The Topeka state journal., 1906-04-25
THE FINANCIAL EFFECT.

At first thought it would seem that
the almost total destruction of a city
like San Francisco at a loss aggregat-
ing several hundred million dollars,
would be a severe financial blow to
the Pacific coast, one from which it
would take a generation to recover.
AS a matter Of fact, owing to our mod
ern system of insurance and invest
ments, it Is likely that the work of re-
building San Francisco and its neigh
boring cities will be commenced, and a
year or two hence will see a greater
and better city by the Golden Gate
than ever before.
OF course much of the property de-
stroyed in San Francisco was insured,
and half Of the insurance was carried
by European countries, so that Europe
as well as America will contribute to
the rebuilding of san Francisco.
New York is somewhat fearful Of
the financial effect of the San Fran
cisco disaster, because it will mean
that a great amount of eastern and
foreign money will go west The New
York money market has been some
what tight for some time, and the de-
mand for money with which to rebuild
San Francisco will not help it any. It
is interesting to note what New York
thinks about it. Here is the view
taken by Henry Clews, the New York
banker, in his weekly financial review
on Saturday:
THE shock resulting from the San
Francisco calamity has been well re-
sisted by the stock market, but must
nevertheless in the long run exert a
depressing effect. The chief weight Of
the disaster Will fall upon an already
much strained money market Mil
lions viii be required to make good
the losses and for rebuilding the city;
considerable funds having already
been sent westward with more to fol-
low. As a result currency which ordf-
narily comes to New York during the
next few weeks will be retained at the
west and the chances for easier money
rates are still further diminished by
this catastrophe. San Francisco will
unquestionably be promptly rebuilt,
and on a grander 1nd more substan-
tia1 scale than in the past. The oppor-
tunities Of a growing commerce both
at home and with the Orient are alto
gether too magnificent and enticine to
be withstood. American enterprise
will quickly come to the rescue, and
San Francisco. like Chicago, Galveston
and Baltimore and Boston, will ere
long rise to a prouder position as
Pacific coast city than ever before. on
the stock exchange there was more or
less recession in values particularly
among the Pacific railways ana Pa
cific coast securities. The fear that
stocks may be freely and immediately
sold by insurance companies to meet
losses should not receive too serious
consideration Such losses are first
paid gradually out Of funds in bank or
by means Of temporary loans: insur-
ance companies not being in the habit
of sacrificing securities when it Is bet
ter financing to borrow. Most of our
Insurance companies are strong and
] perfectly sound institutions, and no
serious embarrassment to them are
to be anticipated. unless in one or two
possible instances. The losses upon
mercantile and Industrial establish
ments will, however, be heavy. and
possibly disastrous in some cases. The
occasion is one. therefore, that will
call for all the consideration ana pa
tience that our bankers and fnanciers
can extend toward a distressed com
munity. The California banks, al
though most Of their buildings have
been destroyed, will not lose the
money in their vaults. which aggre-