The Indianapolis journal. [volume] (Indianapolis [Ind.]) 1867-1904, 1904-01-01

Twelve months ago this country was in
some danger of serious financial difficulties.
Too much speculation, too much of n
has been termed high finance" were the
danger points. The condition is reversed
now, and the country is in no danger what
ever of financial trouble. The year 1904 be-
gins with the country on a sound and safe
financial basis.
The chief source of danger a year ago was
the overjudicious expansion Of credits and
the greatly eXaggerated-or 'watered'-
value OF securities. The country was fairly
running over with prosperity-but not pros
perity of the stable. substantial sort.
There was too much so-called paper
wealth in this prosperity. Early in the new
year there sprang up an apprehension that
the country's prosperity was not on a sound
basis: that there was too much water" in
security values: that the country must get
on a more substantial basis. The trouble
was not that there was not enough money
in the country, nor that the crops had not
been large, nor that there was a falling off
in the foreign trade.
Here was the trouble-Wall street was
using too much of the country's wealth in
speculation; companies were greatly over
capitalized; there was too much Of what has
been called high finance With the spread
of the apprehension security values began
to decline.
Just at that time the real danger point
was reached. Millions of dollars of capital
of the largest financial institutions in the
country, especially those OF New York.
were invested in these securitieS-the Sc
curities whose values began to decline
rapidly. The process OF taking the infla-
ton out of securities had begun. II this
imitation could be taken out of securities
gradually the country could get down 10 a
sounder and safer financial basis without
a financial crisis or a panic. The govern
ment and the greatest financiers of the
country took the situation in charge. so
to speak, and the deflation process was
held in check.
BY slow degrees Wall street came down
from its dangerous elevation Of overex-
pansion Of credits and initiation OF security
values. About three months ago stocks
reached the bottom. or most of them did,
at any rate, and the danger of financial
trouble was passed.
THE LESSON OF 1903.
A great and a valuable lesson has been
taught by the country's financial expert
ence in ~190S-there is a limit TO credits and
imitation of security values. Although the
country has not been seriously injured by
the experiences of the past year, this les
son has been taught well, and il will not be
forgotten. The lesson had to be learned.
Another thing has been taught by the
financial experiences of this country the
past year-that Wall street does not WELD
the same large and potent influence on the
country generally, and upon the trend of
general pushes and industrial sentiment,
it used TO WELD. Ten years ago Wall street
Cor the East was the financial pivotal point
of the country. Wall street furnished the
West with its money and took mortgages
ON the Vests railroads., factories, ware
houses. etc. Now the condition is reverse;
the West can take care Of itself. The West
has money now, all it needs for its own
uses. and some loan to Wall street
The other lesson that has been taught by
the financial stringency in Wall street the
past year, besides the lesson that it is not
safe to overcapitalize and ~overextend
credits, is this That the general business
of the country goes right along. from week
to week and from month to month. even If
Wall street is hard up"
STOCK MARKET INFLUENCE DIMIN-
ISHNG.
"A fact that cannot be impressed too forci-
bly, nor too frequently on the business
mind these days is that stock market
movemen and stock market incidents are
Of steadily diminishing influence in i'm
portance as aids in determining the gen.
eral business sentiment in this country, or
the real conditions and prospects In trade"
says the New York Journal Of Commerce.
sgTbfS foot haa haan Claarlv Illustrated
within the past twelce months. With bump
er crops, congested railway traffic, normal
activity in construction and in general
trade, heavy exports of natural products
and manufactures, large imports of gold
and 14-cent cotton. the stock markets Of
the country have been for weeks at a time
at different periods the only soft spots in
the whole business situation. Time was
when such a condition would have been
quite sufficient to have 'softened' the whole
commercial and financial outht from ocean
to ocean. But somehow it didn't this year.
We don't believe 1T ever will. of itself.
again.
I'm fact. the regulation ante-panic mani
festations are nearly all absent. Money
market shocks that once would have pre-
c~ipitated crises have recently come and
gone without leaving hardly a scar. There
is no rush for the withdrawal of foreign
capital from this country, because we no
longer owe Europe anything; at times dur
Ing the present month we have been i'm
porting EurOpe's gold at the rate OF 5000
600 a week; the consolidation Of great in
dustrial and financial enterprises has been
and is a steadying influence in our affairs.
chiefly because of the limited control that
prevents ruinous competition and over-pro-
duction; there is a remarkable sustenta-
ton OF railway earnings; our monetary sys-
tenn isn't perfect, but the whole world has
now a supreme confidence in il since we
have cut the weak spots out OF it.: there is
no fear abroad or at home OF any change
from the gold standard, as there was ten
years ago-no fear of any change from our
present tariff policy; the coming election
holds out no fears either in the prosecution
Of the campaign or in it's results; employ
ers are organizing to check the aggressions
of trades unionism. and we are going 70
build an interoceanic canal. and build il
light and build il quick. too"
CAUSES OF APPREHENSION.
The first and the initial cause Of the ap-
prehension in the financial community
IN INDIA