The morning news. [volume] (Savannah, Ga.) 1887-1900, 1896-12-07
BANKER CLEWs, VIEWS.
The Financial Outlook as Seen From
Wall Street.

New York, Dec. 5.-One of the most
hopeful features Of the situation is the
extreme and yet still growing ease in the
money market. A more complete change
than that which has occurred in respect
to credits within the last four weeks
could not be imagined. From Oct. 81 to
Nov. q, the loans and discounts of the
New York banks increased s17. 900. the
deposits gained $24 200, and the surplus
reserve has risen S14, 100000. The banks
appear to have almost exhausted the SUD-
ply of discountable paper. and the rates
on time loans against collaterals have
fallen to figures which imply that the
banks expect the rate to remain excep-
tionally low for several months to come.
The local rate of interest indeed has fall.
en- below that of London, and with some
very unusual results. Bankers here have
bought sterling export bills, to an amount
estimated high in the millions, in order
to get the advantage of this difference be-
tween the London and New York rates
and in the hope of getting the higher "a te
of exchange which may be expected sixty
to ninety days hence. Virtually, these op-
erations constitute a loan to London.
They prevent the influx of gold here which
would arise if the bills were
sent forward, and they constitute a
means for off-setting the adverse
International balance which usually oe-
ours during the early months of the year,
and, therefore. will either diminish our
exports of gold or bring gold this way in
January or February, according to the
condition of the trade balance. This
movement, though common as between
European countries, is almost without
precedent as between New York and Lon
don; but 1t is wholesome in its effects;
for it prevents a arrangement in the Lon
don money market which could do us no
good, but possibly HARM and 1t saves two
unnecessary large transfers Of gold oven
the Atlantic, first one eastward and then
another in the reverse direction. 1t Is
these operations that account for the cur
rent relatively high ties of exchange and
for the absence Of gold imports under a
trade balance of probably $20,000,000 to $780, !.
100000 in our favor These transactions
Indicate the strength Of our present 6nan.
cial relations with the rest of the world:
and IL is the more remarkable that they
should come as part of the natural pro.
cess of reimbursement growing out of the
late perilous state of our currency condi-
tons.
It is to be hoped that the men who make
policies and laws for the nation will not
jump TO the conclusion that, in this hone
fui commercial feeling, men of business
have forgotten the earnest demand for
sound money which they expressed at the
late election. On the contrary, their COM
mercial anticipatons are largely based
upon the expectation that the new admin
istration will carry to completion the cur
rency reconstruction which was only begun
with the overthrow Of free coinage. They
fully expect an early encouragement to
business by revision OF the tariff that
will develop home industries. But they
are even more insistent that the gold basis
shall be placed upon a broader foundation
than hitherto, that the treasury shall be
protected against a recurrence Of the dan
gers that have beset 1t for the last four
years, and that every dollar Of our cur
rency shall be made convertible into gold
beyond possibility Of failure. This Is what
the world expects from us and what we
owe still more to ourselves, and what the
mercantile community Is not likely 10 for.
get; and 1t would be a great mis- take for
our representatives and senators 10 at
tempt to evade a difficult problem under
the idea that because men % business are
again absorbed in profitable business this
great question can be neglected with impu-
nifty.