New-York tribune., 1907-10-28
THE FINANCIAL MARKETS.
RE1SSURANCE At THE CLOSE or H WEEK or pm
ICKY CONDITIONS
The Relief Measures dopted Trust Company of Amccas Ordeal
Trust Companies nd Clearing House.
THE WEEK IN WALL STREET.

HE WEEA LIN WALL p4hLLA'
Wall Street has gone through many panics.
but rarely if ever which has equalled IN
seriousness and has been handled so ably ana
courageously as that of the week which has just
passed into financial history, for the worst now
appears definitely to be over, with the arrange
ments made for Importation Of gold IN quantity
and the decision of the Clearing House Asso-
citation to issue loan certificates, a plan under
which the resources of the associated banks for
meeting the needs of their customers are ma
terially enlarged, although a financial panic IS
not TO be terminated in day, and therefore it
IS not impossible that there may be announced
the suspension Of here and there a weak hnan-
cial institution. Only one Stock Exchange house
was forced last week to make assignment,
but many others might have been reduced to
the same extremity but for the pouring into the
exchange at a critical moment of the S20,0UO,0OO
Of pool money provided by J. p. Morgan & Co.
and seven of the great banks The Secretary OF
the Treasury spent four successive days at the
Sub-Treasury, and from there directed the relief
measures of the government, which included the
placing at the disposal of the depositary banks
for in coping with the grave situation Of
$250O0OOO of government moneys.
The impairment of confidence had begun as
result of the complications affecting the Henzc-
Morse-Thomas banks. III the preceding week.
following the collapse of the discredtable
United Copper corner, and at the beginning Of
the last week II was still uncertain whether or
not all of those institutions, although rid of
thelT former COntroulnS interests, would De ADle
10 make head against the pressure of suspicion
arising from their identification with those In
terests, although happily the purging of their
arrangements appears now TO have had the de-
sired beneficial effect When on Tuesday MORN
ing il was announced that the kniCkerbOCker
Trust Company had lost its Clearing House con-
nection and that its president had been obliged
TO Withdraw from his Office a run started under
which the institution within few hours found
itself obliged TO suspend payments. This deveI-
banking methods in the management Of the in
stitution gravely influenced the already ner-
vous public feeling, and it needed only the pub
LEGATION of indiSCTeet statement concerning
the position Of the Trust Company of America
to start the next morning a run on that institu-
ton which continued for four days, or until the
end of the week. in which period all claims pre-
sented were met. a remarkable record A highly
important incident Of that the circum-
stance that the trust companies Of the city, for
the first time in their history united in meas
ures for the relief of an associate, arranging 10
furnish to the Trust Company of America as
many millions as might be required TO enable it
TO pay in cash the last dollar Of its deposits, II
demanded.
As the news Of the heavy run the Trust
Company of America spread on Wednesday the
panicky feeling grew with great rapidity, and
was intensified by the news from Pittsburg that
four Westinghouse companies had been Obliged
to suspend. People began Withdrawing their
money from many institutions and boarding the
cash, a movement which during the week as
sumed larger proportions than ever before
known in this city; the banks, in order to be
able to meet the increasing strain upon them.
called loans in large volume. and on the Stock
Exchange prices crashed and the call money
rate touched 125 in the last hour of trading.
with many brokers unable to obtain at any rate
the funds necessary to enable them to carry on
their business. on the following day three
banks In Harlem. of Importance,
forced 10 close their doors. being unable TO oh
tain cash TO meet the Withdrawals by depositors,
and all over the greater city the drawing out
and boarding of money continued without ces-
sation. Union Pacific fell to par on the Stock
Exchange, and other standard issues declined
correspondingly, and the strngency of the
money market was such that funds were un-
obtainable, urgent call for help was made 10
Mr.. Morgan. The appeal was promptly met.
and the Morgan money pool, which had obtained
d considerable part Of the $25OO0OOO of gov
ernment money made available for the use Of
the banks by Secretary Cortelyou, rushed $25-
100000 into the board when money stood at 100
per cent.
The lending of this great sum saved the Stock
Exchange from Il situation Of the most extreme
peril In supplying it Mr. Morgan conveyed to
the members of the exchange distinct and en-
phauc stipulation that end must be made
to operations for the decline. and that the relief
given had been given for the sole purpose Of
enabling brokers to carry out their present
commitments, and under no circumstances for
the encouragement OF speculation Another
pinch occurred toward the close on the follow
Ing day and another appeal brought $1,000
ooV more from the Morgan pool which was dis
trbuted with the same warning On the latter
Gay eight banks and trust companies several of
them members Of a chain In BROOKLYN closed
thelr DOORS but none Of them was directly af-
mated with the important banks OF this bor-
ough, and the fact that the Trust Companv of
america was still meeting without dernur or de-
lay all claims, and seemed entirely likely TO
weather the storm, gave some reinsurance TO
the situation. The leading savings hanks which
mad all suffered heavy Withdrawals decided to
take advantage of the state law permitting them
10 require notice Of from one month to three
months 10 be given of Withdrawals OF deposits
ana by that step ended serious drain on the
banks from which they had been taking funds
Tor distribution among their own depositors
1helr decision was regarded as a wise one as
there could be no question of their soundneee
ana therefore their temporary suspension Of
payments, IN accordance with a law designed to
meet such emergencies as the present did moth
ing to intensity the popular apprehension. but
rather tended to allay it.
IL was on this day that signs of the end OF
lhe trouble began to be evident, when it became
known that gold engagements were under nego-
ualoh and that Clearing House certificates
HiisHI De issued, two measures which have al
ways been successful in breaking a panic Roth
oL tlese eNpedlents were carried into operation
on Saturday. Under the plan Of Clearing
Iiouse certificates, which is to be adopted in a
haf-dozen other cities as well as in New York
protection viii be afforded any member bank
winch may have suffered unduy from the timid-
lty or its customers; while by the Importation
ol gold, Of which S6,0O0,0O0 has already been
arranged to be brought in, with the prospect Of
many more millions this week. the cash re-
Sources Of the banks will soon be so large as to
sun enectually the apprehension of even the