The watchman and southron. [volume] (Sumter, S.C.) 1881-1930, 1903-09-02
The searity Of Loanable Capital.

It is interesting to note that the
troubles which have oyertaken the
American stock and money markets
ara by no means unique or peculiar.
According to the latest advices, the
London money market is s1ferlng
from a disease of somewhat similar
character. It has been noted that the
London stock market was at stand
still. There, as in Wall street, there
is very marked lack of buying power.
While London has not suffered from
liouidating sales to the same extent as
was the case on this side OF the ocean,
it is observed that the congestion OF
new securities is serious matter and
is accompanied by a falling away IN
the bank deposits, together with an
unusually large proportion OF loans. lt
is stated that bankers and professional
underwriters Of new enterprises at
London are unwilling at present to
take hold of operations Of that kind,
and that many applications for fresh
loans for governmental and corpora
tive purposes are held up for the time
being, while the British public mani
tests the strongest Discrimination to
interest itself in new stock issues. In
feet. the troubles here and the recent
liouidation and slump in Wall street.
would appear to have been after all,
as is generally the case in such mat
tiers. manifestations Of tendencies in
connection with finance in general and
the supply of capital available for cor
porate and other borrowings not en-
tirely confined to this country.
In treating of this subject the lead
ing London financial journals, while
giving certain prominence to the
effects of the imitation and subsequent
decline in the Amerian markets, begin
to freely confess that thei, own hnan-
ciers, promoters and investors have not
been free from blame. The extraor-
dinary borrowings by the British gov
eminent during the Boer war and the
fact that considerable part Of the new
loans contracted for war expenses
were not absorbed by investors seemed
to serve as a starting point. While
the government was spending enof-
nous amounts of money British trade
experienced the stimulus which ordl::
narily accompanies such a state of
affairs. When peace was restored it was
thought that resumption Of activity
in the Transvaal gold mining region
and a heavy inflow of specie from that
source would have a sustaining effect
on the British financial position. Ow-
ing, however, to the dearth Of native
labor and other causes, the out put OF
the Rand mines, though steadily in
creasing, is still far below expectation,
and it must also be considered that
there was natural, immediate and,
on the whole, unsuccessful tendency to
create new South African mining en-
terprises, which, though it did not
last long as movements Of this kind
90, nevertheless brought upon the
London market quantities of new
securities which in measure play the
same part there that our own IN
digested or inoigestible industrials do
in Wall street. Furthermore, colonial
and municipal borrowings have of late
attained magnitude which has Sc
verely tested the absorptive abilities Of
the English money markets. These
considerations must be taken into ac
count in any comprehensive view Of
the general money market conditions.
It would seem as if the new buying
power which is needed to take up the
strain that has been placed upon both
Wall and Lombard streets would have
to be found outside of the stock
markets in this country or England.
If such buying power exists in other
countries, the question as to when and
in what form it will materialize is
subject for possible thought.-Brae-
streets.