The times., 1899-07-19
MORE MONEY FOR AMERICA.
Opinions of Treasury Expert on
the Financial situation

opinions of Treasury Expert on
the Financial Situation.
One of the most prominent of the au-
thorities in the Treasury Department has
given to The Times this estimate as TO
the probable increase in money in this
country during the present year:
1t is believed that the mines of this
country will produce s7O.OOO,O 900; Mexico,
Sl2,0O0,OO0 to $4,000, 900; the Klondike,
100000 600. and British North America,
outside OF the Klondike, s7,O00,0o0 to SlO,-
100000. This amount, in round figures
S110. 0.000,0 ,000, will nearly all be received by
the United States. To it should be added
the profits on the coinage of silver by
the Government, which will be about So,-
500,0 according to the present market
value of silver. Allowing for the amount
of gold mined in America that does not
reach this country, it is estimated that the
total new wealth during the year VIII be
about 800. 900. .O0O II from this is sub
tracted the excess of export of gold over
import during the year. the remainder Will
represent the added amount OF money at
the end of the year. The estimate made Is
that this will be more than sSO,o0O,Ooo
The gold production of the world is at
present increasing rapidly. 1t Is estimated
that the amount taken out of the Trans
vaal district alone will be at least SlUe,-
COO. 900 for the year, which is the largest
output ever made by any one district
In this connection it is interesting to state
that the experts who have examined the
South African gold fields believe that in
the next thirty years they will produce
81 500 000, ,0O0 before they are exhausted.
The opinion of this Treasury Department
authority is that the general plenty OF
money in this country will increase rather
than decrease during the year, for this
reason, and that the general money situa-
tiOn will continue to be one OF extreme
ease in rates, even more remarkable than
has been seen already. This estimate does
not take into consideration any return of
gold to America from Europe, despite the
fact that the balance of trade in America S
favor is great. An excess of exports OF
gold over imports is, indeed, estimated as
stated above. The question OF exactly what
becomes of the immense trade balance in
Americas favor is puZZling the keenest OF
the financial critics, and II is not one to be
answered offhand. During the past two
years this balance has been more than a
thousand million dollars. An enormous
amount of American securities has been
returned from abroad in recent years.
which cuts heavily into the balance. This
return of securities cannot be estimated
accurately on account of the active trading
in Americans at all times, but it is
known to have been immense. America is
now for the first time in its history, too
creditor nation, lending money abroad by
the many millions of dollars against the
trade balance. Money Is cheaper in this
country than it is in Europe and Europeans
can afford to borrow and American capital
lists can afford to lend. 1t is believed, how
ever, that despite these two heavy drains
on the balance of trade account there is
now due to this country many millions Of
dollars.
1t is one of the seeming paradoxes of
finance that with this condition of immense
prosperity. with the amount of money in
the country increasing at the rate of $780,
100000 this year, New York should at this
time be frightened by the menace of light
money, fearful lest gold shall be export
ed. and lest the calls OF the remainder of
the country for money to move the crops
shall be so great as to cause panic in
Wall Street Europe, which owes this
country hundreds of millions will probably
drain the New York banks The West
and South. with money cheaper than ever
before, will take of New York, whose bank
reserve is only SO, 100000 above the legal
requirement.
This New York situation is most in
teresting one. 1t cannon be doubted that
though it is possible that trouble may be
averted. The statement of the New York
banks on Saturday July s. showed the
reserve fund to be decreased to within s5,-
100000 of the legal limit. This was an
extremely poor showing for this period OF
the year to say the least. 1t compared
with $50, GOO 600 reserve at the same period
a year ago The statement on last Satur-
day showed an increase in the reserve to
SIC, 500. 600 over the legal requirement. still
a most unusual and most uncomfortable
situation Briefly stated this condition Las
been brought about in this way:
The banks are at fault, or their policy.
rather 1t is recently the confirmed pol
icy of the New York bankers to get every
possible dollar from the country at large
into their grasp. This money has been
lent industriously up to near the legal
limit During the past three months there
have been drains on the banks from Eu-
rope, some 900 going abroad. from
the interior and from the Government.
Loans have continued to increase. This
situation would not, perhaps be diza-
greeable one except that having gathered
the surplus from the interior and disposed
of it in loans the banks are now confronted
with the midsummer season, when i'm
perative calls for money for the moving
of the crops invariably increase. The
money must go out. 1t seems probable
that the calling in of loans on large scale
will result
higher interest rate abroad adds to
the difficulty of the situation by making
ii we'll nigh certain that American cap
italists will send their money to the ether
side to take advantage of the stringency
and desire for gold there. These matters
may quite possibly make money tight in
New York for time, for long enough to
cause a tumble in stock market prices.
but it is not possible that the general mon
ey condition of the country can be any
thing else than most satisfactory.