The Anaconda standard. [volume] (Anaconda, Mont.) 1889-1970, 1899-09-19
CAN'T STAND PRESSURE
England Is in Dread of a Gold
Famine.
IT CAUSES APPREHENSION
The Stoppage OF Gold Supplies From
South Africa May Lead to a FL
nancial Panic in London.
Not Enough Gold.

New York. Sept. 1S.-The Times Lon
don financial correspondent cables:
Our money market anxiously begins 10
reckon upwards. All last week we were
hoping against hope that peace might
be maintained. AS / write that hope
has almost been abandoned and rates
Tor money are therefore tightening
wholly irrespective of business de
mands. These, indeed. are very mod
crate for the home account Our dis
count market would have little occu-
patton would it depend on the domes-
tic supply of bills. for that does not
now amount to 25 per cent of the total
value of paper handled
This is one great source of anxie:y
for our credit institutions. Not so
many years ago quite 20 per cent of The
exchange of the current year was of
English origin: now Il is quite the other
way. Not only the British banks and
discount houses buy foreign bills in
large amounts, but French, German.
Russian, Dutch and japanese banks
possess important London branches en-
gagged in placing a large number of
bills on our market. During your ex-
port season every American mail brings
heavy consignments of your mercantile
paper. 1t Is therefore of the utmost i'm
portance that no hitch should arise to
prevent our credit establishments from
being able to regularly handle this
stream of remittances Dear money
must produce this hitch and I fear a
war must force our market sharply up
Some days last week the discount rates
slipped below 3k per cent.
On Friday and yesterday brokers
quoted 3& per cent for 90-day bills and
for foreign bills of four months 3% per
cent.
Greater dearness is expected this
week, although money until to-mor-
row was offering at / per cent All
along short advances have remained
easy at to 21a or az per cent. Even
last Friday Stock Exchange payments
drove quotations on call money to per
cent for an hour or two.
Indeed. most bankers had loans re-
paid because speculative accounts have
been much reduced through the dread
of war. But cheapness of this kind
means nothing more than the desire 10
keep credits at elbow, so to say.
Tested by the cash gold held In our
banks. we are in no position to stand
pressure for one day. Including their
balances at the Bank of England they
probably do not hold per cent of their
liabilities to depositors in gold, as an
able correspondent points out in to-
days Investors Review. but it is just
their capacity to pay gold that may
soon be put to the proof.
The Transvaal is the PRINCIPAL source
OF gold supply-almost the only present
source, but the Indian government pur-
poses to buy the output of the Indian
mines and Australian production is
r. n,ntIx .A.1
War in South Africa would not only
stop supplies from the Rand mines for
time, but subject the Bank of Eng
land to drain of sovereigns for the
Cape. Already a million has gone
fhither exclusive of small consignments
from Australia. Were the Rand pro-
duct of over s1,6oo,0o0 month
stopped, a gold pinch would therefore
be upon us almost Immediately, and
am unable to sketch the trouble that
would follow. Why, then, go to war?
In my opinion, because Cecil Rhodes
Chartered company is nearly played
out. 1t has spent e57,0O0 900 and has
little to show for the money save
huge territory almost completely I'M
productive. The Wanted Rhodesian
gold mines produced little more than
G 900 gross gold in the last IL months
and the output in August fell to 3,179
ounces.
LdDOT cannot De n9Q, as the MAtd-
beles refuse to enter the mines, and as
the expenditure of the Chartered COM
pany exceeds its income by nearly
9500,000 a year. on it's own admission,
better fight with the chance of annex
ing the Transvaal than allow the fiasco
10 reach it's natural and inevitable con-
clusion.
The prospects thus opened up cause
apprehension. Our credit system is so
delicately poised, so absolutely depend
ent upon our command over the sup
plies of gold at the moment they are
required that the stonpage of such sup
plies at any point is calculated to disar-
range the whole machine.
In their anxiety our bankers are al
ready discussing the probabilities of
New York taking gold from here this
autumn and the advance in your rates
for money is not calculated to allay
these fears. Our position is much
weaker in the face of this contingency
that 1t was a year ago. Then we had
an abundance of your securities, for
which a market could be found on the
continent as well as in America; now
we have only few.
The story that all danger of a famine
in India has been averted is untrue.
The rain came too late to save the prin-
cipal crops.