The Saint Paul globe. (St. Paul, Minn.) 1896-1905, 1896-08-31
Ratio of

This comparison is far less unfavor-
able to the present condition than
might be inferred from the tone of
feeling with which it is regarded. In
six out Of the last twelve years, the
surplus in the second half of August
has been less than $4,000, 900; and, in
five of the dozen years, the ratio of
reserve to deposits was lower than it
is now. Indeed, the present reserve
is not sufficiently below the normal
limit to warrant any serious appre-
hension for the future of the money
market. The years when the figures
were notably higher than now were
periods Of unhealthy redundance fol-
lowing collapses; as for instance in
1894 and 1895, which reflected the re-
dundancy following the panic of 1893;
and in 1884 and 1885, which presented
an accumulation of currency arising
from the crisis in the spring of 1884
This fall money movement is always
largely Self-regulative. 1t is an al
most invariable rule that foreign gold
comes in to take the place in the banks
of the paper sent to the interior The
European payments for our new crops
of grain and cotton turn the exchanges
in our favor and gold comes in more
freely than at any other season of the
year. And, if the pressure of the home
money market becomes acute, it is
found easy to get relief through issues
of siXty-days foreign bills against de-
post of collateral. 1t thus turns out
that, in four years out of five, the
Withdrawal of legal tenders to the in
terror is compensated by the receipt
of gold from abroad.
There is no reason for expecting that
this rule will fail us during the present
autumn. Last week, it was shown in
these advices how largely the exports
of produce have been exceeding the
imports of merchandise. and we then
suggested the probability that gold
would soon come hither from abroad.
Our words scarcely got into print be-
fore it became known that foreign en-
gagements had been made for the ship
nlent of 81, 000,0 00 since increased to
$4,000, 900. 1t may be safely expected
that large further relief will come from
this source; and should that not suffice,
any large difference between the rate
of interest here and in London would
bring us temporary advances through
foreign bankers, sufficient to stave off
any really embarrassing stringency
The worst feature in the situation is
the fact that the feverish temper into
which the financial markets have fallen
causes every obstacle to be unduly
magnified in the public imagination;
and the money market is now suffering
from that sort of exaggerated appre-
tension.
The New York bank managers have
again shown their sagacity in their
action in preparing for the issuance of
Clearing House certificates. They do
ii. however. to ward off danger on the
principle that an ounce of prevention
is better than a pound of cure. 1t is
to the credit of a large and strong
bank to have taken the initiative in
this matter as was done by the same
bank in 1898, for the purpose as it
were, of breaking the ice for the
benefit of others. The needs for
money at the present time are not for
Wall street, but for the benefit Of the
mercantile interests and for crop
moving purposes. The banks there
fore do well in preparing themselves
for such legitimate money require
ments.
1t is not to be overlooked that.
owing to the general contraction of
business, the borrowing wants of
merchants and industrialists are very
moderate; fact which is clear from
the loans and discounts of the Clear
ing House being $48. 900 900 less than
they were a year ago. Stock exchange
wants have also been reduced to a very
low scale, partly owing to the very
small amount of stock afloat on the
market and partly from the extremely
low range of prices. For the pur-
pose of illustrating the latter point
and also as affording an exhibition of
the disastrous effects of the silver agi-
tatiGn upon the value of corporate
investments, the lowest recent prices
OF stocks In comparison with those of
year ago, are here presented