The Mankato free press. [volume] (Mankato, Blue Earth County, Minn.) 1879-1924, 1907-11-15
MORE CHEERFUL TONE.

Henry CleWS writes more cneeIlully.
He says much better feeling exists
in New York owing very largely to
two circumstances; first the engage
ment of over $43,OO0OOO of gold and
second, the saving of two big trust
companies from suspension. Other fac
tors also tended to give relief, such
as the clear-headed control of the
situation exercised by strong financial
leaders, and the timely assistance rem
dered by the government at Washing
ton. In consequence of these develop
ments the security markets, though
quiet have shown a substantial re-
covery, thus materially facilitating the
liquidation which has been ecessary
in various quarters. While the strain
upon New York has thus been modera-
ted and the crisis apparently passed
without further diaster. The financial
pressure has spread to all parts of the
country with varying severity. In all
of our principle cities the monetary
stringency, though less acute than IN
New York, has been exceedingly pro-
nounced, calling for similar methods
of relief to those adopted IN tins
CITY. The situation, moreover, was seri-
ously aggravated by the disposition of
the public to hoard currency; but this
evil. which is a feature in all panics,
is gradually disappearing and the ship
of finance, though badly crippled by
the recent storm, is emerging In much
better condition than anticipated.
Now that the worst is over, the
universal question asked is, what must
be now expected All previous panlcs
show that after the acute stage of
crisis was passed a substantial recovery
followed on the Stock Exchange, to
be succeeded by a period of more or
less inertia and depression. There Is
| no reason to anticipate any departure
from this rule in this panic, although
the conditions are not precisely similar
to those of previous crisis. The one
saving feature in the situation is the
general soundness of our banks These
institutions, though in the past not
not always managed on the lines OF
strict prudence, are now as whole
eminently sound and have endured the
tremendous strain of the last lew
weeks in splendid fashion. Dishonest
management has been thoroughly ell
minated from our banks and rail
roads and ii is safe to say that sound
-
prevalent in these institutions thap
today. There is no reason for dlstrust
in this quarter The weakest element
in the financial field has been amongst
the trust companies which had entered
the field of banking in competition
with the banks, but without the re-
strictions and safeguards of the latter
A breakdown in this quarter has long
been expected, and one important adj
vantage from recent experiences will
be that in the future all trust COM
panies will have to be managed on
sound and conservative lines.
The effects of the financial distur-
) bance are now extending into the
commercial world For elf-protection
the banks are compelled to materially
restrict their credit operations. Many
business concerns will consequently
have much difficulty in renewing obi
cations, and business will naturally
be compelled to contract more or, less
i'm accordance with the destruction OF
credit. How far this contraction vii
90 and with what consequences it Is
impossible to predict, but the sooner
, the fact is recognized that genera
business must take its share of The
present depression which has fallen up
on Wall street, the better for all con
) cerned. Everything possible should nov
: be done to rebuild confidence and ere
dit. Hoarded money should be restored
to the banks in order to enable then
: to better grant the accommodation
which it is their business to furnish. i
: is sheer folly to take money out o
2 the banks and hide it in stockings o
safe deposit boxes. If depositors ar
unwilling to invest their funds the,
should put them in sound bankin:
e institutions, of which there are plenty
g and not deprive the community o
the life blood of commerce. Let thes
: boarding be put back into the banks s.
: that the latter can exercise their legi
S innate functions of giving credit, an
recovery will be quickly expedited.
r Gold imports will do much to reliev
S the situation, and the further expan