The Salt Lake herald. [volume] (Salt Lake City [Utah]) 1870-1909, 1899-12-27
Present Stringency Is Caused By
Stock Speculations.
DIRECTOR ROBERTS VIEWS
LEGITIMATE TRADE Is IN NO
WAY RESPONSIBLE.
Any Possible Supply of Cash Could
Not Prevent Stock Exchange Pam
les or. Periods of Money String
ency-New Supply Simply Stimu-
lates the Demand-Plenty of Gold.

director OF the mint, was asked today
as to whether the present monetary
stringency. in his opinion, signified an
actual scarcity of money to meet the
present requirements of trade. He said:
No possible supply Of money can
prevent stock exchange panics or per-
iods of monetary stringency. because
speculation and rising prices will alb
serb any possible increase until the
pressure for ready cash is just as great
upon the new plane as twas upon the
old. The cry for more money is as un-
appeasable as the demand for more
wealth. A new supply instead of de-
n1and stimulates il. Men want money
TO buy things with-good things that
they think are going higher. Given
easy money in the banks, and we have
bankers encouraging borrowers. AS a
result, stocks go up, and as they go
up more. people want to buy and so
the demand for money increases. You
cannot furnish money fast enough to
meet the demand of all who would like
to borrow while prices are going up,
nor could all the gold and silver mines
in the. world together keep prices going
up forever.
"A marvellous era of increasing
money stocks began in 1850, and started
a period of speculation and ended in a
world smash in 1851, when even
the Bank of England had to suspend
payment. without any decline in pro-
duction. and with the minis everywhere
open to both gold and silver.
Speculation on Margins.
''The real secret of these reactions is
in speculation on margins Those peo-
pie who are crying that they have been
forced to throw away their property
had never paid for their holdings. They
borrowed money on call to make small
payments, hoping that right turn in
the market would give large profits.
But in that class of oparations losses
come as easily as profits. That is one
of the conditions of the game. When
they have profits they call it prosper
ity, but when they have losses they
think the country has come to stand
still and want to know who is to
blame. Nothing has happened except
that they have been asked to pay what
they owe. 1t is impossible to do away
with such speculation by any increase
in the money supply.
In short, it is not legitimate business
that causes the enormous imitation of
credits. multiplies the bank reserves
required, and thus absorbs any possible
money stock. Speculation greed will
IT,, ana as IL rs obviously
impossible to satisfy that appetite, it
is absurd to point 20 a tight money
market rs a proof of an insufficient
supply Of money. -
War In the Transvaal
'Undoubte ", TIE war insthe Trans.
yaal has had influence uponaour money
market. Anything that disturbs normal
conditions, which turns the currents of
business out of the course they have
been expected to follow, will affect
business. With, trade balances as they
are, our bankers early in the season
had reason to expect gold imports this
fall and probably directed. their bust
ress accordingly The war has not
only cut off a remit OF about 10000
a week to London from South Africa,
but compelled heavy shipments the
other waJ.
Such a reversal Of the regular and
order makes money tight |
in all centers until affairs are readjust-
ed TO the new condition. The world |
does not depend upon the Transyaal |
for its stock of gold. Colorado will J
produce more gold in 1900 than all |
North America yielded ten years ago.
and this continent will yield more next |
years ago. Cripple Creek is UP to the !
record of the Transvaal five yenrs ago, |
and Cripple Creek, with Alaska and |
the Klondike, viii next year exceed the /
Transvaal production of 1897. The gol-
len tide, though checked for moment,
is not going to subside."