The Seattle post-intelligencer. [volume] (Seattle, Wash. Terr. [Wash.]) 1888-1914, 1893-05-08
AUSTRALIA PAxING FOE ITS BOOM.


The Australian colonies daring the last
month have suffered frigEtfal financial
collapse. Since april this Commercial
bank has failed f.. $50 000, 0os the English,
Scottish and Commercial fAaled for $40.-
OK, 900. the Australian Joips Stock bank
failed for $50. Go 100, and the Standard
bank for S. 000, 0(0. . total tef S165, 900, 900.
The Australian Colonies are going through
bankruptcy. and default l., che govern
ment bonds is believed to SO inevitable.
The bonds depend for thei, interest, not
on taxes, but on the receipts OF
railroads and ether public enterprises,
and the Australian railNoad system,
ing circumstances earn interest on their
cost. During tbs last two years twenty
five bank, financial and large land COM
panies have failesi in these colonies, and
land in every Australian city has shrunk
to less than its mortgage vaine
The aggregate territory, settled and un-
settled. comprisea in the ssx colonies of
Australia, is neat.y as large rs the United
States without Alaska. or 8, fs5iT. $3.50 square
miles. while the population. lisa. l37, is .
fifth less than that of OHIO. The debt
borne by this small population and large
territory is $3.50, s;ss. 90. or third as large
as the Federal, state and city debt Of this
country put together. Ts.is enormous
government debt Is only part of the real
debt of the colon,.s to Great Britain. If
the local debt. the land NOR gsges held in
England, and tie bank deposits from there
be included, as the Inpest:rs' Review an
English journal, pointed ort in April,
1892, the entire dest of Ausxalia . about
g. 25O, 00O. 900, or STOUT 81, SOC to family Of
four persons.
For twenty-five years the Australian
colonies have been borrowing at the rate
Of $50 ,0O0. 900 year on the strength of her
undeveloped resources. She has paid the
interest on her earlier loans from the pro-
ceeds Of her late enes. The hard times in
England has cor PEELED general liquida-
ton. The Baring failure compelled Eng
Rlish investors tc raise usoney ON their
Australian securities. Australia cannot
pay what she has borrowed: hence this
frightful financial collap'e. With this
borrowed Engliso capital she six Austria
liam colonies have built ~. l4l miles of
railroads. dug irrigation casn.Is. improved
their harbors and erected p!;b}ic buildings.
The government owns the railroads and
horse car lines in Australis: but as receipts
are falling of on the AustIslian lines the
governments are hard pisssed to meet
their interest. Tie great collapse began
with the land Mortgage Companies, who
were heavy dealers in :ha Australian
banks. The companies hsye been failing
by the dozen for swo year, past, and the
banks were forces to take sap the land on
which they had lsaned mosaey. indirectly,
through their advances t. the mortgage
companies. Real estate las steadily fall.
len for year; there has seen no sale for
1t and both the tso staples of Australia,
wheat and wool, save also :,a:len.
The bank expansion reca.s the years of
imitation and reckless Yves .ern land specu-
iation which preceded our famous panic Of
1887. In the last zen years;t TIE business of
the Australian banks has almost doubled.
The business Of i'se fourteen largest banks
has increased from $6O2, ;: 0,)l5 in 1882 to
81, 055. S6i 10 in 1s:,2, IN ceuntry with less
population than the state If Ohio. Thu
business OF our national bank system,
loans ana discounts toge;se-, is only four
or five times rs large. 9ke Australian
banks are also feger in number. A sinols
one, the largest IN Austras, the Bank of
New South VALE. holds s!o2 s0o, o32 of de-
posits. or o quarter as riueh as all ths
banks in New York city. AXE commercial
capital of over q. 0Oo. 900 people. These
Australian banks by payiits high interest
on deposits attracted vast sums from En-.
g!ish deposi;ors. In sixteen leading banks
IN Australia, with $500 900 80 of deposits
$50. SOC. 900 is m0aey Deposited by English
ana scotch lev >toFs. lie three banks
winch nave iaitci this f:'oath, with the
Federal Bank of Australia: which fell still
earlier, held So $4,000 II deposits. and
so, lUo,VUu OF tbs IS in E:-itish deposits.
The effect Of these great losses among tho
small investors # Great Bfitsin will hs
sure TO be ultimately felt "a this country,
even as was the shock 10 k1g.ish BANKING
credits under thf great Bs,irt- failure
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