The Saint Paul globe. (St. Paul, Minn.) 1896-1905, 1899-07-16

Commercial Disaster.
There WAS brief paragraph printed in
Londan dispatch recently, only three or
four lines, which probably attracted more
attention from men in business that the
rest of the news in the columns. 1t was
to the effect that the present industrial
boom and era of higher prices extending
not only over the United States, but to
other parts of the world as well, had en-
abled the Earrings to market Argentine
Confederation securities that had been
carried since their failure at prices which
added several millions to the value put
upon them in 1890 The three or four
line paragraph referred to an event which
Is kind of a date line in American COM
merctal history, a sort of an end of an
old era and beginning of q new. The
Barring failure, though the United States
were only indirectly interested in it, acted
like a snuffer on a candle in this country.
England recovered from 1t in a few years
1t was not until the spring of 1888 that
the effects were wholly gone in this coun-
try. a few days ago orders were placed
for rails for small road down south
which was quite ready for construction
work when the Earrings went down. 1t
has taken nine years to recover from the
effects of that failure There are hun
dreds of similar instances.
1t lacks few months of nine years
since Barring Brothers & Co. announced
their inability to meet acceptances. In
1890 there was not a civilized land in
which the firm was not known as one Of
the great banking houses of the word.
1t had been a long time reaching that
distinction, for the house was established
in 17J9. John Barring, son of German
minister near Bremen, founded the bust
ness at Exeter. His two sons removed
it to London and adopted the name which
it afterward bore. The Earrings were
merchants originally and laid the foun-
dation of their fortune in trade with
India. Several members or the family
We're directors in the East India COM
pany. Gradually the house became the
great bankers of English commerce. They
dealt in exchange and drafts in every
part of the world. Most of the purchases
of merchandise in India, China, Japan
and in North and South America made
by the English were paid for through
the Earrings. The house became better
known than the Rothschilds even, who
came less In contact with the public. All
the states of Europe sought their aid.
ONE DIRECTION AT A TIME
It seems to be the habit of the English
investing and speculative public to turn
their attention in one direction only at a
time in the sos their interest was con-
centrated in South America, especially
in the Argentine Confederation. Daz-
Zling stories were of tha r.icbac of
that country. 1t had resources exceeding
In wealth those of the United States. In
Vulnerable companies, proposing every
kind of enterprise, were fioated in London
to operate in the Rio de la Plata coun-
try. The Argentine government aided
the excitement by planning and executing
vast national works and improvements
and also by increasing It's currency-a
step which at first was regarded with
favor. For two or three years almost |
any security that had the name Argen-
tine on it was in high favor in London.
The Earrings We're in the front of the
movement. The house broke away from
its old conservative policy and became
practically huge promoter. After
bringing out the Guinness Brewing COM
pany 1t jumped headlong into the Ar
gentine and Uruguay fields. Between
1882 and 1880 the Earrings floated securi-
ties issued by these two countries and
"
tent of $500, 600, 600
In the year 1888 alone over SAC. 0O0. 900
In securities were issued through the
house. There were government loans
railroad, bank, steamship and elevator
stocks. Everything imaginable that i'm
piled industrial enterprise In the stream
of securities that poured into a ready
market. Thousands of peopia made
money; hundreds got rich in the wild
speculation engendered. The Earrings
were supposed to have profited most of
all. No one thought of putting the wealth
of the firm at less than $3.50, U00,U0
REVIVAL IN BUSINESS.
Between 1887 and 1889 England expert
enced a great revival in business. Rail-
road earnings improved per cent, gen
eral commerce Is, wages advanced, bank
cleartngs in London showed an increase
Of rs per cent, all of which aided the ex-
element in Argentines and added to the
prestige of the Barings, who were popu-
larly said to own that country In 1889
there were symptoms of trouble. They
became more marked a few months later
when people begin to figure up the i'm
mense mass Of securities bearing the
name Of Argentine on them. 1t was an
impossible task. The government of that
country had believed even the ground
could be transposed- into money thus
showing the craze that infected private
individuals. The Argentine note circula-
tiCn was ridiculously inflated. In tine
spring of 1890 the Bank of England adj
vised the Earrings to reduce their ac-
ceptances, which at that time amounted |
to e30, 100000 In the following July, after |
the revolution In Brazil, the bank sud !
denly raised Its rate Of discount to per