Manchester Democrat. [volume] (Manchester, Iowa) 1875-1930, 1907-07-03
Past Panic. and Future one.

In looking back ut our Industrial
and financial history 1t is interesting
and may be profitable to know that
in 1881 there was great prosperity
and especially in New York City. The
diary Of Philips Hone, who was mayor
Of New York in 1926, describes that
prosperity as being beyond all former
examples, accompanied by high rents
vessels worth double, good prices fol
ample crops, in fact general prosperity
Two years later President jackson was
in the midst of his vigorous wal
against the United States bank monop
oily. Nicholas Biddle, the president OF
that bank, was the great "frenzied
fnancier" Of his day, and he not only
aimed to control the financial affairs
of the country but its politics also, fol
he attempted to defeat the re-nomina
ton Of Gen. Jackson in 1882 and the
nomination of Martin Van Buren, tic
be his successor. In 1888, Hone speaks
Of ill-advised action Of the President
In removing the government deposits
from the United States bank, which
he said produced an awful scarcity OF
money, stocks declined greatly ir
value, and in December of that year he
speaks of panic prevailing and as
times being "grayely hard" Gambling
in stocks, he says, has been carried
on by brokers to an extent disgraceful
to the character of the city," He
speaks of spectators selling stocks tc
the amount of millions without own
ing dollar of the stocks, betting il
would fall and then taking pains by
every kind of lying and chicanery tc
injure the reputation of the stock that
he may win." The Bears and the Wal
street of those days evidently had the
bulls by the throat and were making
them below for the time being.
But In the beginning of 1885 the
bulls were on top again and there was
renewed prosperity and speculation in
progress. Hone speaks of the high
prices prevailing for rents and com.
modities and the increased cost of llv.
Ing. 1.-THE rage for speculation In lands
in. Long Island" he says, ''is one Of
the bubbles of the Day" He tells us
of Abraham Schermerhorn rs having
farm of 40 acres, three miles from
Brooklyn, which he mad offered fol
$4,000 four years before and now sold
for 100000. Two years later, in 1887
however, the boom burst and lots
which sold at $3.50 were then worth
but $50. That was in April, and or
May 10, the New York banks had sus
pended specie payments.
There Is a great similarity between
those times and now. Andrew Jack
son was somewhat a prototype, OF
Theodore Roosevelt, they are both OF
the strenuous type and President
Roosevelt like Gen. Jackson, is hardly
satisfied without having a fight OIL
hand With some one. The parallel is
complete enough even to the fact that
both were mixed up in controversy
with ladies of great political ambition
for while Gen. jackson had his Peggy
iO'Neil;s President Roosevelt has ha6
his Maria In the Storer episode, only
there Is this great difference, for while
the chlvalrous Jackson stood by the
woman in the case, even to the point
Of disrupting his cabinet, President
Roosevelt felt compelled to denounce
the political activities Of Mrs. Storer.
Like the boom Of 1895 we have now
the same speculation In stocks, the
same land boom and high prices for
lots, the same greatly increased cost
of living and rents, except that to-day
everything is amplified by the enor-
nous Increase In population and
wealth and the resulting extravaganza
of the present time.
VIII the parallel hold good in the
collapse of the boom and resulting
depression in the price of real estate!
Will President Roosevelt be able to
name his successor to the presidency
as Jackson did with Van Buren,, af.
ter he had broken down the political
machine Of his party and created a
personal machine that he was able to
bequeath to his successor? Will Presi.
dent Roosevelt prevail, as Gen. Jack.
son did, or will the parallel be incom.
plete by the stalwart wing of the Re.
publican party controlling the next
Republican national convention.
Whether poor crops and tight money
will cause collapse Of the present
boom is impossible to say until the
crop question Is settled. We are now
doing business on a ten to one basis
that is the banks of the country only
hold 81 in cash for every $40 they owe
their depositors. 1t will not take
much to upset such an Inverted pyra.
mid and great many more things
may happen nowadays than in Gen
Jackson's time. There are indications
that the farseeing frenzied financiers
have sold or are selling their specula.
tive holdings and the retirement from
active business of such masters of
finance as j. P. Morgan and Rookie.
Teller and Rogers and Stillman looks
to be n warning for other. people to
take heed before the next financial
eruption occurs. OF course, when a
boom collapses somebody holds the bag
and these see their property melt away
in falling prices for lack of buyers
Those who are out of debt will wealth
.er the storm, If they can pay taxes
and get along with reduced incomes fol
awhile. But those who are in debt
when the pinch comes will suffer great
losses and many will lose their all.
We do not know that John Biddle
brought on the panic of 1888 to injure
the prestige of Gen. Jackson, but we
can well imagine the present dis
gruntled frenzied financlers allowing
the speculative markets to sag and
the Republican machine politicians aid
Ing them to defeat the Democrats as
they have done on former occasions
1t is comparatively easy to produce Q
rich mans panic" to brighten the yot-
ers by an appeal to their pockets.
Harvard View of the President.