The Anaconda standard. [volume] (Anaconda, Mont.) 1889-1970, 1899-12-19

to borrow anywhere from $4,000, 900 to
S20,000000 in gold from the Bank Of
France, as was done at the time of the
Barring crisis and in earlier seasons of
distress.
Nor does it now seem to be questioned
by any reputable financial authority
that the basic cause of the trouble is
the stoppage of the gold supply from
South Africa. When the Boer war be-
gan, many of the leading trade and
financial journals labored hard to
make it appear that the reduced eX-
ports of gold from the Transvaal mines
would have no effect upon business.
could be no serious effect, because even
without the gold from that source the
worlds product was so much greater
than it was a few years ago.
This reasoning was perhaps, sincere,
but If so, it was enough to make the
ghost Of John Stuart Mill walk in sheer
disgust. comparison of the gold
product now with that Of ten years ago,
standing by itself, is utterly valueless
as an economic proposition. The ques-
ton is, How much is need at the
present time?"
When the Rand was pouring out six
or seven millions month there was no
pretense that the world was getting
any too much gold. So far from it the
fact was recognized that the gold was
all being absorbed as rapidly as it
reached the market, and business was
being adjusted to the enlarged quantity.
Hence, if there was then none too
much money, it follows inexorably that
to suddenly shut off about one-third of
it would leave too little, and that this
would have a serious effect upon bust
ness is too plain to admit of denial
The original idea probably was that
England would conquer so quickly that
the temporary suspension of the supply
OF gold from that quarter could be Off
| set by an extension of credit But there
is always a point beyond which credit
cannot be carried with safety. The Sc
we're reverses Of the British army make
it reasonably certain that the war,
whatever the final outcome, will be
prolonged away beyond any time limit
that England's business circles had in
contemplation. AS a result, credit has
begun to break. People who have
bought stocks on margins are unable
to respond to the brokers calls for
| money. This forces the sale of the
| stocks and down goes the market.
But, as the Standard has heretofore
| stated. England has the advantage in
| such crises by reason of her position
as the worlds great creditor. She al
ways has money outstanding that she
| can call in when the emergency be-
comes great Accordingly we now be-
hold the spectacle of gold shipments
| from New York in the face of a trc-
mendous trade balance in our favor.
| Thus the strain is measurably trans
| ferred from London to New York
What the final effect will be remains
to be seen.
The New York market has been in a
feverish and nervous condition for
some time past. 1t is well known that
only few weeks ago Secretary Gage
bought in the neighborhood of $40, O0O,-
! 900 worth OF bonds in order to put more
money into circulation, and now he
| proposes to anticipate the January in
terest account and pay out $1,000 900
more. 1t is idle to deny that there are
elements of considerable danger in the
| financial situation as it now stands
We should neither overrate nor under
| rate it. but trim our sails to the wind
| and hope for the best.