The Indianapolis journal. [volume] (Indianapolis [Ind.]) 1867-1904, 1900-06-08
MAY FAILURES ANALYZED
GREAT INCREASE DUE LARGELY TO
OVERSPECULATION.
Manufacturing Liabilities Also Are
ties at q Minimum in the Array.

NEW YORK. June 7.-Dun's Review will
only the largest ever known in that month
since such records were made, but of eighty
months covered by these returns only six
have shown as great liabilities. Contradic-
tory though it may appear, the report is
encouraging. There was not single fall
ure in the month which was calculated to
shake or did shake commercial credits
which were stronger at the end of May
than at the beginning. Neither were there
any failure or nest of failures calculated to
create alarm about any particular branch
of business.
The large brokerage failure for about
s13, Co., 900 exceeded in amount all failures in
any other month, except one, since 1898,
and with it came another for s735.OO0. Near
ly 60 per cent. of the total defaulted liabili-
ties was due to five "other commercial"
failures. while the ten large failures in
manufacturing and trading covered less
than 100000 liabilities in all.
The number and amount of liabilities of
all commercial failures in May, compared
with last year, are given below: May, 1900.
947; 1899. 5S1; liabilities, May, 1900. s2 al, Isl;
1899, s., 500, $3.50.
The returns to Dun's Review for May
show an unusually large number of small
failures. They exceed those of any other
year but one, and this is considered sug-
gestive. also the increase of over an eighth
in average liabilities. This, the Review
says, is readily traceable to the manufac-
number of smaller failures in trading show
lower liabilities than in any other year ex-
cept one. Manufacturing liabilities have
much increased, however, the average for
a. x.l~ 49,
1t might be inferred that there had been
a really noteworthy expansion of manu-
featured Indebtedness for the season, and
in January a similar increase appeared,
though very little in February and March.
In April the increase was about $500 TO
each small failure, and in May 3,400. 1t is
not difficult to surmise that this has con-
nection with the general slackening of or
ders for manufactured products, which has
now begun to produce a readjustment of
prices.
The trading liabilities of small firms also
showed little increase In January, but q
decrease of nearly 10 per cent. in February
and a still larger decrease in March. In
April the decrease was very slight and in
May also. AS there has been considerable
question in regard to the progress of retail
trade in this respect. the fact that even
with the hundreds failing each month the
average of liabilities is not rising, but has
remained unusually steady and below the
range on most previous years, is of prac-
teal value.
Unfortunately 1t is the fact that no re-
turn to normal state of prices, after such
an excessive rise at was seen last year
can be accomplished without losses to
some. If all would set themselves together.
and at once, to get back business to rea-
sOnable basis there would still come dis
aster TO those whose holdings cost above
the level. The efforts of many manufac-
turing and trading commissions to prevent
decline In prices will only increase the loss
where the effort now fails. as in the case
of cotton and silk. The large amount of
failures for the month can only be re-
garded as evidence that many firms have
not been able to escape serious losses be-
cause they held to the hope OF high prices
too long.