The record-union., 1895-04-15
THE BANK FAILURE AT FRESNO.


warps the judgment and blinds the
vision. Recently bank failed in Fresno,
and the Examiner, with characteristic
stupidity, declares that the failure is at
San Joaquin Valley Railroad.
Zeal IN every enterprise is commend
able; but the Examiner has thrust its
Shiny stupidity into this railroad build
ing enterprise in way which is disgust
ing the projectors as we'll as nauseatlng
the public. 1t wants the reputation of
having originated the scheme, and it is
engaged in manufacturing evidence
which will justify the assertion later that
| it induced the subscription of every dol
| lar OF stock. BY this it intends to rob
every enterprising citizen who has risked
his money in the venture of his due
need of praise.
On what account is Claus Spreckelsa
with his one million dollars, compared to
the Bohemian cohorts who have bullied
| the public into subscribing? But the
statement of the Examiner that the bank
this millennium breeder is in line with
the mendacity of all other statements
made by it in this relation.
The bank failure at Fresno was due TO
8 very natural cause. The assessed value
of mortgages in Fresno is $40, ,688, ,16S. The
total value of all property is S3l, 100000,
including S2,O0O,0OO allotted by the State
Board of Equalization on account of rail
road assessments. Thus Fresno is mort
gagged for 80 per cent. of the entire prop
erty values of the county. The total
value of the real estate in Fresno County
is S2I ,00O, ,0O0 The entire assessable value
of personal property, including all the
money in Fresno, is S2, ,734.OOO. The rate
of taxation in the county is II per cent.
on S3I 200, 900. The average rate of inter-
est accruing on the mortgages is per
cent. Add the taxes and the rate becomes
81. The aggregate interest accruing on
the mortgage Indebtedness of Fresno
County is S950,000 per annum. Thus the
productive industry of the county pays
practically 81 900, 900 per annum out OF
net profits in interest on mortgages. For
five years there has been a steady de-
crease in the val iue of real estate. Lands
for which $3.50 an acre was offered five
years ago would not bring $3.50 an acre
to-day. The property affected by mort
gage has not paid interest and the mort
cages have constantly accumulated. In
this way interest is compounded. The
mortgagors can neither pay interest nor
, principal, nor yet sell the property.
Banks usually think loan on the yalua-
ton of from 40 TO 60 per cent. of the full
value of the properly gilt-edged security,
When property declines to 80 or 40 pei
cent. of the estimated value at the time
of mortgage the margin is on the wrong
side.
l The simple story of the failure of the
3 bank at Fresno ia clearly deducible from
/ these facts. 1t loaned money, the pay
IUSuL O1 WuICl w % soCb ACO Wy AAANA VI o.
5 on realty which under the test of cultiva
ton has failed to sustain the estimate 0
r its value.
The Walt of land was fearfully over
estimated at Fresno. Tile, banker wh
has accepted the old estimates and ha
sought to secure himself by leaving
safe margin of from so to 90 per cent.
confronted with the fact that the face @
his mortgage exceeds the actual value Q
z the land. The bIundering stupidit.
t which would select Fresno as an illustrs
: ton is but an additional evidence of tn
. lack of information on practical subject
Q in the Examiner Office. For seven year
}. the rate on outgoing products fror
Fresno has been the same as from Sa
II Francisco, Stockton and Sacramento; i
other words, Fresno has paid no locs
s rates whatever on the products OF it
# takes case which of all instances
n might recite is the easiest of refutatioI
d Competition will not certainly place tn
}, local rates of transportation on the prod
o ucts of Fresno at less than nothing.
Il The San Joaquin Valley Road professe
: to be nothing but local road to carry tn
y products of Fresno to q point of waite
Is competition. Since, as stated, the rat
from Fresno to Stockton is already moth
n ing, how will the San Joaquin Vale!
8 Road help that locality? The Examine
o will do well to confine its criticism O
1t railroad matters to the petty old woman
70 scandal relating to the general offices c
,e the company at San Francisco, inspire
RS by discharged employees and jealous
20 minded officials whose influence in tn
y affairs of the corporation is waning. A
y village tattler the Examiner is a nota
rs BILE success. When it attempts a discus
D sion of any economic question it fails TO
y want of breadth of view and general lac
ig of information.
of THE Legislature felt compelled to bea
o. testimony to the stupidity OF very cor
We siderable number of voters, and tt
be- short-sightednes of officials who fit u
m ballot b0OthS This ia fOn,,