The Saint Paul globe. (St. Paul, Minn.) 1896-1905, 1899-12-27

w ASH AHeAr MHFS1HS w ere wiped
Out They Claimed That Some
thing Was Wrong in Financial
situatiOn-Over-Spec En-
dangers All Branches of Business
Worldwide Panic of 1857 Cited.
WASHINGTON, Dec 26.-Nr Roberts,
the director of the mint, was asked today
as to whether the present monetary strin-
gency in his opinion, signified an actual
scarcity Of money to meet the present re-
quirements of trade. He said:
No possible supply of money can pre-
vent stock exchange panics or periods of
monetary stringency, because speculation
and rising prices will absorb any possible
increase untif the pressure for ready cash
ends. The cry for more money is as un-
appeasabie as the demand for more
wealth. A new supply, instead of salts
flying the demand, stimulates it. Men
want money to buy things with-good
things that they think are going higher.
Given easier money in the banks and we
have bankers encOurag ging borrowers. AS
a result, stocks go up, and as they go up
more people want to buy, and so the de-
mand for money increases You can't
furnish money fast enough to meet the
demand of all who would like to borrow
while prices are going up, nor could all
the geld and silN er mines in the world to-
gether keep prices going up forever.
WORLDWIDE SMASH.
"a marvellous era of increasing money
stocks began in 1850, and started a period
Of
worldwide smash in 1857, when even the
Bank OF England had to suspend pay
ment, without any decline in production,
and with the mints everywhere open to
both gold and silver. The real secret of
these reactions is in speculation on mar
gins. These people, 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 a
right turn in the market-would give large
profits. But in that class of operations
losses come as easily as profits. That is
| one of the conditions of the game. When
! they have profits they call it property
| but when they have losses they think
! the country has come to a standstill and
want to know who is to blame. Nothing.
asked to pay what they owe. 1t is i'm
possible to do away with such speculation
by any increase in the money supply.
If stock selling at 500 per share has
an advance of So the investor, ,A~ho owns
it outright, makes 10 per cent, while the
speculator, who has only n margin of
SO, makes 100 per cent. That is the secret
Of marginal trading.
NOT LEGITIMATE BUSINESS.
''In short, it is not legitimate business
that causes the enormous imitation of
credits, multiphes the bank reserves re-
Quired, and thus absorbs any possible
money stock. ecuation-greed-wiIl in
evitably 10 it, and as it is obviously i'm
possible TO satisfy that appetitRit is alb
Surd to point to a tight money market
as proof Of insufficient supply of money.
Undoubtedly the war in the Transvaal
has had an influence upon our 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 proba-
! bly, directed their business accordingly.
! The war has not only cut off a remit
! tance of about $1,000, 900 per week to Lon
/ don from South Africa, but compelled
/ neaVy shipments the other way. Such a
reversal Of the regular and accepted order
of things makes money scarce in all cen
ters, until affairs are readjusted ed to the
new condition.
THE world does not depend upon the
/ Transvaal for It's stock of gold. Colorado
Will produce more gold in 1900 than all
] North America yielded five years ago
end this continent will yield more next
year than the whole world did ten years
ago. Cripple Creek IS Up to the record
of the Transvaal five years ago, and Grip
| pie Creek, with Alaska and the Klondike
will next year exceed the Transvaal pro-
duetion of 1897 The golden tide, though
checked for the mcment, is not going to
| subSide."