The midland journal. (Rising Sun, Md.) 1885-1947, 1894-06-08
Friday, June 8, 1894.
The Business Situation.

The Business Situation.
We hear some very gloomy reports here
about the business outlook, and some OF
our bank presidents are expressing what
are really most pessimistic views as to the
immediate future. Nobody looks tor
another financial panic such as we had
last year, but there seems to be appre-
hension that there may come CONNER
cial panic unless the conditions are either
speedily changed or unless there is prom
Use of better things at an early day.
Merchants are finding that their stocks
on hand are depreciating in value. They
have been struggling along in the hope
of Improvement The president of one of
the largest banks in this city said this
morning "Some of our merchants tell
me that they find their stock has depre-
ciated as much as rs per cent; that for a
firm with capital of 81, 900, 900 means
$3.50, 900, a depreciation which, if contin-
tinued, can only involve bankruptcy.
'The question is. how long can these
merchants hold on? 1t is not a matter of
the banks carrying them any longer.
The public would be surprised if it knew
how many of our mercantile houses have
been carried for the past year by the
banks. The danger is that one of these
days some one of the greater houses will
let go, believing that it would be better
to face liquidation at once than to strug-
gle any longer, and the collapse of one
great house might bring on so many
bankruptcies as to plunge us into COM
mercial panic"
The above paragraphs are from one of
Hollands" New York letters to the
Philadelphia Press. This is what the
reform papers pointed out two years ago,
was sure to happen, and were denounced
by this same class of newspaper writers as
calamity howlers," prophets of evil
omen," "alarmists, ignoramists, /" etc.
Now they are beginning to break the
unwelcome news to their readers, whom
they fooled as long as possible, in a
gingerly way. OF course the danger" is
a foregone conclusion. These merchants
whom the banks are carrying, with heavy
stocks of unpaid for goods and falling
prices, are bound to break, and carry
down hundreds of other smaller concerns.
The "panic" has been going steadily on
for ten years. Last year the banks and
President Cleveland brought on a sharp
squeeze as an "object lesson;" Cleveland
said it was necessary for the people to see
that Congress would be forced to repeal
the Sherman law. They called this
sharp contraction "the panic" but it
was only more vigorous push, i'll order
to create a sensation for special purpose.
Holland" in the same letter continues:
We hear in view of this sensation good
deal of talk about the financial policy of
the Government. Mr.. A. Foster Higgins,
prominent member of the Chamber of
Commerce, speaking of this condition,
said today that he had but little hope of
any relief through proposed international
agreement respecting the use of silver.
Said he: 81 have about made up my mind
that the system suggested by that able
inancier who was twice Secretary of the
Treasury, the late William Window,
affords a rational, safe and simple
financial policy standing upon which the
United States could be independent of the
world Mr. Window had made the sug-
gestion that there be legal tender cur
rency issued by the Government convert
ible into United States bonds bearing a
low rate of interest, and coming from so
wise fnarcier and one who did such
brilliant things as he did, it seems to me
that his suggestion deserves most earnest
consideration at this time. incidentally
these bonds would free the national bank
ing system of the embarrassment which is
soon to arise through the extinction of
the Government debt, and the currency
thus provided would be elastic'
This is pure greenback financial sys-
tenn, and in brief is the issue of legal
tender notes by the government to supply
the demand for currency as long as that
demand continues and when plethora
of currency is in circulation a funding
system is provided by an exchange of
bonds bearing one, one and half or two
per cent interest. This bond issue is for
the purpose of contracting the circulating
medium, when the volume of business
Stacks up, and parties having money
which they could not use for the time
being would exchange it for these bonds.
When fresh demand for money arises
the holders of the bonds would exchange
them at the Treasury or one of its
branches for currency.
If the business men of the country do
not cut loose from the European Jew gold
ring by advocating some such indepen-
dent financial plan, precious few of them
will ere long have but few remnants to
save.
This inter-convertible bond plan was
worked out in all its details by Mr. John
NJ. Bachelor, and published in the New
York Financier, before it was suggested
by Secretary Window. No such system
will ever be adopted as long as the people
send men to Congress to the
Senate-that the London gold ring can
control What they dictate through their
Wall street agents the present Congress
and all previous Congresses for 30 years
have adopted.
New ZeaIand's PrOSnerifv