The record-union., 1899-07-25
The Financial Cloud 0vershadaW,ng
the British Capital Lifts.
Dealers With Credit Now See No Reason
for a Change In the Bank Rates.
Trouble May, However, Only BE
Temporarily Postponed, the Sit
uation ON the Continent Being
Precarious Spain's Pecuniary
Affairs Going From Bad to
Worse.

Affairs Going From Bad to
Worse.
NEW YORK, July 24.-The London
financial correspondent of the Times
cables:
The cloud has lifted from the money
market as swiftly as it arose. On We'd
nesday an easier tendency first began
to display itself and dealers with credit
began to think that the bank rates need
not necessarily be changed. No change
was made, and the weekly bank state
ment indicated that the absorption Of
gold and notes in circulation had pass
ed, II not come to an end. More i'm
portant still, the figures proved the
stringency to be artificial and the pro-
duce of the banks own action. To
make money scarce in the open market
1T has borrowed more than it lent2
either that or it has sold sticks for
cash. Instantly the market fell at
ease with itself again and rate-cuttingt
was suspended. Early in the week.
the bill brokers stood out against the
market and refused to buy bills under
32s per cent. On Thursday they. did
small business at 3b per cent, .oc-
REASONABLY less, and yesterday the rate
was about 3K per cent. and threatened
to go below 3 per cent. this week. At
the same time money has fallen to
and 2l2 per cent.
These wobblings are unpleasant, and
| everybody is inquiring why the bank
was seized with such alarm producing
energy. The explanation is simple
enough. Had the bank not acted as it
has done, gold would have been ex-
ported and we should have seen a per
cent. rate established before we could
get it back again. By cornering the
market at once, the bank forced rates
up, turned exchange in our favor and
drew gold from the continent. So po-
tent has been its influence that the
Bank of Amsterdam has been obliged
by swift successive steps to raise it's
own rate from 21a to AZ per cent. in
| order, to protect it's bullion.
/ Trouble has perhaps only been post
poned because the situation on the con-
tinent is still precarious, but domestic
ally all seems trim and stable.
secondary cause of the banks ac-
tion is to be found in the evil reports
which have been circulating about the
stability of the Birkbeck Building So
SiCty. LII Lie COuISc VI years lDlS III
stitution has developed large business
as deposit bank and now holds about
f10,000.000 OF money, all repayable on
demand, besides a million sunk in brick
and mortar By allowing too liberal
interest to depositors, it's management
has been driven to invest in many Sc
curities of speculative character. To
relieve it of some of these it years ago
created two trusts, each with f500, 900
capital, but this was not enough and q
fortnight ago a run began, threaten
ing to pull it down. Happily the Birk-
beck possesses some millions of good
securities and was able to find means
to pay. The danger, therefore, is now
over, but reorganization must follow.
Had this concern stopped payment, the
consequences must have been most Ia
mentable for deposit-making banks in
general, and for thousands of humble
persons. The Bank of England there
fore, did well to act energetically to
bring in gold.
Abroad affairs have not appreciably
mended. The Paris Bourse is over
loaded and lethargic. Berlin and
Frankfort are in the same condition
and stringency with ugly suspensions
dreaded for the autumn. Perhaps the
fear may work it's remedy without cri-
sis, but the situation is precarious. In
Norway the great wood pulp industry
is paralyzed by the Christopherson
failure, which hits German bankers Sc
verely, his liabilities being nearly
100000 with assets doubtful, as his
business was kept floating by accom-
mediation bills.
Spain falls from bad to worse. Re-
trenchments cannot be enforced by its
feeble Government and the people are
determined to refuse the payment Of
the new taxes.
The Roumanian harvest is a disas-
trous failure but the Russian shortage
is declared less than earlier estimates.
Still all the world wants money and
three parts of it cannot get more. Our
own moneyed classes speculations are
terribly locked up and are consequent
ly unable at present to operate freely
even in American rails whose bright
prospects are now daily set before them
in glowing colors. AS for copper shares,
the public interest in the gamble is at
zero.
The appointment of Clinton Dawkins
to be senior London partner of the
Morgans is generally approved here.
His career beats romance, but all say
his success is eminently deserved.