THE FINANCIAL CRISIS.

Temuka Leader, Issue 2167, 24 February 1891, Page 3

THE FINANCIAL CRISIS.

“Broadbrim,” who writes letters from New York to some of ©or contemporaries, describes the financial ’ panic as follows:—“ All the week the city has been trembling in the throes of a financial earth, m which some of the oldest and most substantial houses in the city have gone down. The storm which has been impending for! several months burst on the city last \ Monday, and all through the week it has raged with unparalleled fury. Many of our most solid banks, which were credited with large resources, were shaken from turret to foundation-1 stone, and in the general storm the North River Bank went down. As old an institution as the Bank of North America was attacked by the pirates on Thursday, and notwithstanding that it was a creditor of tbe clearing house with a comfortable balaree of 737,000d01s in its favor, for five mortal hours in the business rush it trembled like a reed shaken by the wind. After tbe terrible scenes of Monday and Tuesday the knowing ones said the storm was over, even Jay G-ould said to a reporter that he thought the worst was passed ; bat on Wednesday tbe clouds again began to lower. Thursday the wind was blowing fifty miles an hour, and on Friday the storm burst forth in all its fury. Friday brought the news of trouble with the great firm of Baring Brothers. Forty millions of tbe Argentines had dragged them down, and tbe shock could not have been greater if t>hp Rothschilds had failed or the bottom dropped out of the Bank of England. The wild excitement that followed the announcement cannot be described. The floor of tbe Exchange resembled the incurable cells of a madhouse. Men screamed and shouted, and threw fortunes into s|je njaelstrom as the ground melted away beneath fhpif feet. Eypn tfoe good news of Saturday that a syndicate backed by the Bank of England bad guaranteed tbe Barings’ forty millions of dollars, failed to restore confidence, and the sun went down on Saturday night on the most disastrous week of

the century. It discounted the memory of Black Friday by hundreds of millions of dollars, For the like of the present generation it will stand as a week accursed in the financial calendar.” We hare every right to feel thankful that we have not yet experienced such financial disasters as are herein described, but our day will certainly come, and that within the next ten years. We prophecied the Bank of 'New Zealand trouble, and our forewarnings have proved true. We had a most miraculous escape m the matter of the Bank of New Zealand. Only for English capitalists coming to its aid it would have been bankrupt, and large numbers would have been ruined. It is evident, too, that there were terrible times in London during the crisis above described, as evidenced by the fact that the Bank of England had to borrow gold from the Bank of France. These facts show the reed on which we lean in trusting the ordinary banks, and ought to make us think and look about us for some safer repositories for the people’s money. Such a crisis as is depicted in this article would be impossible if a State Bank existed, but we presume it is no use discussing that for the present. A day will come when it will be discussed, but meantime we think we have done our duty in directing attention to it.