The Birmingham age-herald., 1914-09-12

called into operation by the effect of the new tariff law since the common business sentiment wa sthat the United States
 would adjust itself within two or three years at the most and without serious business disturbance to the new tariff schedule. Yet the leaders in the financial district have for two years been con sicous of some peculiar influence which
 they could not describe and of course could not identify. They felt 1t at the time of the Balkan war. Throughout the spring when exports of gold to this coun- try were unprecedented in amount this strange indescribabe feeling of anxiety grew stronger, although there was no public expression of it.
 | Still there were occasional hints that some emergenty might suddenly arise l which would entail great leadership and the mobilizing of the banking and iinan- l cial resources of the United States. l That suspicion became a. fact a day pr i two after war began. Then 1t was made apparent that the successors of the late | J. Pierpont Morgan were regarded still as l leaders. It was at their offices that the conferences took place which were fol- I lowed by the decision to close the stock exchange, thereby securing sort of vol 1 untary moratorium by which the payment | of obligations could be suspended or at | vented.
 1 It so happened that at this time New l Yokr city faces the payment of loaLs
 made abroad which were evidenced by l New York city notes that were issued 'n anticipation of taxes. In London such 1 negotiable instruments are called eX 1 chequer bills.
 | There was not at any moment ,he l slightest suggestion that New York city Rl | there were complicated and serious ob- staeles nthe way of providing funds l for meeting these obligations.
 | At last the finance officer of the city, 1 MT. Prendergast. found that the Morgan l house, in cooperation with the house oI l which Jacob Schiff is the head, and Paul ] Warburg, now of the federal reserve l board, was until a month ago /one of the partners, was ready to organize a syn
 dicate which would provide the funds, gold if necessary, or gold and foreign ex- change if that were more convenient. by which the city obligations could be met. Throughout the country and in London l this action is regarded as master stroke l of financial diplomacy. In the amount ii.- volved it is a greater transaction than l that which the late MT Morgan organized l for the purpose of protecting the federal l treasury against further drain of it's gold I | the city is of an unusual kind but that
 is because the circumstances are withou' l any precedent. Presumably the synuicate l which the Morgan house has organized | in cooperation with the private banking l house of which MT. Schiff Is the head vii 1 accept the offer of cooperation from the | banks of New York and will name to eacf of these banks the proportlonate part which it is to contribute to the general syndicate operation. As the senior Nor | gan, when making a contract with Pres ident Cleveland, accepted the risk of loss,
 so the contract which the present J. F. | Morgan and his associates have made with New York city compels the synds- cate to assume the risk of loss on the l transaction.
 But the action itself is spoken of Rs a 1 magnificent stroke not merely for New l York city, but for the re-establishmcnt of International credit, and upon the re-es- l tablishment of credit depends in great measure, the recovery of foreign ex- ! change.