The Louisiana Democrat. [volume] (Alexandria, La.) 1845-1918, 1895-06-26
OVER THE DEAD CENTER.
New York Incident OF the Financial
Squeeze Of 1903.


Squeeze Of 1903.
Right in the midst of the panic OF
1898 q tinancier and great power
in the world of trade whose name is
known all over this country and Eu-
rope went to friend and said, Il
am 50 near ruin as this--that while
have millions in securities have
scarcely 81, 900 in cash and must
have s25, 900 today, or l am done
for.
He had thrown himself languidly
into a chair as though almost ready
to give up the battle. He knew we'll
enough what the announcement of
his failure meant for the commercial
world 1t probably would have pull
ed down score or moro of impor-
tant institutions and very likely
would have preoipitated general dis
aster. He had been everywhere with
securities in his pocket valued at
hundreds of thousands of dollars
pronounced good then, but he was
told in every place, Your securities
are good, but we cannot lend money
now His position was like that of
the castaway upon the ocean with
water, water everywhere, nor any
drop to drink" His securities at
their normal value were probably
worth as much as $4,000, 600, per-
haps moro, but it was impossible for
him to borrow SO upon them.
The friend to whom he went knew
as we'll as he what his failure in
volved; knew that he was worth at
least 100000 in securities, al
though he could not command the
s25, 900 which stood between him
and the protesting of his paper.
The friend said: well, I'll try to
help you What collateral have you
got?" He took from his pocket So
ourities which before the panic
would have commanded easily $780,
600 and said, II can offer these"
"They are good" said the friend,
nothing better. Let me sec what
I can do.
He went out to q financial institu-
ton Of which he had long been a
customer, and he said to the officers:
II want to borrow S25, 900 on this
collateral, which is worth $4,000
/ will guarantee the paper, provided
| havo recourse to the collateral in
case it is not paid. "
But, said the bank officers, I'VE
can't lend that. The collateral is
good enough, but we car 'teven lend
ON government bonds. Nobody is
lending. Everybody is trying to Dor
row."
well, said the friend, then I
will submit proposition to you. If
you will lend the money on this COL
lateral, 1t will earn 6 per cent for
you. If you will not lend it, then I
will draw my own check upon this
concern for s25, 900, and I will keep
the collateral myself. Now, 1t is for
you to say whether for the s25, 600
that you've got to part with you
will take security and s per cent in
terest, or whether you will pay it
out and get nothing for it, as you
must do if I check it out. -
Of course the officers, confronted
with such en- alternative, could only
decide to loan the money, and it was
the biggest loan that was made that
day or perhaps for several days be-
fore or afterWard--at least the big
gest new loan.
The friend went back to the CAPT.
talist and said, 1.-The s25, 900 is at
your command When the capital
list heard this, he becamea new man.
All the energy characteristic Of him
returned. Said he, THAT will carry
me over the dead center, for l am
satisfied that before any of my other
obligations mature it will be posi-
bic to borrow money on such securi-
ties as l possess, and that proved to
DO the case.
The capitalist is now esteemed to
be worth not far from $40, 900, 900,
and he can borrow upon his securi-
ties millions of money with perfect
ease. He does not like to think OF
the day in 1893 when S25, 900 stood
between him and ruin. Holland in
Philadelphia Press