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FINANCIAL REVIEW OF 1896. 



ccpt so far as the causes may suggest the partial 

 cure of the evil. The tremendous development of 

 Western railways, especially the building of the 

 transcontinental systems, immediately after the 

 civil war, opening" vast fields of cereal and live- 

 stock production, and shifting the center of distri- 

 bution, was the original disturbing factor. Inci- 

 dental to the influence, involving loss of revenue 

 to the Kastern farmer, was the loss of the old in- 

 tensely thrifty, conservative spirit that made the 

 farmer's family content with a parsimonious living. 

 The new spirit of the times opened unknown vistas 

 of pleasure and comfort in living, which the old 

 life could not gratify. These two main causes as- 

 sisted by other minor influences, drained the agri- 

 cultural sections of the East of the more ambitious 

 growing generation, and still continues to do so. 

 A possible remedy may be suggested by the study 

 of these causes. The farmer cut off from profitable 

 production of the great staples, hay alone excepted, 

 must learn to mix brains with his farming, and 

 study the markets that are left to him, with a view 

 to their supply. Eggs, butter, cheese, milk, poultry, 

 winter roots and similar products, and general 

 market gardening, when sufficiently near to popu- 

 lous trade and manufacturing centers, offer annually 

 increasing outlets for remunerative toil. The 

 farmer in the East must change his methods and 

 become free of the old ruts. The social difficulty 

 may be largely decreased by good roads, convenient 

 alike for business and pleasure, and practically 

 bringing families near to each other for the pur- 

 poses of society and the producer near his shipping 

 station. The subject of good roads has been greatly 

 mooted of late years, and some steps have been 

 taken to secure them. In a report to the New York 

 Legislature four years ago it was estimated, as a 

 conclusion based on careful study, that an adequate 

 system of macadamized roads would add 25 per 

 cent, to the value of agricultural property in the 

 State. A similar appreciation, if not so great a 

 one, would take place in all the agricultural sections. 

 The necessity of scientifically built roads must be 

 accepted as a prime factor in all schemes for the 

 regeneration of farming interests. That the older 

 agricultural regions, especially the more sterile 

 sections, can ever be restored to their former im- 

 portance in the general economic scheme is scarcely 

 possible. But very much may be done by intelli- 

 gent private and public effort to check the retro- 

 grade tendencies that have been operating power- 

 fully for many years. 



FINANCIAL REYIEW OF 1896. The presi- 

 dential campaign of this year was an important 

 disturbing factor, unsettling all financial, com- 

 mercial, and industrial enterprises for nearly three 

 months, and it was not until the election that there 

 was any recovery. Then confidence was restored, 

 and there was a decided improvement in the gen- 

 eral situation, which continued to the end of the 

 year. There were indications in May that the 

 Democratic National Convention, which would as- 

 semble in Chicago, July 7, would be dominated by 

 delegations in favor of the free coinage of silver, 

 and some fears were entertained that the Repub- 

 lican National Convention, to be held at St. Louis, 

 June 16, would fail to take decided ground in favor 

 of the gold standard. All doubt regarding the at- 

 titude of the Republican party was dispelled by the 

 adoption of a sound money platform, and William 

 McKinley, of Ohio, and Garret A. Ilobart, of New 

 Jersey, were nominated for President and Vice- 

 President. But as the time approached for the 

 meeting of the Democratic Convention it became 

 evident that the free-silver-coinage element would 

 be largely in the ascendant. The conservative 

 members of the party sought to avert the catas- 



trophe, but without avail, and the platform adopted 

 not only declared in favor of the free coinage of 

 silver, but it contained resolutions assailing the 

 courts for their interference by injunctions at the 

 time of the Debs insurrection in 1894; declaring 

 against life tenure in the public service ; opposing 

 further issues of Government bonds for the purpose 

 of maintaining the gold reserve ; and demanding 

 that holders of Government obligations should be 

 deprived of the option now enjoyed of choosing the 

 kind of money in which they chould receive pay- 

 ment. The platform was adopted by a vote of 628 

 to 807, and William J. Bryan, of Nebraska, and 

 Arthur Sewall, of Maine, were placed in nomina- 

 tion for President and Vice-President. The Pop- 

 ulist [tarty met in St. Louis, July 22, and nominated 

 W. J. Bryan and Thomas A. Watson, the latter of 

 Georgia, while the silver convention met later in 

 the month and nominated Bryan and Sewall, and 

 in September the sound-money Democrats met in 

 Indianapolis and nominated Palmer and Buckner. 

 Immediately after the action of the Democratic 

 Convention at Chicago a feeling of distrust begun 

 to grow ; prices at the Stock Exchange were de- 

 pressed ; gold was drawn from the Treasury for 

 shipment to Europe and to Canada; savings-bank 

 deposits were withdrawn, converted into gold, and 

 the metal was hoarded; commercial failures in- 

 creased ; business and industrial enterprises were 

 paralyzed ; capital sought retirement ; and the finan- 

 cial situation grew grave. There were periods of 

 recovery from the depression as the canvass pro- 

 gressed, due to a more hopeful feeling regarding 

 the result of the election, but during October fears 

 of the possibility of the success of the Democratic 

 ticket stimulated further hoarding of gold ; the 

 demand for the metal caused an advance in the 

 premium of from |- of 1 to 1 per cent, for spot, and 

 from 1 J to ! per cent, for options deliverable in No- 

 vember and December, which premium led to the 

 import of gold from Europe; sterling exchange 

 was largely bought for insurance against loss in 

 case of the election of Bryan and Sewall ; money 

 on call gradually grew stringent ; loans for fixed 

 periods could not be obtained except at high rates ; 

 contracts for goods were made conditional upon the 

 success of Mr. McKinley, and for at least ten days 

 before the election nearly all financial, commercial, 

 and industrial interests were in a state of partial 

 stagnation. The stock market was, however, com- 

 paratively strong, owing to speculative manipula- 

 tion. The election resulted in the success of the 

 Republican national ticket, which received 271 

 electoral votes against 176 for Bryan and Sewall. 

 and there was an immediate restoration of con- 

 fidence. Money grew easy ; the premium on gold 

 vanished; hoards of gold and of currency were 

 released; capital sought employment: business re- 

 vived ; industrial enterprises were resumed : the net 

 gold in the Treasury increased ; the loans, cash, 

 and deposits of the banks were rapidly augmented ; 

 and prosperous conditions generally prevailed. The 

 significance of the victory for sound money was 

 shown by the fact that the- popular plurality of 

 725.448 was the largest given at any presidental 

 election since 1872, when Grant's plurality was 

 762.991 : and all the Eastern, the Middle, and Mid- 

 dle Western States, the most populous and the most 

 wealthy sections of the country, gave Mr. McKin- 

 ley decisive majorities. The victory resulted from 

 a phenomenal uprising of the people, regardless of 

 party ties, who voted for the Republican candidate 

 because he represented the principle of sound money 

 and of good government as opposed to a debased 

 silver currency and revolutionary methods. 



Among the important events in Europe more or 

 less influencing the financial situation were the 



