The herald. [microfilm reel] (Los Angeles [Calif.]) 1893-1900, 1895-01-25
MONEY, STOCKS AND BONDS,
Henry Clews ON Silver and
Currency.
The Treasury Gold Reserve Again
Fading Away.
Speculation in Wall Street-Foreign and
Domestic Exchange - General
Financial News.
Los ANGELES, Jan. "a.


Henry Clews, in his weekly financial review
of January 18th, takel pessimistic view OF the
effects of silver legislation in this country and
comments on the prospects OF currency legisla
ton by the present congress, as follows;
The treasury report on foreign com merce for
the cal eIdar year 1891. furnished matter Tor
some transient pc slmlstic comment. The
record shows the eff ct of the foreign,distrust
excited by our silver legislation OF 1890 more
strikingly than the returns OF any Of the three
preceding years during which the sherm IN act
had been in operation. For the two fiscal years
1901 and 1912 combined, the foreign com
mercial movem emit, including that of gold and
silver, showed an excess of exports over i'm
ports amounting to $3.50, 100000, or an aver
age per year of $165,O0o.0 Taking the
amount needed for payments of interest and
dividends at the usually estimated sum of
100000. 900 per year, it follows that the bal
ance OF S65, 900, 900 went TO pay for returned
securities or to settle Withdrawn credits. For
the past year, we had net trade balance OF
S1e1, 900, 900 in our favor and yet made q net
export OF Did amounting to $S1, 900, 600, leav-
ing 1862, 900, 600 to be accounted TO. Assum-
Ing 800, 000, 600 of that sum to have gone in
the payment OF dividends and int ,rest, the
remaining $152,000,O00 will represent our
ilduludblOus vi NdElOus iOIlus VI lOItls
eial Indebtedness, such as securities sent home,
real estate mortgages, banking and other run
ming balances, the owners OF which preferred
to withdraw from use here With the forego-
ing figures covering three andsa half years, it is
easy to see how, during the four and half
years for which the silver act oil 1890 has been
in operation we may have bsen driven into the
liquidation of fully 1850 600 900 of the prin-
cipal of our various forms of dsbt to foreign
countries.
There can be little question about the cause
of these immense Withdrawals of capital to
Europe. In the main, it signifies that our for
eign creditors have become distrustful of our
ability to save ourselves from drifting upon the
silver basis, The fear is not so much about the
possibility of our taking care of such silver
money as we at present have, 1t is that the sill
yer faction, which has shown it's ability to
force on the country already $500,000 900 of
what are virtually so cent dollars, and that 1t
may still retain TO CO enough to yet further in
crease those issues indefinitely; and they say
that we have no satisfactory assurances to the
contrary to advance-but hopeI only which, 1t
is claimed, find little b4cking in the present
phases OF federal politics. In all this there is
great deal OF exaggeration of the worst features
of our case, and perhaps little disposition to
give due credit for the certainty with which we
always COIECSb out pluhuStst Dut
the fact nevertheless Is that our critics choose
to take their own view of the matter, and their
opinions can be changed only by some sort of
conclusive demonstration that no further is
sues of silver money in the United States are
possible.
The prospects OF currency legislation by the
present congress are fast vanishing, II they
have not wholly disappeared: Any general
scheme for dealing with bank circulation be-
comes more impossible of hurried realization
as diversities OF opinion develop. Time must
be allowed for the comparison and maturing of
views; and sentiment seems to be drifting in
favor of the appointment of a national com.
mission of eminent experts, who shall hear
witnesses and report conclusions at the next
Sc sion of congress. There is much to be said
In favor of sucfta course, especially as con-
gressmen are imperfectly iuformeiMon the
question, and AS this; IN ethod of treatment
might develop the mature Judgment of those
best qualified to coua sel b,ttsr than any other.
But the deranged condition of the treasury
finances and especially of the gold reserve is a
separate matter, which will not admit of any
such postponement, A m easure providing in
the t; rst place for deficiencies of revenue, and
in the next for fixed gold income, imper alive
ly needs to be enacted at the pending session of
congress, and it is hardly conceivable that the
administration Will fail to urge the adoption
of law to that effect at an early day. That
being accomplished, the more acute and urgent
difficulties will be overcome, and the question
of retiring the legal tenders and filing their
places with bank notes can be well allowed to
stand over for year without any immediate
serious Inconvenience That is in the nature
of a general currency measure: whilst the
treasury problem is the much narrower one of
re-establishing recent departures from the GUS
tomary usages of making payments to the gov
eminent in gold or gold cert hcates.