FINANCIAL REVIEW OF 1888. 



323 



comparatively undisturbed by the demands of 

 labor organizations. The fact was early rec- 

 ognized that Congress would make an at- 

 tempt to revise the tariff, and the uncertainty 

 which existed regarding the final action of that 

 body upon this subject induced manufacturers 

 of articles likely to be affected by changes in 

 the tariff to restrict their operations and to con- 

 fine the production so far as was possible to 

 current needs. It was not until after the presi- 

 dential election that there was any important 

 activity in manufacturing of good's, and then 

 only in woolens. The production of cottons 

 was large and the mills generally did a profit- 

 able business. The output of pig-iron was 

 about (5 per cent, below the large production 

 of 1887, and the decrease was most marked in 

 Bessemer pig. The manufacture of structural 

 iron and steel, however, was greater than in 

 1887 or in 1886. The product of the Tennessee 

 and Alabama iron-manufacturing districts was 

 a striking feature, as also was the new process 

 of the petroleum jet blast for the manufacture 

 of iron and steel, which, it was claimed, would 

 greatly reduce the cost of production. The 

 output of anthracite coal was the largest on 

 record, and schedule prices were generally 

 well maintained until December, when de- 

 creased consumption and an accumulation of 

 stocks caused a slight reduction. 



The Money Market. Money on call, repre- 

 sented by bankers' balances, ranged from 10 

 to 1 per cent, during the year. The 6 and 7 

 per cent, rates were in January, on March 2, 

 and on October 3, due, on the last named day, 

 to large withdrawals for the West and also by 

 the customary demand for settlements. In the 

 last two weeks of December, 8 per cent, was 

 recorded, and on tbe last day of the year 

 money loaned at 10 per cent., but then the 

 demand came from belated borrowers in the 

 absence of representatives of lenders. Scarce- 

 ly anything was done in time-loans in stock 

 collateral until toward the close of January 

 when there were a few transactions at 4J 

 per cent, for six months and 4 for sixty 

 days. Rates grew easier early in February 

 and contracts were made at 3 per cent, for 

 sixty days to four months, and 4 for six 

 months, but toward the close of February 

 rates were firmer at 4 to 5 per cent, for ninety 

 days to four months and 5 to o for six 

 months, the expectation then being that bank 

 reserves would be materially reduced by Treas- 

 ury operations. These rates ruled quite uni- 

 formly throughout March, becoming slightly 

 easier toward the close, but early in April, 

 under the influence of offerings of foreign 

 money on call and on time, rates fell to 3 to 

 3 per cent, for sixty days to four months and 

 44 to 5 for six months to the end of the year. 

 After the Secretary of the Treasury com- 

 menced to buy bonds, thus insuring ease in 

 money, the offerings were liberal but the de- 

 mand was not urgent, borrowers being satis- 

 fied that they could procure all needed accom- 



modation in the call-loan branch of the market, 

 where the rate gradually fell to an average of 

 2 per cent. In May the exports of gold en- 

 couraged lenders to Lope tLat they could do 

 better later in the season than by offering 

 money at the then low rates, and many of 

 them withheld their offerings on time and em- 

 ployed their funds in the call-loan market, but 

 the demand was comparatively insignificant 

 and the smaller supply had no effect upon 

 rates. Early in June time-loans were quoted 

 at 2 per cent, for ninety days, 3 for four 

 months, and 3 for the remainder of the year, 

 and toward the middle of the month the rate 

 was 2 per cent, for sixty days. In July some 

 foreign money was placed for about four 

 months' time at 1 to 2| per cent, on strictly 

 prime collateral, and this forced domestic lend- 

 ers out of the market temporarily. By the 

 close of the month, however, quotations were 

 2i to 3 per cent, for sixty days, 3 for ninety 

 days ; 3 for four months, and 4 to 4 for four 

 to six months. Early in August there was a 

 slight advance in the call-loan rate, due to 

 withdrawals of funds for the West, but before 

 the close quotations fell off again, influenced 

 by the light inquiry for time-loans which 

 caused lenders to employ their money on call. 

 Then quotations were 2 to 3 per cent, for 

 sixty to ninety days ; 3 to 3 for ninety days 

 to four months ; and 3 to 4 for four to six 

 months. By the middle of September rates 

 were 5 per cent, for four, five, and six months, 

 but very little was done and there was then an 

 impression that rates would become still easier 

 by reason of a return of funds from the West. 

 During the first few days in October call-loans 

 advanced to 7 per cent., partly in consequence 

 of withdrawals for the monthly settlements, 

 but mainly because of a drain of money to the 

 West, it being attracted thither by the wild 

 speculation in wheat. Time-loans were then 

 quoted at 4 to 5 per cent, for four, five, and 

 six months, but they were not in demand, and 

 toward the close of the month, under the in- 

 fluence of offerings by bankers with foreign 

 connections, the rate fell to 3 to 3 per cent, 

 for the remainder of the year and 4 to 5 for 

 four, five, and six months. Call money had by 

 this time gradually declined to an average of 2 

 per cent. Early in November many of the 

 banks and trust companies, finding time-loans 

 unremunerative and commercial paper scarce, 

 bought freely of railroad mortgages taking 

 anything that would yield above 4 per cent., 

 but later in the month there was a good in- 

 quiry from almost every quarter for time- 

 loans, based upon the expectation of an active 

 demand for money for manufacturing and 

 business enterprises, and rates moved up to 3 

 per cent, for sixty days ; 4 for ninety days to 

 four months ; and 4 to 5 for four to six months. 

 Call money ranged from 4 to 2 per cent. In 

 December lending on time was practically 

 confined to a few of the city trust companies 

 and to out-of-town institutions and the de- 



