The news & observer., 1905-12-31
JOHN BASSETT MOORE.
William Sherer (Manager of the New
York Clearing HOuse) on
Finance.

1t seems to me that the striking
| feature in the financial history Of the
United States for the year 1905 is
the record made by the Clearing
House Association of New York. /
will cite few figures first and then
attempt to give brief explanation as
to their meaning In the year ended
September 80, 1905, which is the Clear
ing House year. the transactions in
the New York Clearing House aggre-
gated approximately $96. 1000.
OF these transactions approximately
1872 900, 100000 O am using round
numbers) were for exchanges and ap-
proximately $4,000 100000 We're for
balances.
There is no record Of any preceding
year that matches this. The greatest
transactions reported for any one year
before that OF 1905 were in the year
1901, when the exchanges aggregated
SIT ,0O0, 100000. The average daily
clearings for that year were 1884, 4,0O0.-
600, Cn round numbers,) while the
average daily clearings in the year
1906 were 100000.
These figures are 50 stupendous
that the human intellect cannot fully
appreciate their meaning. Upon analy-
| sis of them some striking facts, now
ever, are brought out. For instance.
| in the clearing house exchanges, that
it to say, the exchanges of the checks
and drafts of the banks, among them
! selves, were approximately S9Z,VOo'-
| 100000 and it only required $4,OO0,-
| 100000 to pay the balances. These
! figures show how small part rela-
| lively actual cash is playing IN the
perfecting OF exchanges and trade.
| The extension of bank credit. the
almost universal adoption of the fa-
| cilities of banks SO that the greater
| part of the cash of the country is
placed upon deposit in the banks sub
! iect TO check or draft is one Of the
most interesting and important or the
| features of American financial deVel-
| opment. BY the utilization of these
instruments Of credit it was possible
to perfect in the New York clearing
house in one year exchanges aggregat-
! ing the colossal sum of $92, 2,0OO,0OO,-
600, these exchanges being perfected
by the payment of only $4,0OO.00O.OOO
in the way of balances.
! | observe that throughout the Uni
| ted States the record of the various
{ Clearing House Associations compares
favorably with that made by the New
York Clearing House. | do not now
recall any Clearing House Association
/ in the United States whose record TINS
wear was less than that of any other
year, whereas many of them report
| relatively as handsome an increase as
! that reported by the New York Clear
| ing House Association. On the whole
| there is no better way of estimating
the business condition of this country
| than by the record made by the Clear
/ ing House Association If 1t is not
| the barometer of trade, it neyerthe-
| less tells the story Of trade ana COM
merce, illustrating production ana
| consumption and the transactions IN
the various markets.
The New York Clearing House AS
sociatiol makes a record that is ap-
proximately some 68 per cent of the
entire clearing house transactions
throughout the United States. l have
lno doubt that when comparisons are
made between the records or all the
clearing houses other than that or New
York with the record made by the
New York Clearing House they VIII
show that from 6S to 70 per cent or
| the entire clearings of the country
for 1905 are those reported by the
New York Clearing House Association.
That of course does not mean that SO
| great a percentage of the trade ana
/ commerce of the country as that Is
controlled by New York city. But
New York is the great financial me-
tropolis of the United states, and Is
rapidly approaching a position OF
equality as hnanclal celscl WIN
i London. Many of the transactions
! done elsewhere in the United States
are paid for through drafts of ex-
change bought upon New York. NJ 1re-
over. very much of the borrowing 'or
capital is either made in New YORK
or arranged in New York, and the
4 Indirect influences Of that are felt in
the New York Clearing House. That