The Washington herald., 1913-12-06
WHEN BIG MEN
TALK OF PANIC

Copyright, 1915. by C. VI. Keys. New York
A great Jewish banker in New York,
talking at luncheon a little while ago,
ventured the opinion that unless cur
rency legislation, in proper form, goes
on the statute books very soon. We
shall get into very difficult conditions in
this country" 1t happened that this
same banker, in 1906, had made a speech
in which he deplored the imitation OF that
year, and said offhand that unless con-
ditions changed quickly We should have
in this country such a panic as will
make all previous panics look like child's
play"
The memory of the Wall Street market,
for anything evil or of dangerous i'm
port. is a very reteRtive memory. Peo-
pie who deal in large speculative under
takings in securities naturally have long
memories for matters like this. There
fore. the words of this banker ran quick
ly through the street In their fight. of
course, they gathered new meanings, and
by the time they had spread throughout
the speculative market they had assumed
the form of a direct statement that
financial panic will occur unless the ad-
ministration of the currency bill is put
into effect Immediately.
The banker in this case made haste to
correct the wrong impression that had
been taken from his words, and to state
that in his Judgment no immediate tinan-
cial panic was in sight. The incident
serves to illustrate the reason why men
in high positions are slow to speak of
panics Sometimes, after one of our
periodical disturbances, it transpires that
in some quiet speech or letter or writ
ing which circulated months before
among the professional dealers OF Wall
street. the head of this bank, or of that
trust company, or OF that great private
banking firm, had gone on record clearly
to the effect that disaster was imminent
The public always wonders why it is that
these men who saw so clearly what was
going to happen did not spread their
knowledge broadcast, so that the general
public could shape its course accordingly
and so that perhaps the catastrophe could
have been avoided.
The fact in the matter is that when
men feel the approach OF financial danger
in the market places, they are apt either
to keep silent altogether and simply
shape their own affairs to meet what
they expect to come, or else contine their
comment on the situation to people with
whom they are Immediately in touch.
Almost a year. before the panic of 1888
broke upon the world, an incident oc-
method of this inside exchange of opinion.
Mr.. E. H. Hartman had become, at
that time, a director OF the Illinois Cen
trail and was one of its influential direc-
tors. He was sick in bed when there
came TO him a record OF a meeting OF
the board of that road in which pro-
posal had come up to appropriate large
sum OF money for improvements and ad-
ditions.- Mr.. Hartman wrote, by hand,
a little letter of two pages in which
he expressed. in the strongest terms, his
most determined conviction that II was
no time to spend any money that did not
have to be spent and that in his judg-
ment the Illinois Central would have need
for all the resources which IL could COM
mand in the near future. That letter was
not intended for public. circulation and
never did circulate publicly. 1t was,
however, a clear enough expression OF
an established conviction in the mind OF
a financial expert with regard to con-
ditions that were to follow.
Similarly in the winter OF 1867 the
chairman of one OF the biggest banks
in this country wrote letter from Eu-
rope in which he warned the same Mr..
Hartman and his associates against car
rying on the campaign Of expansion and
imitation which seemed to this banker to
be under way. He expressed the convic-
tion that the growing antagonism to capi-
tai and the growing difficulty of getting
credit would lead to a catastrophe. rms
was all in a private letter which has
never been published
II by chance, either Of these letters had
become public property ~ the si;ne tney
were written, they might well have
served as warnings to the public Of some