
the rotten spots have been probed. There
are no indications of heavy failures 10
come. The industrial stocks in the East
are still sources of uneasiDess, because no
one can tell what they really represent
but concerns which have weathered the
storm thus far are not likely to 90 under
now. 1t is noticeable that there have been
no defaults By great companies, such as
usually occur in financial crises.
The crisis Of 1898 will go down to history
as phenomenon not 10 be accounted for
Such catastrophes are generally the sequel
80 periods of wild speculation in stocks or
goods or lands. No such speculation has
prevailed. Last year was a dull year in
Wall street; the great staples have all
been selling at low prices; there has been
no boom in lands. no bank expansion, no
great extension Of our railroad mileage
When The summer opened the feature of
serene tranquility. Yet with the hot
weather came wave of dstrust which,
though it seemed to have no real cause,
swept over the country from San Francisco
to Boston and produced as severe results
as the panic of 1873. 1t was one Of those
accidents which no one can reason out.
Financial typhoons. to whatever cause
they may be due, will always ba grave in
country where the credit system pre-
walls as it does in the United States.
vast proportion of the business done in
this country is done on credit. Many mer
chants do larger business than their can
ital warrants. Others lose their capital.
keep the fact a secret and 20 on by leaning
on their bank. Others again never had
any capital, but trade on their credit and
the goodwill of their friends. All these
dealers are really doing business with
other peoples money. So long as the skies
are serene and confidence is mistaken,
they trade as if they were capitalists. But
when the other people, from some reason
or other, want their money. they cannot
help topping over. Again. there is always
certain proportion Of persons engaged
In trade who are insolvent, though the