FINANCIAL REVIEW OF 1898. 



261 



above noted, but after May rates grew easier and 

 the range for the remainder of the year for indorse- 

 ments was from 2 per cent, to 4-J- per cent., the 

 former in December and the latter in September. 

 First-class four to six months' single-name paper 

 ranged from 3i per cent, to 7 per cent, until May, 

 and from 3J per cent, to 5 per cent, thereafter, being 

 easy at 3i to 3f per cent, in December. The gen- 

 eral revival of business and growth of confidence 

 which followed the victories in July and the end- 

 ing of the war enabled collections by merchants to 

 lie promptly made, and therefore there was com- 

 paratively little need for borrowing, and hence the 

 olli'rings of commercial paper were small. ' At the 

 same time the demand for paper was quite general, 

 not only from New York and Eastern banks and 

 other institutions, but from banks in the chief 

 Western cities, who thus sought to employ their in- 

 creasing balances. Investments were also made by 

 these Western institutions in railroad and other 

 mortgages, and in sterling exchange, and in the 

 last two months of the year reports were quite gen- 

 eral of abnormally large balances held by banks in 

 comparatively remote sections of the country, and 

 of reductions in rates of interest on deposits, in- 

 dicating an unexampled plethora of unemployed 

 money. One notable feature was the large clearings 

 of the associated banks of New York. On Nov. 15 

 the clearings amounted to $240,800,402, and on 

 Dec. 13 to $233,468,989. The clearings for the 

 week ending Dec. 17 were $1,119,883,255. and in the 

 following week the total was $1,022,436,939. The 

 daily average during the week ending Dec. 17 was 

 $186,647,209, and the largest previous daily average 

 was $159,232,190 in 1881. 



The following is the New York Clearing House 

 statement of totals at the beginning of each quar- 

 ter of 1898 and at the end of the vcar 



tendency was downward until near the end of the 

 month, when European buying of our securities 

 aided in a recovery. The rally was feverish, how- 

 ever, the indications pointing to a speedy rupture 

 of friendly relations between the United States and 

 Spain. The market was almost continuously weak 

 during March, influenced by the Cuban situation. 

 The dispatch of two transport vessels by the Gov- 

 ernment with supplies for the starving reconcentra- 

 dos at first caused some friction at Havana, and 

 the reported demand by Spain that Gen. Lee, the 

 United States consul general, be recalled, created 

 a feeling of uneasiness which was reflected in the 

 stock market. The action of Congress in unani- 

 mously placing $50,000,000 at the disposal of the 

 President for strengthening the national defenses, 

 and the immediate preparations for war on the part 

 of the Government, had a greatly disturbing effect 

 upon the stock speculation. The market was un- 

 settled and lower until the 28th, when, concurrently 

 with the transmission to Congress by the President 

 of the report of the Court of Inquiry on the " Maine " 

 disaster, there came rumors that the Spanish Gov- 

 ernment had consented that the United States 

 should be allowed to feed the starving reconcen- 

 trados, and had also made other material conces- 

 sions. These rumors caused a sharp upward reac- 

 tion in the market, but immediately after news that 

 Spanish war ships had left Cartagena, and that an 

 unsatisfactory reply had been received by this Gov- 

 ernment to its demands upon Spain, distinctly fore- 

 shadowed the outbreak of Avar, and stocks were un- 

 settled and weak at the close of the month. The 

 market was less excited early in April, notwith- 

 standing the rupture of diplomatic relations with 

 Spain, mainly for the reason that our foreign trade 

 position was exceptionally strong, giving us control 



Stocks. The stock market was favorably in- 

 fluenced in January by the improvement in trade 

 conditions, by ease in money, and by increased rail- 

 road earnings, and there was an exceptionally good 

 demand for railroad bonds, sales of which were 

 almost unprecedented in magnitude, reaching a 

 total for the month of $92,870,210. The Vander- 

 bilt stocks were the favorites with speculators and 

 investors, and Lake Shore and New York Central 

 were directly affected by the proposed merger of 

 the two roads. The completion of payments to the 

 Government for the Union Pacific road caused the 

 stock of this company to advance sharply, and the 

 large increase in earnings and the acquisition of 

 the Seattle, Lake Shore arid Eastern Railroad by 

 the Northern Pacific stimulated buying of the stock 

 of the last-named road. Among other influences 

 operating on the market were the success of the 

 Illinois Central bond negotiation, the offer of re- 

 funding bonds bv the Rock Island, the purchase by 

 the Erie of the New York, Susquehanna and Wes- 

 tern, and the declaration of a dividend by the Mobile 

 and Ohio. The discussion of the Cuban question 

 in the House of Representatives, and the dispatch 

 of the " Maine " to Havana served to depress 

 the market only temporarily, and the tone was 

 generally strong at the close of the month. After 

 opening active and higher in February there was an 

 unsettling fall caused by the De Lome incident, fol- 

 lowed by a general decline on news of the disaster 

 to the " Maine " in the harbor of Havana, and the 





assurance that our finances would not be disturbed 

 by war. Moreover, preparations for a conflict were 

 being actively made, and the feeling prevailed that, 

 owing to the disparity in strength of the combat- 

 ants, the war would be of brief duration. The 

 President's message, urging intervention in Cuba 

 and asking for authority to use the army and navy 

 for this purpose, was followed by the adoption of 

 resolutions by Congress practically in accordance 

 with the President's suggestion, and diplomatic re- 

 lations with Spain ended on the 21st. These events 

 had comparatively little influence upon stocks, and 

 the market was almost stagnant at intervals until 

 news came of captures of Spanish vessels by the 

 blockading fleet off Cuba and the bombardment of 

 Matanzas, whereupon there was a partial recovery, 

 and the speculation was more active for the remain- 

 der of the month. News of the decisive victory 

 won by Commodore Dewey on May 1. involving the 

 destruction of the Spanish fleet at Manila, caused a 

 sharp advance in the stock market on the following 

 day, and on the receipt on May 7 of official details 

 of the engagement there was a further rise in prices. 

 Speculators and investors manifested great confi- 

 dence in the situation ; purchases were large, not 

 only for domestic but for European account, and 

 the tendency was upward thereafter, especially in 

 the Granger stocks, which were affected by the en- 

 couraging outlook for the crops. Until the Spanish 

 fleet commanded by Admiral Cervera was definitely 

 located in Santiago harbor there was some apprehen- 



