Graham guardian., 1907-11-15
NOVEMBER Is, 1907.
THE PARAMOUNT QUESTION

The topic of almost universal
discussion is the financial situation.
Every citizen has his idea as to
the cause of the present depression,
and the proper remedy to apply.
The causes attributed are as var
led as the colors of the rain bow,
and range from the fall of copper
to the meanness of Hartman and
Morgan. Amid such u confusion
of ideas, the true cause is probably
far from the general estimate, and
may in fact never be accurately
known. There is no denying the
fact, however, ths. the depression
has reached the country and is set
Ting down in good earnest. Just
why there should be a stringency
Is certainly mystery, in face of
the fact that crops everywhere are
good, industries have been -four
ishing, and there has been no war,
no famine, no drawing of money
out of the country, nor any other
cause that is manifest to the naked
eye. All that seems to be known
is that there was run on large
New York Trust company, which
is simply bank of little differ
ont form, and suddenly panic set
in as result thereof. 1t is true
the Trust company was compelled
to pay out twenty-five million dol
lars in oneor two days, but this
would have been scarcely deemed
sufficient cause for the entire fnan-
cial world to be jolted from its
equilibrium. The company was
compelled to close its doors, and
this started other "runs," until
three or four banks were also com.
PEELED to close. This alarmed the
bankers of New York, so they
called a meeting and announced
that they would not IN future ship
gold to outside banks, when called
upon to do so, even if the cash
was due the other banks. This
apnouncemept caused dismay all
over the country. Every bank in
the land feared a "run," and at
once took steps to ward off such
a disaster. In every city of any
size in the United States business
was put upon what is termed
clearing house basis, which simply
means that the business men are
required to accept bank checks in.
stead of cash when they go to the
banks to draw out money. The
same plan was also adopted IN all
tho smaller towns, and the country
from Maine to Texas and from
Seattle to Key West is working
on that basis. Here and there is
found bank which considers itself
strong enough to weather any
storm, but it is safe to say that
nine-tenths of the banks of the
nation are guarding their gold re.
serves in every way possible.
1t would ordinarily seem I'm.
possible for the stringency to be
either marked or long.continued.
The farmers of the country are
reveling in enormous crops, and
the people must buy them, because
they cannot stop eating. The gold
and silver mines are turning out
their usual supply of the precious
which is lways esteemed
to be an antidote for hard times.
The varied industries of the land
are working full blast, and while
they are paying their employees
generally with small checks, these
pass as gold in business circles, so
it makes no difference to the work
ingmen. People must continue to
live and therefore to buy, and it |
would seem that business must
continue in much the same way as
usual.
The situation affords much food
for thought for the student of po.
Iitical economy. Whence came
he depression? Is it the symptom
If some deep-seated financial trou.