The Wheeling daily intelligencer. [volume] (Wheeling, W. Va.) 1865-1903, 1894-01-22
FINANCIAL REVIEW.
Henry Clews's Weekly Letter on;
the Business Outlook
EFFECT OF The LOAN CIRCULAR
On Wall street-It Strengthened Con-
fdence somewhnt-Regret Among
: Bankers-Mr. CarlisIe's Method Not
Likely to Prove PopuIar--The Inn:
provement in General Business.

r
New York, Jan. s20.-Wall street has
the past week. During the fret half,
the absence Of any action by the govern
| ment for overcoming its financial en-
barrassments had depressing effect
both here and on American securities
at London. The announcement on
Thursday OF loan for. $50, 100000, by
the secretary of the treasury, had some
effect in Strengthening confidence; but
the form and method of the loan we're
to some extent disappointing.
The offering of 5 per cent, ten years.
bond, at a price limit which would keep
the return to the investor within 3 per
cent was regarded as somewhat un-
usual operation. e-facts leading to
government has no existing legal au-
thority for-issuing any other available
form Of obligation; whilst, with the ex-
listing. divisions of2o opinion in Congress
on questions of finance and currency,
the administration deemed holly un-5
certain as to what.sortL of auth orizatlon
it might get from that body, or whether
it could get any auth orization what
ever, or whether Congress would reach
a conclusion within the period required
by the extreme exigencies that now en-
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 fair.
ly construed as legalizingJhe secretary's,
proposals. Not a few are doubtful
whether the amount of the loan-the
gross product of which will be about
SG0 000 On0--wi1l fica to coyer the fin
deficiency the treasury may 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 is not of kind spe-
officially adapted for the use OF banks;
as, had it been the best, the secretary
would have been enabled to make dl,
rect exchange of its issues for the gold
of the banks, which is the one thing
the treasury needs, and with which the
banks could we'll afford to part. This
view is sound one; yet it would seem
that, under the present and prospective
excessively low rates for money, The
banks would find it to their interest to
| invest temporarily liberal portion of
their immense idle funds in bond
Welding per cent and which, with the
recovery of confidence, might yield
some ultimate profit on the principal
Should the banks not be liberal sub
scribers for, the bonds, it will probably
| 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 popular one; though
| that is probably the very thing Mr.. Car:
| Isle intended it tos-be. 1t is narrow
| method of conducting so large an oper-
alton by great government; and what
| Mr. Carlisle may save in the way of
fractional commission he will far more
| than lose through the lower prices like
ly to be offered in the absence of the
ordinary methods of "sending off y
such transaction; to say nothing of
| the loss of ecldt that would attend the
! much larger offers that would be
| brought out through the customary
modes of negotiation.
With these drawbacks, the bond issue
| is to be welcomed as fraught with great
| advantages to financial interests. It
settles'the misgivings about the posi-
| bility of the treasury embarrassments
running into e. grave disturbance of
public confidence. 1t shows to the
! world that the United States treasury
has behind tia ready resource of-credit
which will enable it to procure whatever
amount of gold may be needful for the
protection of its obligations and the,
| maintenance OF the gold basis 1t DEM
| onstrates that, in addition to the 35 -or
40 millions of gold that we are now pro-
ducing 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- peculiarly
strong reinforcement of confidence.
For the stoppage of silver purchases
means that the silver hitherto diverted
to domestic currency uses will hereafter
go into our exports, with the elect of
'correspondingly diminishing the occa-
sion for exporting gold. With an in
crease of the home production of gold,
on the one hand, and of a diminution of
its export, on the other, it is clear that
the United States is destined to increase
its future stock of this metal, whatever
may be the experience OF other coun-
tries.
There are those who entertain some
apprehension that the marketing OF
this fifty~millions of new securities may
interfere with the saleEof other invest
ments now seeking buyers. To some
extent this may be the case. But it is
to be remembered that the fifty millions
of floating capital which is thus to find
q 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,
fifty millions is a small matter for this
great country, or when compared with
the enormous amount of idle funds now
awaiting employment, which the pres
ent unprecedented amount of bank de-
posits is but q very partial expression.
Tho improvement in general business
that set in with the opening of the year
is making very gratifying progress. In
the leading branches of trade, there are
as many buyers mere as is usual ut this
season OF the year. Traders are losing
their late excessive caution, for the
reason that the exhaustion OF their
stocks compels them to buy; and for the
further reason that, as they see no
cause for expecting lover prices, there
is no motive for continuing their late
policy of postponement These signs of
returning activity are encouraging
manufacturers to resume work, and to-
day probably sixty per cent OF the
factories that were idle three weeks ago.
are running on full time. These are
i !.