The farmer and mechanic. [volume] (Raleigh, N.C.) 18??-19??, 1902-08-26
WILL THE INDUsTRIALS T1PPLE
OVER?

For months the Morgans, the Rookie
~fallers. the scnwabs and other organizers
Of trusts have been making something
out OF nothing. The time, OF course, is
coming when all the watered stock and
bonds will collapse unless the prices are
made sufficiently high TO pay dividends on
the watered stock. It does not require
a seer to predict that when the time
comes that the watered stock does not
nav a dividend-then, what then?
Walter Wellman. the Washington cor
respondent OF the Chicago Record-Herald,
quotes a member OF Rooseyelts Cabinet,
| understood to be Secretary OF the
| Treasury Shaw, who declares that there
| will be no revision of the tariff. He de-
| clared that agitation of tariff revision
i the worst Of it," and then he went on
| 70 make these remarkable u~tterances
that will ~startle many who have not
| thought of the situation stated by the
| Secretary of the Treasury:
There is widespread belief that no
danger of panic or hard times exists IN
our country low. Prosperity is so great
| and so general that the people are unable
| 10 sec any end Of it. | am not an alarm
ist and | am not expecting trouble, but
It is true that we nave today all the
conditions for a sharp reverse. There IS
| a general supposition that both the banks
and the people have so much money they
| do not know what to do with it. and that
therefore a panic is an absolute lmpossi-
bility.
Let me give you some facts without
comment. You go out to the farmers
and ask them how they are getting on.
They will tell you that they were never
before SO prosperous. They are out of
debt and have plenty Of money. Ask
them where their money is. and they will
tell you it is in the local banks. Call at
the country banks and inquire into their
condition., and their officers Will tell you
they are all right. Money plentiful and
reserves above 40 per cent. Where is
your money?' OF it is in the banks
of Omaha, Minneapolis, Kansas City, etc
Next you go to the bankers in
Omaha, Kansas City and Minneapolis,
and they will tell you the same thing.
They are in good shape; reserves 50 per
cent. where is your money! In
Chicago Now go to Chicago. Same
story. Banks all right. Reserves 30 per
cent. But the money is in New York.
Finally, pursuing your inquiries in
New York, you will find that both de-
posits and loans have been enormous.
The money is not in the banks. There
are only six National banks in New York
that have not been below their legal re-
serves since January 1. You want to
know where this money is? Well, $780,
600, 600 is loaned by National banks on
the bonds of industrial corporations.
These corporations issued bonds instead
of stocks, because the National banks
can take the former and can't take the
latter. Intrinsically they are no better
than stocks. In most Of them there has
been a lot of water curing. Here you
see where $3.50, 900, 900 of the country's
surplus stands against a lot Of undi-
gested. pronlotion-produccd securities.
The trust companies have put out mil
lions more in the same way.
THAT IS where we stand. 1t is all
right as long as it is all right. But |
don't want to see anything happen. I
don't want to see these industrials be-
gin TO topple over. to fall against one
another and come down in a heap like
children's playblocks. And this is one
reason why | an opposed to a tariff re-
vision agitation that might start things
going the wrong way