The Washington times. [volume] (Washington [D.C.]) 1902-1939, 1903-03-15
LONDON MARKET LETTER.


LONDON. March 1.-THE decline in
consols this week 20 the lowest point
for generation, which was DIE ad-
mittedly to American influences. has
again drawn attention TO New Cork as
the almost dominating factor in the
worlds financial situation. II is still
customary TO regard British funds as
the most reliable barometer of both the
financial and political conditions Of the
world at large Their value in this re-
spect, however. is uuquestiouabIy dimin-
ishing, although. perhaps, only tenn
porarily. The chief cause Of the pres
eut low price is the reduction in the
rate Of interest. which was decreased. a
few years ago. when the price was at
the top notch and money was cheaper
than ever known before. There is also
some political uneasiness. due TO fear OF
a rupture of international peace in con-
nection with the Balkan crisis or the
possible outcome Of Hollands domestic
troubles. combined with Germany's
covetousuess toward the Dutch kingdom.
The immediate cause. however. Of the
extreme decline Of British national
credl. is undoubtedly the sale in Amer
lea Of a large portion OF the 500 ,o0o. OOO
OF consols held there, together with
American borrowing in an already
stringent European money market II
is no. considered probable in London,
Paris. or Berlin that there viii be any
substantial relief Of this stringency in
the near future II is recognized that
/ American conditions will largely control
the general monetary situation for the
next few weeks. and in the absence OF
necessary legislation by the United
states f. is not understood how the alb
normal and unnecessary scarcity OF
money can be remedied.
This difficulty arouses a renewal of
/ very severe criticisms, which are cur
/ rent in many quarters here, OF Congress
and It's impotence in any matter of real
reform Thus the "Statist" urges il is
/ desirable that President Roosevelt
should call Congress in special session
\ and request 10 10 take measures for the
permanent relief Of the money market
I II this IS done the 'Statist" expects the
/ President will at least recommend that
/ power be given the Secretary OF the
/ Treasury TO lodge the proceeds Of Gus
I toms as well as internal revenue with
]
/ security II this is done 70 would add
/ largely to the resources at the disposal
/ % the market. and therefore diminish
( considerably the danger in the autumn.
/ Perhaps il Congress is convened FOR
| the special purpose OF dealing with the
/ banking and treasury laws. it may take
/ courage and pass much more compre-
hensive measure. In the first place, the
/ banks are now required 10 keep in cash
/ either - or 25 per cent Of the deposits.
/ and must not touch those reserves. no
matter what may happen 10 the trading
I community.
We" SAYS the 'Statist.' - suggest
/ that this should be modified TO this ex-
I tent. that the banks should be allowed
f. to use IN lending and discounting. part
| Of the reserves, provided they pay a
. duty OF say 3 per cent TO the Govern
: ment. Furt hermore. the banks are now
/ required TO lodge in the Treasury as
security for their note circulation. bonds
[ OF the United States, but these bonds
are so scarce and dear that this is not
tpFo6tabl especially as the law forbids
| he banks TO reduce their circulation
| quickly. The banks should be allowed 20
/ issue notes on the security Of gold