Santa Fe new Mexican. [volume] (Santa Fe, N.M.) 1898-1951, 1911-02-03
MONEY PANICS
IN UNITED STATES
They Are Most Likely to
Occur in the Spring
and Autumn
VARIATIONS IN THE MARKET
Seasonal Fluctuation Pointed
Out by National Monetary
Commission.


Washington, FeD. 3'--Aohey p"hies
in the United States are most likely
to occur during the stringent money
markets OF the "spring revival" or
3 the crop-moying season in the fall.
This is one Of the conclusions drawn
from an Investigation by Edwin Wal.
ter Kemmerer, professor of econo-
mics and finance at Cornell TDiver.
sity.
Professor Kemmcrer does not mean
TO declare that the seasonal strjngen-
cies are the causes of the rauios. but
that the months in which they occur
are the weakest links in the season
al chain. and that in periods OF ex-
traordinary tension the chain breaks
at those links.
Statistics of great value TO the stu
dent of monetary problems are made
available in a volume written by Prof,
! essor Kemmerer, just published by
/ the National Monetary Commission,
entitled. Seasonal Variations ir the
Relative Demand for Money and Capi-
! tai in the United States" 1t is a
statistical study, in which Professor
Kemmerer has gone beyond the range
of any previous investigation in that
important field. and on the basis Of
statistical evidence establishes many
facts hitherto obscure.
The object of the work, as stated
by Professor Kemmerer, 'is to throw
light upon the regularity and the ex-
tent of these seasonal variations. up-
on the degree to which our currency
and credit system responds to them.
and finally to show some of their
probable results upon more general
economic conditions as exemplified in
such phenomena as security prices,
commercial failures. and panics." The
study is based upon the nineteen-year
period. 1S9O-190S. so far as data for
this period is available The ma
Iterial for the larger number of tables
found in the volume was in part, Sc
cured by the Commission directly
from clearing house associations,
from individual bankers. and from
! public officials. 1t was also, in part,
, published in financial Journals.
In his study the author has looked
for the expression of seasonable
variations in the demand for money
r and capital in such market data as
, interest rates, bank loans, deposits,
] and reserves. domestic exchange
q rates and interior currency Ship
: ments, foreign exchange rates and the
. movement of gold, amounts of money
j, in circulation and clearings. His
method of using this data has been
:, to tabulate the figures themselves and
! also to construct an index number
!, for each figure. Then for the period
9 as a whole he has made first, a sim
H., pie average of the figures themselves
. and second. a simple ayerage of ths
index numbers.
Professor Kemmerer considers ir
O., turn the changes in the demand fol
moneyed capital in New York. Chi
cago. st, Louis New Orleans and San
Francisco. As the best available
8 criteria of this demand he has selec
- ted interest rates and the ratios Of
bank reserves to deposits from 1896
:. to 1908 studv of tbe data from
: New York CITY leads the author tc
the conclusion that there are five
neriods in New Works money market
First through Januarv tbore is 9
g rapid decline in the relative demand
- for money making tbe last mart n
- January and the fore mart Of Febru
ary a time of very cheap money Thi,
.s leasing IN" Professor Kenmore,
- states is due to +be fact that +he
- crop-moyine demand for money in thf
West and South has sDant it's force
- The cash is flowing back to New
- York CITY Among other causes he
=, mentions the natural reaction afte,
- the heavv strain on the money mar
- ket incident to January / settlements
The author puts the beginning O
the second period at about the mid
die of February, the relative demand
4, for money advancing rapidly toi ;
high level and maintaining it through
the fore Dart of April. The cause n
- this inward movement he finds in th.
&c by the low interest rates and tn,