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FINANCIAL REVIEW OF 1886. 



f aiDt and entirely unsuccessful attempt was made 

 to excite alarm, and even those capitalists who at 

 intervals in 1885 and in the early part of the 

 current year invested in sterling for safety, and 

 also to insure gold returns, abandoned these 

 investments during March. Unfortunately, 

 Congress did little toward restoring confidence 

 in the national finances. On the 8th of Janu- 

 ary, Mr. Eustice introduced a resolution in the 

 Senate proposing to pay with silver the $10,- 

 000,000 3-per-cent. bonds called on Dec. 29, 

 1885, for redemption, and this temporarily 

 had an unsettling effect upon the London mar- 

 ket for bonds, but this proposition was not 

 seriously considered by the Senate. Early in 

 February the House passed a resolution calling 

 upon the Secretary of the Treasury for an ex- 

 planation of the policy inaugurated by the de- 

 partment during the previous summer, but the 

 Secretary's reply was complete, and regarded 

 as satisfactory. April 8 Mr. Eland's bill, pro- 

 viding for the free coinage of silver was de- 

 feated in the House, but the vote showed that 

 this was the best that could be expected, and 

 that there was no hope, at least in that Con- 

 gress, for the repeal of the coinage act. In June 

 Mr. Morrison introduced a joint resolution in 

 the House requiring the Secretary of the Treas- 

 ury to call bonds, regardless of the condition of 

 the gold reserve! This resolution was sent to 

 the Senate, there amended by making such 

 calls discretionary with the Secretary, and it 

 was further amended by providing for the re- 

 demption of the trade-dollar; but, although 

 these amendments were concurred in by the 

 House, the resolution failed for want of the 

 signature of the President. After the middle 

 of the year until December the disturbances 

 resulting from the labor troubles subsided, gold 

 flowed hither from Europe, railroad earnings 

 improved, the crops were abundant, specula- 



tion in stocks and staples gradually increased, 

 money commanded better rates, thus causing 

 its withdrawal from boards and other deposi- 

 tories, and the outlook was encouraging for all 

 interests. Trading in stocks, however, seems 

 to have been overdone, with the usual results, 

 and in December forced liquidations of specu- 

 lative accounts, caused by active money and an 

 indisposition to loan upon a certain class of 

 collateral, kept the stock and other markets un- 

 settled during the greater part of the month, 

 and imparted a feeling of anxiety at the close 

 of the year, which was somewhat intensified 

 by a renewal of labor troubles in Brooklyn, 

 Pittsburg, and other cities, and more or less 

 important failures of business houses in various 

 parts of the country. The following tabular 

 survey of the economical conditions and results 

 of 1886, 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 

 1st of January, 1887, compared with prices at 

 the same date in 1886 and 1885, were as follow : 



The Money Market. During the first quarter 

 of the year bankers' balances were loaned at 

 the Stock Exchange at 1 and at 5 per cent., 

 averaging from 2 to 3, and in February loans 

 on commercial paper were made at very low 

 rates, such as 2 to 4J on four months' accept- 

 ances, 2| to 3J on 60 to 90 day indorsed bills 

 receivable, and 4 per cent, on some good single 

 names, while a fair grade of jobbers' paper was 

 done at 4 to 5| per cent. Trust companies 

 were then making loans on stock collateral, 

 running to the end of the year, at 4 per cent., 

 and banks were obliged to accommodate their 

 customers at equally low rates. The silver 

 question tended to drive capital into hoards, 

 thus largely augmenting the deposits of the 



Trust Companies and other institutions, and ii 

 their desire to place their money where 

 would be safe and at the same time earn fa 

 returns, investors drained the market of fii 

 class railroad securities, in some cases paying 

 prices which did not yield more than 4 per 

 cent. Others bought sterling for investment, 

 and still another class purchased real estate, 

 but very few put their money into manufact- 

 uring or business enterprises, being deterred 

 by the fear of a spread of the labor troubles 

 which early in March began to attract atten- 

 tion. Toward the end of the first quarter the 

 bank reserves were low, in consequence of 

 withdrawals of gold for shipment to Europe, 

 and also because of a demand from the interior, 



