The Salt Lake herald. [volume] (Salt Lake City [Utah]) 1870-1909, 1907-12-05
SITUATION FAST
CLEARING SAYS
SENATOR CLARK
Has Eastern AdviCeS Indicating
Early Resumption of Cash
Payments.
GIVES HIS VIEWS ON
COPPER SITUATION
SIX MONTHS SHOULD SEE SUR.
PLUS ELIMINATED AND MET.
AL ON 16-cENT BASIS.

Former Senator W. A. Clark Of Mon
tdna spent yesterday in the city in con-
sultatiOn with General Manager r. +.
wells, of the San Pedro railroad. Vice
President W. II. Bancroft of the Short
Line and other railroad officials. and Ieft
Ior Butte at l1:f5 p. m. During the even
ing he discussed for publication the latest
developments in the financial situation
and reviewed the copper market and its
prospects. 40
60, This isn't a panic" said the senator,
IN the ordinary meaning of the word
Inc people have been scared and some Of
lnem nave drawn their money out of cir
culatlon. but there is nothing in general
conditions approaching the panic STAGE
Inc people are not in financial distress
as they are in a real panic and business
Is good enough to show that the diff
cuIty IS only temporary. The trouble IS
lhaC our currency system is not adaptpd
TO our commercial needs. There should
pc some method Of providing about 500
WONO OF additional money when the crops
begin TO move, and retire this additional
currency when the crop movement is
over.
The same trouble arises every year at
ABOUT the same time, but this year IL
happened to coincide with wild financial
and speculative movements that ended i'm
disaster for the gentlemen involved. and
as "A result the depOsitOrs in New York
banks got scared and began drawing mon
ey out of circulation. When the New
York banks resorted to clearing house GER
tificates the whole country took the same,
method of protecting itself from an I'M
necessary crisis.
Situation Is Clearing.
I am sure the situation is clearing very
tdst. l received a letter today from the
vice president of one of the largest hanks
in New York. saying he had Just returned
from trip to Chicago, where he met the
clearing mouse members of that city and
also bankers from St Louis, Kansas City
and st. Paul All these bankers agreed
that the worst was over and that the re-
sumption of cash payments could be in
augurated very soon without trouble. You
see, we have received from Europe some
thing like S100000.O00 in gold That is not
borrowed money; il comes in payment for
cotton and wheat and copper, and that
gold VIII stay in this country. The bal
ance of trade is largely in our favor and
will be until the movement OF our prod
ucts abroad ends. Europe is buying our
securities for investment, which Is a
healthy sign, and the distribution ar
money westward has begun. 1t may pos
sibly be two or three weeks until cash
payments are resumed, but l would not
be surprised TO see it come sooner.
Naturally, after such a shock the re-
sumption of business will be cautious and
on a conservative basis. A good many
people have been doing too much bust
ness for the capital at their command,
and they will have TO slow up. Some big
enterprises will have to wait for their cap
ital before they can 90 ahead. The banks
will be slow to make loans on new ven
lures and in New York. now that the
weak spots have been eliminated from
the banking system. there will be no
more gambling ventures, nothing but solid
banking business. Altogether il NAV not
be bad thing for the country to get
down to normal methods again. and while
1 do not look for anything ike boom con-
ditions 1 feel sure there will be sub
stantial, satisfactory resumption Of pros
porous trade. The presidential year Is
always an uncertain quantity and that
may be a factor in the situation next
year but the country at large has too
much wealth, the farmers and trades
people are too prosperous and free from
debt for any serious, permanent depres-
sion to take place
Discusses Copper Situation.
Discussing the copper situation. Senator
Clark said the reaction in price was due
to the abnormal price established and
maintained for almost a year. Copper
he said, was put to &c cents, a figure
that was altogether too high and should
never have been established. It was held
there by the accumulation OF an enOr-.
nous surplus and encouraged the increase
of production by the big properties and
the opening of old mines until prOdue-
ton outran consumption. When con-
began to drop off the crash
came, as might have been fOreseen. IN
seventy-five days the metal dropped from
70 cents TO Y. cut of more than
nalf- NOW Montana mas reduced It's QUO
put 80 per cent, Arizona from 80 to %
per cent; the British Columbia mines have
either reduced or shut down entirely, and
a number of small mines have been COM
PEELED 20 close.
Heavy export sales have taken some
of the surplus, though part of the ex-
port is still held abroad and is in the
way of any immediate advance in price.
The Lake Superior mines have cut down
about % per cent and the total reduc-
ton I'm output is so large that six months
ought to see the surplus eliminated en-
tiTely. When that is done 1 expect to
see copper go back to about 16 cents per
pound and that IS enough. At that fig
ure consumption is possible on a large
scale and, while it will not enable all
the mines to resume on the old basis Il
will still furnish employment for a large
proportion of the men who have been
thrown out by the recent slump"
The senator spent some time in the Ne
Continued or Page 2.