Daily Kennebec journal. [microfilm reel] (Augusta, Me.) 1870-1975, 1907-12-31
CLEAR TALK ON PHILIPPINES
Most Notable Speech on Panic of 1907,
Causes, Effects and Connection With
the Administrations Policies.

ness investment which could not be
readily converted, but also by the
waste of capital in extravaganza OF
living and by the Spanish War, the
Boer War and the ussian-Japanese
War, and in such catastrophes as Bal
timore and San Francisco. 1t became
impossible for the soundest railroads
and other enterprises to borrow money
for new construction or re-construc-
ton. The condition extended the world
over.
Secondly, the conclusion can not be
avoided that the revelations of irreg-
ularities breaches of trust, stock job
bing over-iSsues of stock. violations OF
law and lack of rigid state or national
supervision in the management of
some of our largest insurance compan-
les, railroad companies, traction COM
panies and financial corporations
shocked investors and made them
withhold what little loanable capital
remained available. Such disclosures
had much more effect probably abroad
than they had here.
Wien, therefore, two or three insti-
tutions, banks and trust companies
supposed 10 be solid, were found to
have their capital impaired by stock
iobbing Of their officers. the public
was easily frightened and the run up
on banks began. The question then be-
came not one of loanable capital but
of actual money to be used in the
transactions of the day.
1t would seem that our system of
currency is not SO arranged as to per-
nit it's volume to be increased Temporal
rily to cOunteract the sudden drain of
money by the boarding in a panic. II
is probable that the Stringency which
reached its height on that dark day of
Oct. "a, might. in part. have been
alleviated, had we had currency
wricn could automatically enlarge it
self to meeting the tremendous de-
mand.
The injurious consequences to fol-
low from this panic are not likely to
be so long drawn out or to result in
such disastrous industrial depression
as the panic of 1893 or the panic OF
1875. In the first place we have solid
currency with no suggestion now of
departure from the gold standard
Our government finances are now in
excellent condition and we have a
large surplus. Our farming communi-
ties are prosperous and wealthy.
Again, the railroads. which make VI
a large part of the wealth of this
country, are on much solder founda :
ton than they have ever been in theiI
history.
Again, the balance of trade is with
U.s. We were able to settle for the
hundred millions Of gold that we with
drew from Europe in order to meet
in New York by the excess of our ex.
ports over our imports in the single
month of October.
All these things point to the proba.
| bility of restoration of confidence
and. after proper liquidation and ar
Industrial depression of some months
to resumption of business on n nor.
NAL basis.
Modern business is conducted on @
system of credit which in normal time.
increases the facility with which the
work of manufacture, production ant
sale can be carried on o thousand folt
| beyond the limit Of earlier days ant
enables a total of many billions to res
| on a very small percentage of actua
I money passed. Every manufacturer
| every merchant, is, under modern con
ditions, dependent in the successful
| conduct of his business upon banl
| CONTINUED from Page Ten.)