The sun. [volume] (New York [N.Y.]) 1833-1916, 1902-11-17
TIE FINANCIAL SITUATION.

believe what one wants to believe rather
than what il 80. and Ia love 10 hear what IL
pleasant rather than what is true. In many
departments Of life the practice Of this
amiable doctrine il not particularly harm
full but there il one department in vhich
il is exceedingly harmful and that is finance
A man. If he in very rich. may indulge lis
desire for always hearing and reading what
he wants 10 hear and read rather than what
he should on financial topics; hut il he does
So indulge himself he will not he rich very
long As the great mass Of those con-
corning Themselves with the stock market
aside from purely professional operators,
are buyers rather than sellers Of securities
and thus Interested in seeing prices rise
rather than fall. what undoubtedly delights
them mos, in financial criticism are argu-
ments showing that stocks, no matter how
high priced they may have become. are
selling below their value. and must certainly
advance further and they are usually much
Disguised II any one disagrees with them
and attempts to convince them Of their
error, even II the error he Of the graves,
character and most easy of demonstrate ion.
So strong and widely dispersed il this
feeling known To he that many pubica-
definite policy of barring editorial COM
ments. and in MANY cases even news items
that can in any way he said 10 tend tow
ard depreciation of values, and Of
giving currency only 10 matter tina, ia
"in favor Of the market" and from
which people derive encouragement
10 buy stocks and hold them, The alb
surdity - such position is recognized in
theory by everybody: and vet in pract ice the
owner If shares of stocks is ap, 10 find HIM
self buying the journal or the financial maya
zine that tells him each day and week that
there il really no limit that can vet be seen
10 the heights To which prices are climbing
When the dtbCcie arrives he reads long arti-
Giles about the affair in the familiar columns.
treeting the disaster as an event which
all intelligent people had long been an,ici-
patng.
Another deusion which habitua lly
Affects spectators as a whole profess
sional spectators being again excluded
j. that the critic who asserts that prices OF
securities in general are. for a variety
of reasons, too high, is necessarily an enemy
of his country and a disRruntled bear
regarding its legitimate business pros
perity. The basis of this sfTlc'ion is the
inability of the Spectator to conceive
any difference between his own operations
and those Of the merchant, the farmer
and the manufacturer. That Wall Street
is sometimes an indicator OF the state Of
trade and industry is very true, but il is not
an invariabie indicator; indie ed, it is very
often a mistaken one. Wall Streets fabrics
may rise and fall and the great structure
Of the genuine business Of the land remain
a. unframed as if schoolboy's soap bubbles
only had been burst and blown agains,
it's side. Wall Street may he STEPPED
in gloom and Possessed with the idea
that the country is going straight to
destruction, while solid and sagacious
business men quietly appear as buyers
of the valuable properties that specula-
tors are Offering al pittance. So these
solid men appeared, for instance. at the
time OF the Bryan panic. Undisturbed
they declared that prices had reached a
level that discounted even the event Of Mr.
Bryan's election. They entered Wall Street
and bought railroad stocks, some of which
have since risen in value a hundredfold
The same class Of men. il is needless To
observe, are likely to turn sellers when
Wall Street has become crazy with bull
enthusiasm.
Tn. events of the last two months. and
Of the last week. Justify a littl lie
moralzing Of this kind. In the early sum
mer it was clear to any disinterested and
ordinarily accurate observer Of financial
affairs that the capital of he country was
rapidly growing inadequate for the pur-
poses Of business and speculation al the
pace at which these were then proce eding
The capital of Europe had also been laid I'M
der contribution. but there were signs in
plenty that this source Of supply was drying.
Only one Of two things could happen-some
miraculous increase in the supply of money.
or a subsistence OF either business or specu-
lation: and il IL came TO that. there was no
doubt as to the region in which subsistence
would occur. To make this deduction re-
quired about the same amount Of ability
as TO perceive that two people cannot
wear the same shoes at the same time.
that a bushel of grain cannot be placed
in three peck measure, that water poured
into a sieve would assuredly reach the
ground, and other elementary propositions
of similar nature Long before Mr. Van
derlip or any other banker made his pro-
fcssion Of alarm in public over the expansion
Oh cIetlll ana lHe conversion OF lpllO capital
into fixed investment, there were financial
critics who emphatically directed attention
to what was going on. The report OF the
condition of national banks made to the
Comptro Of the Currency last April
afforded statistical proof Of the develop
ment OF the evil, even il daily testimony
TO the same effect was not furnished by
the lists of the Stock Exchange But the
warning was unpleasant. People did not
want to believe il So they did not believe
il and declared that those who uttered
il were unable TO comprehend the modern
v of the United States. They found
ample support, OF course, in a large section
Of the new spaper and financial press. even IN
publications that laid great store by their
reput alton for conservatism ard statistical
aut horty Little wss heard there about
he threatened danger, The orgy of stock
gambling was called the march OF invest
men, and the coarse reckless. freebootinp
spawn who had laid hold of Wall Street
were described as the new fnanc ial cap
aims" of the land So the POPULATION wen,
on, rejoicing and increasing, and the dav
Of doom approached with the elaboration
and surenoss Of tho prec' ssion Of tho
nquinoSes. The great Louisville and Nash
vile coup was sprung with it's profit ~ mil
lions, aud in every village and city Of the
country especially I'm tho West the ina Gina