FINANCIAL REVIEW OP 1893. 



had been sent to Germany and $15,900,000 to 

 i'Yaiu ( for tln> account of the bankers who were 

 under engap'm.-nt to supply Austro-Ilungary. 

 The net gold in tin- Treasury was then $ 103,- 

 884,818, winst *108, 181,714, Feb. 1, and $121,- 

 L'Oijjiii'J, Jan. 1. Manifestly, if gold shipments 

 continued, and if the reserve in the Treasury 

 was not augmented, there would very soon be a 

 reduction in the net gold below the sum of 

 $100,000,000 which the unwritten law of the 

 department had held to be a reserve exclusively 

 for the redemption of United States notes. 

 Upon the advent of the new Administration 

 efforts were made to increase the gold reserve 

 by exchanging legal tenders for the coin in the 

 banks, but these efforts resulted in only a slight 

 gain, for on April 1 the net gold was $106,092,- 

 224. Gold shipments were than actively resumed, 

 and by April 18 the reserve was reduced to $1,040,- 

 000. Then followed the first stage of the panic 

 caused by the expectation that redemption of 

 Treasury notes of 1890 in gold would be im- 

 mediately suspended, thus bringing about that 

 which had long been predicted, the sudden 

 change of the currency from a gold to a silver 

 basis. But the prompt declaration of the Presi- 

 dent of a determination to exercise every power 

 to preserve the parity between gold and silver 

 restored confidence, and although the net gold 

 in the Treasury was subsequently reduced much 

 below the $100,000,000 limit, fallingto $81,551,385 

 on Oct. 19, the redemption of all Treasury notes 

 in gold served to dispel fears of a renewal of the 

 crisis, at least from this cause. The gradual re- 

 duction of the gold reserve of the department 

 caused withdrawals by interior banks of their 

 deposits in the New York institutions, and 

 brought about a general hoarding of gold all 

 over the country in anticipation of the approach 

 of the period when, unless relief were afforded, 

 Treasury payments in gold would have to be 

 suspended. 'The rapid depletion of New York 

 bank reserves, these being drawn down to 

 $5,481,975, June 24, from $25,439,925, May 27, 

 and the absence of the least indication of any- 

 thing more than temporary relief, laid the 

 foundation for the acute stage of the panic, 

 which was reached June 27, when the cable an- 

 nounced that the Indian Government had sus- 

 pended the public coinage of silver. The tension 

 relaxed, however, on the 30th, on news of the 

 calling by the President of a special session of 

 Congress for Aug. 7, to take action upon the 

 silver-purchase law, and the panicky feeling par- 

 tially subsided. But during the greater part of 

 July the entire country felt the effect of the 

 absence of confidence ; the distress among banks, 

 merchants, manufacturers, and all classes of the 

 people was very severe ; failures were frequent, 

 large in number, and important ; values of all 

 share property shrank regardless of intrinsic 

 merit, and the situation was deplorable. One en- 

 couraging fact, however, was developed, and that 

 was that the trials and suffering of the masses of 

 the people served to intensify the feeling that the 

 silver-purchase law was the root of the existing 

 trouble ; and as this conviction grew, there arose 

 a demand, which soon became almost universal, 

 for the prompt repeal of this measure. This 

 popular demonstration had its effect upon the 

 direct representatives of the people in Congress, 



and, soon after that body assembled in special 

 M-ion, Aug. 7, measures were formulated for the 

 immediate and effective consideration of a repeal 

 bill. The opposition were given every oppor- 

 tunity for the expression of their views not only 

 upon free coinage at the various ratios from 1 to 

 10 to 1 to 20, but upon the question of the re- 

 enactment of the act of 1878. Voting began 

 upon the ratio amendments Aug. 28. That 

 of 1 to 16 was defeated by 103 majority ; 1 to 17 

 by 140; 1 to 18 by 135; 1 to 19 by 134; and 

 1 to 20 by 101. The niajority for unconditional 

 repeal was 129. This result was hailed with 

 general satisfaction, and recovery from the de- 

 pression was rapid, materially aided by large 

 imports of gold and by easier money, until it 

 was checked by the delay of the Senate in acting 

 upon its repeal bill ; but there was no recurrence 

 of panic, and on the final passage of the Senate 

 bill confidence in the stability of the currency 

 was restored, and the question whether the obli- 

 gations of the United States will be paid in coin 

 current in all the markets of the world was 

 settled probably for all time. Business recupera- 

 tion was somewhat retarded by the agitation of 

 measures for tariff -reform ; and, moreover, the 

 delay of the Senate on the repeal measure had 

 prevented merchants from taking advantage of 

 the trade of the season, and it was not until late 

 in November that there was much revival in 

 business. Soon after Congress reassembled, in 

 December, the majority of the Subcommittee of 

 Ways and Means presented a detailed statement 

 of the changes in the tariff which had been de- 

 cided upon, and this report had a depressing ef- 

 fect upon many manufacturing enterprises, the 

 opinion prevailing that there would be great de- 

 lay in passing the tariff bill by reason of conflict- 

 ing views of members. Woolen and iron manufac- 

 turing establishments closed down, thereby great- 

 ly increasing the number of the unemployed, 

 and adding to the distress of the poor. Cus- 

 toms receipts fell to unprecedentedly low figures 

 for December, contributing to a reduction in the 

 Treasury cash to $88,989,887, including $81,- 

 475.335 net gold, by the end of the year. Sec- 

 retary Carlisle recommended, in his annual re- 

 port, an amendment to the resumption act of 

 1875, authorizing the department to issue $200,- 

 000,000 3-per-cent. five-year bonds with the ob- 

 ject of relieving the Treasury, and for other 

 purposes. Realizing and speculative sales of 

 stocks, encouraged by the financial embarrass- 

 ments of the Atchison, Topeka and Santa Fe, 

 which was placed in receiver's hands on the 

 23d, turned the market downward, and the 

 feeling at the close of the year was gloomy. 



Events abroad were more or less exciting at 

 intervals during the year. The political tension 

 in France resulting from the investigation into 

 the Panama Canal scandal, which was severe at 

 the end of 1892, was relaxed at the beginning of 

 this year, and there was nothing of a disturbing 

 character in that country until March 30, 

 when the Ribot Cabinet resigned in consequence 

 of a disagreement between the Chamber and the 

 Government regarding the liquor amendment to 

 the budget. A new Cabinet was promptly formed, 

 to be again changed in April, and again early in 

 December. In May there was a feeling of finan- 

 cial distrust, whicn was reflected by a fall in 



