FINANCIAL KEVIEW OF 1886. 



333 



ever this incubus was removed and with the 

 revival of these industries and the establish- 

 ment of more harmonious relations between 

 capital and labor it was hoped that general 

 trade would be more profitable in the next 

 than it had been during the current year. No 

 attempt was made, however, to conceal the 

 fact that a great deal depended upon harmony 

 between the employer and the employed. It 

 was evident that if the latter intended to insist 

 upon dictating rates of wages, hoars of labor, 

 and methods of management, and, moreover, 

 proposed to interfere with or prevent the em- 

 ployment of persons willing to comply with 

 salutary rules and accept such compensation as 

 could be afforded, the friction between labor 

 and capital would become so great that combi- 

 nations of employers would have to be con- 

 tinued, where already formed, or organized, in 

 cases where such organization had been de- 

 ferred in the hope of accomplishing peaceful re- 

 sults by less harsh measures. The strikes early 

 in the year among men employed in the manu- 

 facture of fabrics resulted in compelling the 

 owners of the establishments to curtail their 

 output, and in some cases the orders for the 

 goods were transferred to Europe. The de- 

 mand of workmen on clothing for higher wages 

 and shorter hours came at a time when refusal 

 would be ruinous to contractors, and, after the 

 work in hand had been done, no more engage- 

 ments were made, except with the proviso that 

 they should be canceled if work was interrupt- 

 ed by labor-strikes. The knit-goods, boot and 

 shoe, carpet, building, furniture, and almost all 

 kinds of trades were at intervals suspended or 

 interrupted during the year by disagreements 

 of greater or less magnitude between employ- 

 ers and employed and these suspensions or inter- 

 ruptions induced such caution among the deal- 

 ers in the articles affected as very materially to 

 limit the volume of business and greatly reduce 

 its profits. Unfortunately, there was little at 

 the close of the year to encourage the hope that 

 the lessons taught by the failure of the labor 

 demands would prevent their repetition. On 

 the contrary, it was feared that the various or- 

 ganizations throughout the country would se- 

 cretly prepare for another effort to enforce 

 their requirements, and, at an inopportune mo- 

 ment, precipitate a movement which would, 

 temporarily at least, have a paralyzing effect 

 upon all branches of trade and manufactures. 

 While our troubles were confined to those re- 

 sulting from labor-strikes in manufacturing es- 

 tablishments and on railroads, European coun- 

 tries had the almost constant menace of the 

 Eastern question which in one form or another 

 first on the Afghanistan frontier, next in 

 Greece, and finally in Bulgaria kept political 

 affairs in a state of tension, and at times, when 

 outbreaks were threatened, deranged the finan- 

 cial affairs of the principal business centers. 

 For the first half of the year England was in a 

 state of expectancy over the Irish question. 

 The defeat of the Gladstone ministry on the 



issue of home-rule ended the suspense, and 

 thereafter domestic peace was interrupted only 

 by the agitation of a few malcontents. The 

 finances of Europe were kept in a condition of 

 uncertainty by the efforts of each nation to get 

 more gold and retain its possessions of that 

 metal, and early in the year France succeeded 

 in drawing from all the nations of Europe and 

 also from America an amount sufficient to en- 

 able her successfully to float her loan of 1,446,- 

 000,000 francs. After this Germany com- 

 menced to absorb the metal, drawing it from 

 London, Paris, and America, but this move- 

 ment, as was explained toward the close of the 

 year, was caused by sales by Germany to the 

 Egyptian Government of its stock of silver bars, 

 amounting to 2,267,232 troy ounces, and of 

 1,143,000 marks of silver coin. During the 

 first six months of the year the United States 

 sent to Great Britain, France, and Germany, 

 $29,494,110 in gold. The import movement 

 which commenced in August resulted in the 

 receipt of $34,723,067, the principal part be- 

 ing taken from France. The sales of silver 

 by Germany will in part explain the cause 

 of the fall in the price of the metal in Lon- 

 don from 47 pence per ounce, at the begin- 

 ning of the year, to 42 pence July 31, and the 

 subsequent recovery to 47 T V pence November 

 19 was partly due to the appointment of a 

 British commission to inquire into the relative 

 values of gold and silver, and in part to pur- 

 chases by France in London and New York of 

 bullion amounting in value to about 7,000,000 

 francs, for coinage into money for circulation 

 in Tonquin. The anxiety that was felt early in 

 the year regarding the ability of the Treasury 

 Department to maintain gold payments of its 

 balances at the Clearing-Houses was allayed, 

 first by the settlement of such balances with 

 gold instead of partly with United States notes ; 

 and, secondly, by the exhibition of the results 

 of the policy adopted by the department of is- 

 suing silver certificates in exchange only for 

 the coins, and thus reducing the volume of 

 such certificates. The reports of the Treasurer, 

 showing monthly receipts at New York from 

 customs, indicated, as the result of this policy, a 

 reduction in the percentage of silver certificates 

 received, from 23f in July, 1885, to 8| in Feb- 

 ruary, 1886, while the receipts of gold certifi- 

 cates had increased from 28-f in July, 1885, to 

 60 in December, and United States notes had 

 been augmented from 16 T 9 7 in October, 1885, 

 to 84f in July, 1886. These changes aided in 

 increasing the net gold balance of the treasury 

 from $136,086,610 January 31 to $156,793,749 

 June 30, and to $163,930,220 by Nov. 30, 1886, 

 although during the calendar year $127,000,000 

 bonds had been called, and nearly the whole 

 redeemed. While the market price of silver 

 was steadily declining in London, thus reduc- 

 ing the intrinsic value of our coins, we were 

 freely exporting gold to Europe, but confidence 

 in the wise administration of the national 

 finances was apparently so great that only a 



