The Portland daily press., 1893-09-05
The Panic Of 1887.

81
When the Picayune was born in 1S37..the
great financial panic Of that year was in
full force. 1t was, perhaps, the most
momentous financial crisis in the his
tory of 1.-The: country, save. thai. now in
operation, ssand in. much the same manner
it was the combined result of excessive
speculation and over-trading.
1t will be interesting to take glance
backward to the events of So years ago.
A writer of that period has spoken
graphically of the speculation of the day.
1t was speculation in land. Real estate
was held to be the basis of all wealth,
and people became afflicted with craze
to own land. The poorer classes were all
struggling to get possession of a little OF
could of it, The speculation began with
town lots and ended with rash operations
in wild lands. The ruggedest mountains
and the most impenetrable swamps were
marked off on paper into cities and firms,
and were sought and bought with eager
avidity
The speculative craze pervaded the en-
tire Union and was, in America, repeti-
ton Of the John Law Mississippi Land
Company craze which had prevailed in
France in 1870. Awriter says of the in
f1ation of 1887: The American temper
rushed now to speculation rather than
to toll or venture. 1t did not seem
necessary to create wealth by labor; the
treasures lay ready for whomever should
first reach the doors of the treasure
houses. To make easy the routes to
Ell Dorado of prairies and river bottoms
was the quickest way to wealth" Canals
were. projected; railroad mileage rose
from % in 1880 to /, 1913 in 1886.
K $50 the American people gave them
selves with one consent to an amazing
land speculation" Money poured into
our enterprises from abroad. There was
land craze. Sales of public lands
179 in 1886. Banks sprung up like
mushrooms to furnish money to feed the
craze. The Federal deposits were used
to float more paper with which to buy
land. Cities were planted everywhere
and their lots sold to spectators. Martin
Chuzzlewit's investment in Eden was
only typical of the most of these. The
bank notes were secured by the land
which they had been issued to buy.
The Federal Treasury was flooded with
them. The climax came with Jackson's
order that land should be paid for in
specie.
Then came the crash. It was settlement
day. Everybody wanted money, not
paper rags. The Offering fabric of bub-
BILE credit collapsed ard came tumbling
down about the ears of dazed and panic
stricken people. The thrifty, the pru-
dent, the Industrious then, as now, were
involved in the wreck brought about by
the boomers"
The crash was complicated and aggra-
waited by the legislation which had gone
before There was a surplus of revenue
arising from the sales of government
land and excess of taxation. Instead of
using it to reduce the tax burdens upon
the people, the money, to the amount of
81, 900, 900, in 1886, had been divided out
among the States; while President Jack
son had previously withdrawn the pu bic
money from the national bank and dis
tributed it among other State and private
banks. This diffusion of money among
the people only excited, as it always will,
to speculation. When the crash CAME
struggle ensued for hard money, of
which gold was chiefly in demand, as
there was no silver, save Spanish coins,
in circulation. The country did not re-
cover from the effects of the panic of 1887
for many years, and the recovery was
very gradual Confidence is a plant OF
slow growth and like result may be
predicted of the present financial stress.
= New Orleans Pcayune.