The Birmingham age-herald., 1906-01-05
Gigantic Panic is Coming Un- less Something is Speedily
 Done to Relieve Situation
IMMEDIATE RESULT IS
 SENSATION IN MARKET
New York Banker Thinks the Present Condition of the Money Market Is a Disgrace to Civil
 ized Country.

New York. January 4.-Unless there is currency reform a panic beside which former panies will seem insignificant, was predicted by Jacob H, Schiff head of the banking firm of Kuhn, Loeb & Co.,, in speech before the New York cham Der of commerce today.
 MT. Schiff said he did not regard such a panic as imminent, but believed it will come unless something is done to remedy the lack of elasticity of the present cur rency system. He declared that he did not favor the plan proposed by Secretary of the Treasury Shaw for relief of the situation, it being his opinion that the secretary's plan would aid speculation, rather than legitimate business
 Mir. Sehiff favored currency based on commercial paper as more healthful to the general business interests of the country.
 Speech Creates Sensation.
 The speech created a sensation in finan- cial circles and caused sharp break in prices on the stock exchange. The meet ing of the chamber was attended by a large number of business men and finan- ciers, and a resolution on the subject offered by Mir Schiff was unanimously adopted. This resolution was as follows: Resolved. that it be referred to the committee on finance and currency tof the chamber of commerce. to consider the recommendation of the secretary of the treasury made in his report to Congress, dated December S. 1905, to permit national banks to issue a volume of additional government guaranteed currency equal in amount to 50 per cent of the bonds-se- cured currency maintained by them, but subject to d tax of or per cent until redeemed.
 "Be it further resolved, That the com mittee on finance and currency submit report at the next monthly meeting of the chamber upon the aforementioned recommendation of the secretary of the treasury together with any other diff ferent measures which they may be able to suggest as efficient and practicable Tor the attainment of the purpose for which the recommendation of the secertary of the treasury has been submitted to Con- gress.''
 Strong Pressure to Sell. When the tenor of MT. Schiffs remarks became known in Wall street, the effect was shown almost instantaneousy in the stock market There was pressure to sell, and support to price seemed entirely lack ing resulting in an uninterrupted de- cline up to the close, which was active and weak. The shares most vulnarable were those which have been the leaders in the recent bull speculation, especially in metal stocks. Anaconda fell to 35I2 points below last night and rallied one. Other losses were:
 Amalgamated Copper, 3ss.
 St. Paul, 1A.
 Chicago and Northwestern, 9
 Delaware and Hudson, f.
 General Electric, 21s
 Great Northern. preferred, 3.
 Louisville and Nashville, 1A.
 Northern Pacific, ?.
 Peoples Gas, 114.
 Reading. ?.
 Virginia Carolina Chemical company, 21s
 These declines occurred in spite of the fact that call money while still firm was easier than for some days loans having been made as low as 8 per cent.
 After the close of the market Mir Schiff made this supplementary statement:
 Something Must Be Done.
 My remarks were dictated simply by the conviction that something must be done to correct our enelastic currency system if we are not to run into great disaster. We are trying to play the role of giants while still in our swaddling clothes.
 ..If the President could be made to see that this is a question of vastly more importance to the material interests of the country than that of railroad rate legislation to which he has devoted him self with such admirable energy, Congress would soon set at work to remedy our circulation evil in a manner which would safeguard our prosperity.
 MT. Schiff's remarks at the chamber of commerce follow:
 Condition Is Disgracefu.
 I've have witnessed during the past sixty days conditions in the New York money market which are nothing less than disgrace to any civilized country. There must be cause for such condi- tions It cannot be the condition of the country itself, for wherever you look there is prosperity-prosperity as we never had it before It is true that our prosperity may be contributory condi- ton. It cannot be that the speculation which prosperity always brings forward can be the sole reason for the condi- tions which we have witnessed, and are still witnessing. Other countries have had wider speculation than the United States. ''In France, Germany, in England. spec ulation apparent and probable. are ram pant at certain periods; and still you have never seen the money market for sixty days in such condition that rates have varied all the way from 10 to l25 per cent. I say that is disgrace to a civilized com munity. There must be a cause for 1t, and we all know the cause. The cause is in our insufficient circulating medium, or the insufficient elasticity of our circu- lating medium. Last year I went to the Secretary of the Treasury and said to him:
 The national banks are gorged with 0f deposits and prevent this condition, or
 
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