St. Paul daily globe., 1895-02-08
FIGURES OF FAILURES.

Many commercial facts, both curl
Gus and instructive, are revealed in
a recent issue Of Bradstreet's. Sta
tlstlcs are there given of the busi-
ness failures and their causes during
the past year and a number of pre-
ceding years. These statistics are
undoubtedly exhaustive, for they are
based upon reports received from
100000 correspondents through rs. 900
postof1lces and concerning more than
100000 individuals, firms and cor
poratlons holding a distinct place
in the business world"
In general,it appears that over one
tenth of all concerns engaged in bust
ness fail every year. Of these fail
ures, however, but one in ten brings
loss to others than the person fail
ing. The remaining nine are able to
pay all debts, with more or less re-
duction of their original capital.
Within the last five years the num-
Der of commercial concerns in this
country rose from 100000 in 1890 to
100000 in 1898. ALI IOst 100 Lew en-
terprises were launches cTery day,
on an average, during 1891 and 1892.
In other words, about 10000 in the
first and $4,000 in the second of these
years. Only about one-fourth as
many ventures were started in 1898,
in the summer of which year came
the panic. Last year the result of
the financial crash displays itself in
crease in the number of our business
establishments, there is recorded a
falling off of 1900 concerns. At
present, therefore, there is a less
number of persons engaged in busi-
ness in the United States than in any
year since 1891.
The singular regularity in many
statistical items has led philosophers
to conjecture that even the laws of
chance may some day be discovered.
Accordingly we observe that, for a
number of years past, the pro-
portion of failures in this coun-
try and Canada, involving liza
bilities of $4,000 or over, has been
above one-third Of the total failures;
while the failures involving less
than $4,000 are little less than two
thirds of the whole number. Yet
much variation is apparent in the
proportion of failures with very
large liabilities. 1898, of course, eX-
hibits the most painful array of
gigantic catastrophes, no less than
forty-siX failures occurring then
where the debts Of each insolvent
equaled $1,000,000 or more, and
eighty three were failures with a
liability of 100000 or over. If alb
sence of failures was alone to be
considered, 1892 might rank as the
banner year of recent times. There
were then no million-dollar failures,
and only eight half-million bank
rupts. The past year included nine
failures where $1,000,O0O was owing,
and twenty-three with liabilities of
half that amount. On the other
hand, the million-dollar failures in
1891 were fourteen, and in 1890
eighteen; the half-million failures
being forty-eight and forty-nine re-
spectively. From which it would
appear that these two latter years
did not include the halcyon days of
American commerce, as our Repub-
ican friends desire to believe.
The real causes of commercial fail
ures are but dimly appreciated by
the general public. Diligent inves-
tigation discovers that lack of cap
ital is invariably more influential
than any other factor, causing over
one-third of all failures. Even
commercial crisis" induced but 26
per cent Of the failures last year.
and not even as much (22 per cent
in 1S93-when we believed that all
reYerses were the outcome of crisis.
Crisis" is present, however, to
certain extent at all times, causing
II per cent Of failures in 1891, and
10 per cent in 1892. incompetence
is the third most important reason.
One-tenth of the country's failures
is thus accounted for.
Lack of capital, incompetence and