The morning news. [volume] (Savannah, Ga.) 1887-1900, 1894-01-22
BANKER cLEws' VIEWS.
The Financial Outlook as Seen From
Wall Street


New York, Jan. 20.-Wall street has re-
manned comparatively lifeless through the
past week. During the first half. the alb
sence of any action by the government for
overcoming its financial embarrassments
had depressing effect both here and on
American securities at London. The an
nouncement on Thursday of a loan for
$50, 900, 600, by the Secretary Of the
Treasury, had some effect ia strengthen
ing confidence; but the form and method
of the loan were to some extent disap-
pointing.
The offering of 5 per cent. ten years
bond, at price limit which would keep
the return to the investor within per
cent, was regarded as a somewhat un-
usual operation The facts leading to that
course seem to have been that the govern
ment has no existing legal authority for
| issuing any other availa BILE form Of obi
| cation: whilst, with the existing divi-
sions of opinion in congress on questions
of finance and currency the adminisJra-
tion deemed it wholly uncertain as to
what sort of authorization it might get
from that body, or whether it could get
| any authorization whatever, or whether
congress would reach conclusion
within the period required by
| the extreme exigencies that NOW embar-
rass the treasury. Under these circum-
stances, the administration appears to
have felt itself driven to use an old au-
| thorization granted under other circum-
stances, but which may perhaps be fairly
| construed as legaliZing the secretary's
whether the amount of the loan-the gross
product of which will be about $50, 900 900
| will suffice to cover the full deficiency
the treasury will have to meet but it is
| TO be presumed that. in such event, any
further required issue could be made.
Regret is expressed in banking circles
that the obligation to be issued is not of a
kind specifically adapted for the use Of
banks as, had it been the best, the sec
Rotary would have been enabled to make
direct exchange of its issues for the
gold of the banks, which is the one thing
| the treasury needs, and with which the
banks could ewell afford to part. This
view is a sound one; and yet il would
seem that under the present and pros
pective excessively low rates for money,
the banks would find it to their interest
to invest temporarily liberal portion of
their immense idle funds in a BOND yield
| ing 3 per cent, and which, with the re
covery of confidence, might yield some
ultimate profit on the principal.
| Should the banks not be liberal
subscribers for the bonds, it will proba-
! bly, be for other reasons than because 1t
would not pay them to subscribe The
method of issuing the loan is not likely to
| prove to be a popular one; though that is
! probably the very thing Mr. Carlisle in
| tended it to be. 1t is narrow method Of
| conducting so large an operation by a
! great government; and what Mr.. Carlisle
may save in the way of fractional com
mission ne will far more than lose through
| the lower prices likely to be offered in the
absence of the ordinary methods of "send-
! ing OFF, such a transaction; to say moth
| ing of the loss of eclat that would attend
/ the much larger offers that would be
| brought out through the customary modes
of negotiation.
! With these draw backs, the bond issue
| is to be welcomed as fraught with great
| advantages to financial interests. IL set
ties the misgivings about the possibility
of the treasury embarrassments running
| into grave disturbance of public conf
! dence. it shows to the world that the
! United States treasury has behind it
| ready resource of credit which will en-
| able it to procure whatever amount of
| gold may be needful for the protection Of
| its obligations and the maintenance of the
! gold basis. 1t demonstrates that, in addi-
tion't to the IS, 100000 or 40,000000 of gold
that we are now producing annually, we
/ have an ability to borrow gold
| which no other country can boast
Of Taken in connection with the repeal
of the Sherman act, these assurances
/ amount TO a peculiarly SbTOng REINFORCE
ment of confidence For the stoppage Of
silver purchases means that the silver
! heretofore diverted to domestic currency
uses will hereafter go into our exports,
with the effect of correspondingly di-
minishing the occasion for exporting gold.
With an Increase of the home production
of gold, on the one hand, and of a dimi-
mutton of its export. on the other, it is
clear that the United States is destined
| to increase it's future stock Of this metal,
whatever may be the experience of other
countries.
There are those who entertain some APP
prehension that the marketing Of this
! $50 ,00O, 600 of new securities may interfere
with the sale of other investments now
seeking buyers. To some extent this may
be the case. But it is to be remembered
that the $500 900 Of floating capital
which is thus to find a ten years resting
place will IN turn largely find its way into
other hands TO seek some other form of
employment; and it is also TO be kept in
mind that $50, 900 is a small matter for
this great country, or when compared
with the enormous amount Of idle funds
now awaiting employment, which the
present unprecedented amount Of bank
deposits is but a very partial expression.
The improvement in general business
that set in with the opening of the year is