The Washington herald., 1907-11-04

New York, Nov. 3.-Efforts that have
been made in recent weeks 10 draw a par
allel between current financial disturb
ances and those on famous occasions in
past years have not been very successful
A comparison between the events in Wan
street of the last two weeks and those Of
the troubles in 1884 has for a basis the
fact that at both times there was d notable
shortage OF currency; likewise the issue
OF clearing house certificates now recalls
the currency famine" in 1898. Otherwise
the condition Of affairs in these periods
was, totally different
In many ways considerable similarity
exists between the occurrences in the year
1871 and those in the present year. but
even in this case the parallel is meager
In lS01, as now, there had been a previous
imitation OF values. arising from an in
crease IN the worlds production Of gold.
Then. as now. there was a reign of high
prices for everything, a great extension
OF manufacturing enterprises. and pros
perity never before equalled among the
agricultural population.
Both years We're preceded by foreign
wars. which had enlarged the European
demand for our staple products. Here.
however. the coincidence ceases. The
striking feature of the panic OF 1857 was
that 1t broke out suddenly. and was i'm
mediately followed by an immense num-
Der Of business failures. The characters
tic of present affairs is that a steady and
tremendous decline has gone on for over
a year in security prices in Wall street,
with barely more than a perceptible trem-
or In the cOuntry's legitimate business
relations. and that IL has through its con-
stant tightening Of the rates for the use
Of money placed the entire business world
on guard
Crisis Not Reached.
II is fair to say, indeed, that the panic
Of 1907 has not been a crisis or depression
AT all in the strict sense Of the words. 1t
is true, Of course, that the issue Of clear
lng-house certificates in many leading
financial centers and among a large num-
Der OF smaller cities is now enforcing an
actual contraction OF business; and vet
even IN this regard the vast improvement
in conditions as compared with those of
former years becomes very apparent.
There are now no State banks. with
currency.
TO close their doors at the first symptom
Of trouble. There are no longer national
banks operating in a field solely by
themselves and compelled to defend their
solYenCy as a medieval baron defended
his isolated castle of old by their own
unaided efforts. The banking organiza-
ton Of the country now exists practically
as compact whole. 1t has put itself
= Of lot
10 meet all COmeTs; and the results are
apparent in state OF equanimity of the
public mind such as has never been pre-
sented before under like circumstances
in the past.
II is indeed in the stpdy Of these com
parsons between the past and present
that the greatest cause for encourage
ment regarding the business future is to
be found. One great cause of all finan-
cial and business depresSiOns in the cOun-
try in previous years has almost invari-
ably been an overextension OF the coun-
try's railway system. a building Of rail-
way lines into new and virgin territory.
and. In general, a development Of the
country beyond the demands OF trade.
Not Enough Railroads.
Now, and for several years back. the
one trouble that has confronted the rail-
way and business industries Of our coun-
try has been that Of getting money
enough to accomplish a development of
their business sufficient for the demands
of trade already brought into being
Again, in times OF so-called panic in the
past vital question has ever been that
concerning the security of the country's
circulating medium. Even as late as ten
years ago doubt existed as to the ability
Of the United States 10 redeem its paper
money in gold. and there was boarding
Of gold in consequence. To-day over
half Of the circulating medium of the
country is In the shape OF gold or gold
certificates. No other country in the
world is on so strong a basis in this