The Savannah morning news. (Savannah, Ga.) 1900-current, 1903-10-21
FINANCIAL TROUBLES IN BALTI-
MORE.

There was undoubtedly feellng OF
relief in business circles in Baltimore
yesterday when there were no indica-
tons of a run on the banks. On Mon
day it was feared that the failure of
the Maryland and Union trust COM
panies would so impair confidence in
the financial institutions of the city
that there would be a rush of deposit
ors on Tuesday to get their money, and
| that a bad financial situation would
! be made a great deal worse. Deposit
ors in savings and other banks, how
! ever, seem to have understood the
cause of the failure of the trust COM
| panies and that the banks were in no.
! wise affected by their misfortunes. The
| indications now are that in a few days
| the shock which the failures gave the
! business interests of the city will have
! practically disappeared and only those
Immediately concerned will give the
failures much attention.
The cause of the failures are Of
course well understood. The trust
companies, relying upon the ability and
willingness of the public to take an UNI
limited amount of securities, backed
turned out well if the money market
had remained easy until they were COM
pleted. In this way the trust COM
panies became loaded with securities
which they could not dispose of. The
result was they had to close their
doors.
1t would not be surprising If there
are other trust companies in various
parts of the country which have more
undigested securities on hand than they
can carry with comfort. No doubt
they took them in good faith, believ-
ing they would be able to market them
at a price that would yield hand
some profit. If they are to be criti-
cised at all it is for being too anxious
to get rich quick, for not being more
conservative. Promoters of enterprises
of various kinds did not seem to re-
alize that there was a limit to the
capacity of the public to absorb Sc
curities, and some trust companies and
underwriting syndicates encouraged
them to increase the volume of stocks
and bonds.
The failure of a trust company, a
bank, or a stock broker here and there
does not, however indicate the ap-
proach of a period of hard times. In
about all parts of the country bust
ness is good. The farmers have good
crops and they are getting good prices
for them. There is of course a little
depression in the iron and steel trade,
but with that exception the Industrial
plants have about all they can do. The
signs, therefore, are for continuance
of prosperity rather than for period
of business depression.
OF course there will not be much
for promoters to do for a good while
to come. 1t will take the public sew
eral years to absorb the securities al
ready on the market, and it may be
that great many of the undigested
securities will be eliminated altogether,
but it ought not to be very long before
securities of real merit begin to show
an improvement in price. No longer
ago than last week there was a strong
impression in Wall street that the up
ward turn ttlat had taken place in the
price of such securities would be per-
manent, and that 1t would not be long
before they would be bringing about
as much as they brought before the
period of liquidation began. The fail
ure of the two trust companies in Bal
timore, however, is having a dampen-
ing effect on the security market and
may even further depress the prices
of the best securities.