The Farmington times. (Farmington, St. Francois County, Mo.) 1905-1926, 1907-04-26
FRENziED FINANCE.


The director of the United States
mint in his recent review OF monetary
expansion and its effect upon prices
and Industry, brings out the fact that
the last statement of the national
banks shows that the cash reserve
averages only about one dollar to each
ten dollars of deposits. That Is a very
startling fact, for II shows that II de-
positors were TO withdraw one-tenth
Of their balances IL would take all
the money the banks have, and at
once produce disastrous panic. He
therefore concludes that credit is ex-
banded to the limit" and believes that
TO save the country from financial dis.
aster a contraction of speculative ac-
tivity is necessary. The history OF
other such periods OF speculation in
dicates that the boomers will not let
up until crash forces them to. But
Mr.. Roberts also tells MS that the
worlds production of gold for the
past year exceeds 100000 900 and ls
increasing at the rate of over $25,OOO,-
WV a year anu INC uHhual plNhuNNiSh
has more than doubled during the past
ten years. As long as this gold eSpan.
sion continues prices will continue to
rise and unless our spectators great
ly oyerrun their credit there should
be no smash up" though there viii
undoubtedly occur periods of depres-
sion due to over activity.
A London Economist writer takes
most pessimistic view Of the danger
Of the increase in prices and declares:
Unless the prices OF commodities
cease to rise, II is TO be feared that
the present crisis will not pass away,
and II the rise continues, the position
may easily become so acute that all
the chief banks OF the world may find
IL necessary TO take yet more stcrnly
defensive measures to avoid a very
serious and worldwide calamity"
There Ia no doubt that the enormous
~ increased cost OF commodities
sc per cent on the average-requires
much more money to carry on the
business OF the country and keeps n
much larger amount of cash in crlcu
lation in the hands Of the people. This
increase in prices has been accentuat
ed by the advance In the market price
Of securities on the Wall street stock
exchange and elsewhere, mainly due
20 the clique control of railroads and
other corporations and the frenz!e6
financing by the Wall street specula-
tors We have n glimpse OF this In the
evidence given before the interstate
commerce commission Of the Harri.
man stock dealings with the surplus
OF the Union Pacific and other rail-
roads controlled by the same inter
ests. We know that hundreds Of mil
lions OF dollars that have been wrung
from the people through unreasonable
railroad rates have been tied up in
vast stock exchange deals in which
Hartman, Rockefeller and others are
Interested. instead Of the money find
Ing its way into the channels OF legiti-
mate business.
The operations Of the United States
treasury under Shaw and approved by
president Roosevelt have been help
ing these frenzled financiers by de-
posting in national banks all the
available money in the treasury with
out even charging them interest. And
the enormfty OF these transactions is
made worse by the fact that the in.
terest rates on money In Wall street
has averaged over 10 per cent during
tho mast three months