FINANCIAL REVIEW OF 1885. 



349 



ward recovery, European nations had suffered 

 from domestic dissensions and foreign compli- 

 cations, and although the situation abroad was 

 less strained in this respect at the close of the 

 year, the war-clouds were by no means entire- 

 ly dispelled. Financial and trade depression con- 

 tinued, with, unfortunately, but little prospect of 

 immediate relief, and the outlook was in many 

 respects greatly discouraging. The summer of 

 1885 witnessed a larger concentration of capi- 

 tal in banks, placed there simply for safety 

 and because of inability to employ it, than 

 ever before known. An idea can be formed 

 of the vastness of these deposits by the state- 

 ment that in the banks of England, France, 

 and Germany there was an accumulation, on 

 or about July 1, of 81,633,835, equal to about 

 $408,169,175, while in New York city alone 

 there were in the associated banks $116,346,- 

 200 of gold and its representative. The depos- 

 its in the London joint-stock institutions were 

 so large that only nominal rates of interest 

 were allowed ; discounts of sixty-day to three- 

 months' bills were made at one half of one per 

 cent., and short loans were one fourth of one 

 per cent. This accumulation of capital was 

 partly due to the stagnation in trade and specu- 

 lation, in part to the unsettled political situa- 

 tion in Europe, and also to the distrust arising 

 from the silver question, and it is possible that 

 the latter was really the most potent influence 

 in producing this financial inactivity. The 

 nations in the Latin Union were in midsummer 

 conferring as to the further continuance of the 

 compact; India was beginning to feel the press- 

 ure of the silver sent thither from China ; India 

 Council bills became so plentiful, in consequence 

 of government operations between that coun- 

 try and England, that they steadily declined, 

 thus depressing the market value of silver and 

 therefore depreciating the bullion and foreign 

 value of all these coins, and embarrassing the 

 finances of those countries having a redundan- 

 cy of this class of coinage. It is therefore 

 reasonable to conclude that gold was accumu- 

 lated by many of the European nations through 

 fear of possible disturbance resulting from a 

 plethora of silver, and that this will in great 

 part account for the concentration of gold in 



the principal financial centers. The decision 

 to extend the Latin Union was not reached 

 until November, and even then Belgium did 

 not give her assent to the agreement, and it 

 was not until December that she signed the 

 compact. But this simply provided for liqui- 

 dation and the marketing of the surplus silver 

 coins of each country, and for that reason did 

 not increase the consumption of the metal. 

 Gradually the market value of silver declined^ 

 after July, to 47| pence an ounce in Septem- 

 ber. Then followed a fractional recoverv ; 

 but by the middle of December the price felfto 

 46 J- pence; the demand almost wholly ceased, 

 and dealers and speculators awaited with some 

 anxiety the action of Congress upon the meas- 

 ure to repeal the coinage law of 1878. The 

 President in his message, and the Secretary of 

 the Treasury in his report, ably advocated' the 

 passage of such a bill, and nearly all the com- 

 mercial organizations of the country memorial- 

 ized Congress in favor of early action. Through 

 the skillful management of the Treasury De- 

 partment and the co-operation of the banks of 

 this city that derangement of our finances 

 which would have resulted from the enforced 

 circulation of the silver dollar has thus far 

 been prevented, but this is no guarantee that 

 success will continue to attend these efforts if 

 the coinage is not stopped, and hence the anx- 

 iety of the commercial and banking interests 

 to secure a repeal of the law. In all probabil- 

 ity the price of the metal has already fallen 

 quite as low as it can be expected to decline in 

 the event of a suspension of its further coinage 

 into dollars, and therefore the silver -mine 

 owners of the country can not sustain severe 

 losses ; but even if they should, the benefits to 

 our business, industrial, and other interests, 

 which would certainly follow the repeal of the 

 law, would be so important and permanent as 

 entirely to outweigh the comparatively insig- 

 nificant damage that might be caused by a 

 temporary depreciation in the market value 

 of silver. The following tabular survey of 

 the economical conditions and results of 1885, 

 contrasted with those of the preceding year, 

 is from official returns, and also from the 

 " Commercial and Financial Chronicle " : 



The prices of leading staples on or about the the same date in 1885, 1884, and 1883, were as 

 1st of January, 1886, compared with prices at follow: 



