THE STATE OF TRADE.

Globe, Volume XXI, Issue 1654, 9 June 1879, Page 3

THE STATE OF TRADE.

The most striking feature of English commercial nows is the extraordinary price to which tho funds have risen consequent upon a large supply of money for which there in no demand. The city editor of the “ Times ” writes on April 21st:—“Interest at the moment in the city is centred in the steady rise in Consols, which are now quoted within | per 1 cent, of par. The small wars which the Government have on hand exercise no effect upon tho minds of investors compared with that which was produced by fears of a rupture with Russia, The probability of Roumelia being quitted by the Russian troops, and tho social troubles o. Russia, seem, in fact, to have allayed all apprehensions regarding further serious differences with the Russian Government, and hence the strong current of floating capital which is now flowing into British Government stocks, under the influence likewise of exceptionally abundant money. The rise is probably duo also to operators fop the fall diminishing and cloei- g their engagements. Speculators, for the fall in this class of security, have been singularly wrong in their forecasts from the period of the commencement of the troubles in the East up to the present time. Apart from this influence, which is but transient, there is no doubt that wo must go back very many years before wo could discover a combination of circumstances such as are at present forcing up the price of the best securities. In whatever quarter we look it is dilH cult to find solid traces of such a revival of trade as might be expected within a reasonable period to absorb a considerable proportion of the idle money in Europe. Tho Banks quite rightly deem it wiser to do nothing rather than meddle with doubtful business, and tho result is that borrowers and lenders alike are competing for the only securities that are beyond suspicion, with tho result we are now witnessing. Bills have been discounted to-day at 1-J- to i, and loans arc obtainable on the easiest possible terms.” On the same day the “ Daily News ” writes : —“ It is now becoming a serious consideration with those who have capital or savings to invest what channel they shall seek for its profitable employment. In spite of the bad times with which the country has been afflicted for three or four years, an undeniably 1 irgo amount of money has to be invested, and when, as is now the case, the rate of allowance made by bankers and others for deposits is almost nominal, the natural disposition is to find, if possible, some safe and more profitable outlet. At the present time many millions are utterly unemployed in commerce owing partially to the current stagnation, and partially to the low quotations of most descriptions of produce and manufacture. In these circumstances it is not matter for surprise that a rush is made to buy high - class Government securities, such as Consols. Tho price of 93* to which Consols have now attained, is without precedent in recent years, and not only private individuals but Sinks find it more remunerative to shift their available balances into a security which will bring them somewhat more than 3 percent. Daily the question is asked by those possessing money to invest as to the direction their investment should take. While in ono sense it is satisfactory to find so much reliance placed in the national stock, on the other hand it is only too sure a sign of slackness and depression. Money cannot find a vent in the ordinary channels, and recourse is had therefore to the s-tfest substitu'e. With th« outlook so blank and unsatisfactory ns now, i< is not k apprising that predictions are fr.-ely hazarded regarding tho possible future quotation of Con-mis. It is passible that par m»y ho rear’ ed before dividend time.”