The herald., 1896-02-14
HENRY CLEWS' LETTER


While the contamination OF the $lOO,-
600, 900 loan was hailed In Wall street az
o remarkable success and in the highest
degree encouraging to the financial out
look, vet 1t has thus far met with no COM
mensurate response in either the course OF
prices or the tone of the market. As iS
very usual in such cases, the effect had
been partially anticipated. For several
days previous, when the success OF the
loan had become assured, certain promi-
nent operators became liberal buyers OF
stocks and promoted quite q considerable
rise in the Granger and other leading
shares. When the news of the $6OO,OOO.-
900 of offers came, these parties rushed
their holdings on the market, and their
realizing prevented the rise in prices that
would otherwise have occurred. At the
same time, for some unexplained reason,
London became quite free seller which,
more than the selling of the traders refer.
red to, helped to check the rising aruor Oh
the exchange.
1t would be great misrepresentation to
construe this absence of demonstration
over the success of the loan as meaning
that little account is taken OF it's great
financial Significance. On the contrary
Wall street is deeply impressed WIN ts
value as a new uplifting element in the
general situation, and the feeling is general
that its real effects have yet to come. At
one stroke it puts the whole investment
interest of the country upon higher
status. 1t exhibits vast unemployed
home source of investment that had not
heen supposed to exist. 1t reveals us in a
position of resource which we had not
credited ourselves with having attained
namely that of people with vast accumu-
lations of capital ready to be loaned for
long periods at low rates of interest. What
Europe has been to us, as source for pro-
curing the means for internal develop
ment, we now find we have become our
selves. This uplifting of the veil reveals
to us the United States emancipated from
dependence upon future foreign lending,
and capable of framing it's destinies from
it's own capitalistic power. go.
The phenomenon of six hundred millions
offered for investment is full or hopeful
suggestions. 1t shows that-in spite OF the
silver heresy, the bad condition of the cur
rency, the difficulty of maintaining the
gold reserve and the depravity of congress
eional politics-the men of brains and OF
material success have unshaken confidence
in the resources of the nation and in our
ability to utilize them for the development
of the country's wealth. 1t is evidence
that the embarrassmen:s of the moment
are not expected 20 extend their effects
permanently into the future. Men OF ex-
perience and sagacity know what to ex-
pect from our people. They know with
what tenacity they cling to misconceptions
and sometimes to plainly dangerous err
ors; but they also have learnt to put conti-
dence in their last conclusions; though
occasionally it may take long time 10
reach that final verdict. For that reason,
they do not regard the present condition of
the treasury reserve as making the pres
ent state of the public credit really
dangerous; but they view the present
clumsy and costly method of sup
porting it as but precedent to the
finances being placed upon sure founda-
ton. 1t is therefore not surprising that our
men of means are forthcoming with $600,-
100000 for the service of the government
at O time when so many conditions look
threatening. This is about the matter of
fact way in which the men of Wall street
look at the results of the loan and the pres
ent financial situation. The leaders of the
financial markets are not now halting so
much on account of any really serious dis
trust about the future as because of the ef-
feet of present conditions upon the general
public, which up to the present time has
been paralyzed by apprehension. AS to
that very important class, the present idea
have the effect of inspiring them with new
hope and with fresh confidence; and
upon that expectation Wall street is en-.
couraged to hope for a revival of invest
ment and return to speculative opera
tions.
There has been no idea that any such
amount of capital was lying around unem-
ployed as the bids for the loan have re-
veaied. 1t is argued that, when confidence
is measurably restored las it should be I'm
der the twelve months protection of the
reserve now securely, O portion of this six
hundred millions of funds will be found
available for the fostering of new corporate
enterprises; and the reasoning appears to
be we'll founded.
1t is understood that an important sum
of the loan goes to the German Reichsbank
and that other sums have been awarded to
representatives of Continental investors.
These engagements place 30 much to our
credit in Europe and will have an easing
effect upon the foreign exchanges, which,
according to current symptoms. do not
seem likely to give us much inconvenience
for the next few months. Thus the condi-
tions affecting Wall street interests and
the general business of the country have
entered upon a new and entirely more
hopeful phase, and the current year should
show more prosperous results than were
realized in 1895.
The immense demonstration OF the
American people in bidding for the United
States bond loan was largely inspired by
the recent majority action of the senate in
obstructing all necessary legislation SIM
ply for the purpose of carrying through
their regulatory silver scheme. The ma
jority of the people who subscribed for the
bonds did it to sustain the government
credit as against the attack of factious
senate. The result of the bond success
will be to lay out the silver senators and
eventually send them to their political
graves. The passage of the silver bill
through the senate, just on the eve of the
aud vicious legislative act ever put on
record. 1t was simply monstrous. The
effect of so brilliant success of the loan
will be magnetic, both at home and abroad.
1t insures the credit of the government on
the basis of the worlds best money. 1t
will give confidence to everybody in trade
circles. 1t will be the signal for new Wig
orous departure with everybody con-
nected with commercial enterprise, and a
return of confidence in every channel of
business. 1t will change the competition n
in the stock market to the buying side in
place of, as heretofore, the selling side.
This will especially apply to European
dealings in our securities. We are in for a
steady bull movement of important di-
mensions and for q prolonged period.
Washington legislators have now done
their worst and will not be feared here
after. 1t, therefore, will be of little conse-
queuce what measures may be passed by
the senate hurtful to business interests, as
full confidence is felt in the loyalty and
wisdom of the house to checkmate their
rade" actions of the senate will pass for
naught in the future. HENRY CLEws.
Charged With Petty Larceny