The morning news. [volume] (Savannah, Ga.) 1887-1900, 1893-05-29
BANKER CLEWs' VIEWS.
The Financial Outlook as Seen From
Wall Street.

New York, May $50 far as respects
the local machinery of finance, there has
been some improvementof conditions dur
ing the past week, The further large re
cOvery of the surplus reserves shown in
the bank statement of May 20 has had
decidedly assuring effect. 1t meant that,
| from now until the usual fall demand
| for currency for moving the crops, the
reserves are likely TO stand in an unusu-
ally strong position and that, when that
| demand comes, the banks are likely to be
well situated for meeting it. The gen
| eral inference from this is that a reasOna-
BILE probability is established for the
money market maintaining fairly easy
| condition henceforth and for the re-
mainder of the year
This naturally has an assuring effect,
for it favors the probability of holders of
! sound securities being able TO satisfy all
! their borrowing wants on good terms for
/ several months to come. The removal of
| doubt upon this point is an important
| gain; but it is not a cure all. There are
| certain doubtful factors affecting the
| market, such as the caution and disa-
! bility of operators after the late severe
| shock, the tactics of the pessimist traders,
| the outcome in London of the great Aus
tralian failures, the partial depression of
| business at home, and the weak spots
| among class of interior concerns.
Factors like these must have their in
| f1uence upon the stock market and may
be expected to check a speedy recovery of
| prices But il would be an eXaggeratiOn
of their Importance to conclude that they
! legitimately forbid any advance beyond
the present level of values 1t is to be
considered that prices now range but little
above the panic level; that the railroads
are making good earnings and are likely
to continue to do so for some months
| ahead; that the competing supply of new
investments coming upon the market is
far below the average and is likely to re
main so for some time; that, in periods of
low quotations like the present, investors
are apt to exchange bonds and other
investments for railroad stocks which are
relatively cheaper; and that when the
| London market has recovered from its
Australian shock the demand there for
Americans is likely to revive. These
facts constitute an element of reSiliency
which is likely not only to hold transient
downward reactions in check, but also to
exert a steady lifting force upon prices;
and that tendency has been manifest in
the improved tone of the market during
the last half of this week, both abroad
and at home.
The worlds crop prospects have lately
shown an Improvement highly encOur-
aging. In April a general failure of
winter wheat seemed almost inevitable,
with the result of a serious deficiency in
the supply of that staple. Now, in Eng
land and most of the continental countries
the probabilities favor about an average
crop, and even Russia affords promise of a
leap from famine yield to a good average
output. In this country, wheat shows a
recovery from the conditions upon which
a crop of 440, 900, 900 bushels has been pre-
dicted, while spring wheat and corn
planting are promising favOrahly. This
change may not favor interests of the
speculative holders who are now carrying
a large surplus from ourlast years wheat
crop; but that is a small Offset against
the universal benefits arising from cheap
food the world over.
The most depressing circumstance with
which this center has at present to con
tend is found in the state of trade in the
interior. This condition seems to have
originated almost entirely in the late
monetary scare and the attendant col
lapse of the "industrials" 1t has been
preceded by. sound, conservative
and fairly active and profitable condition
of trade The scare suggested by
the large gold exports, the drain
upon the treasury gold reserve, and the
sharp precautions of our local banks, to-
gether caused the eastern and interior
banks to contract their accommodation to
customers, and suddenly the financial sky
California. In this way credit has be-
come suddenly paralyzed in every section;
the weak spots in trade, in financing and
in banking have been roughly probed, and
a large amount of failures have been pre-
cipitated. 1t is safe to say, however,
of these suspensions that, in a large
majority of the cases, they have not
arisen from real insolvency, but from a
sudden and more or less indiscriminate
withdrawal of the usual credit facilities
Considering the severity and the uni
versatility of this contraction of credit, the
wonder is that its effects in the way of
suspensions have not been much more
numerous. This evidence of the sound
ness of the general commercial sit
with those whose incOntinent timidity
in lending has done so much to-
ward producing this condition
of things. There is evidence enough to
show that those fears have exceeded any
real occasion; and the true course, at the
present stage, for the New York banks
to their solvent merchant customers,
is to make their present large
surplus more freely available
The only possible result of diff
ferent policy must be to further aggravate
a situation already made needlesSly severe.
The present discrimination against the
mercantile community at our large
centers may, unless speedily moder-
ated, needlesslys bring many more
to the verge of suspension, The situation
is one that calls for broad and intelli-
gent comprehension of the real condition
of business and a Judgment that under
stands how to protect the lender by pro
tecting the borrower. A little more of
that policy would soon produce a great
change in the tone and condition of bust
ness throughout the country at large.
/ e.,
moderately of good stocks on the down
ward turns.