January 24, 1885





The   Record   and  Guide.





81





The World  of Business.

The Business Situation.

It is vastly iimro important to a busiuess man to know what is going to
happen than w-hat has liappcneil, aud^whUe it is to be hoped that the lessons
of the cUsastrous year 1884 will uot be forgotteu, it is now in order to in¬
quire if we have not a prospect of better things during the year on which
we have just entered. It by no means foUows because the failures in 1884
were more muuerous than iu auy other year of our history, because many
classes of goods are selling below the cost of production, and because a large
number of laborers are out of employment that the present year is to be oue
of depres.siou. The sitiiation is a very unnatural one and will certainly find
its corrective before loug. The stagiiiition in business has been due to a sur¬
plusage of articles of comuiou use, wliich has resulted iu prices so low as to
deprive producers of a motive for effort. The result is idle laborers, idle
capital, and diminished purchasing power. Stocks of mauufacturod goods
have iu consequence run down, and in some cases agricultiiral products
have been as lavishly used as if the supply were unlimited. The consump¬
tion and export of our wheat, for instance, have been enoi-mous, and it is
only within a short time that the people have begun to susjiect that there
may be a bottom to the bin after all. The scramble for wheat iu this city
Satm-day afteruoou is a sort of thing that is Ukely to hap|ien iu the mar¬
kets for other commodities before the year is out. When traders realize
that, after an advance of 10 cents a bushel, wheat is still 10 cents below the
average of the last quarter of a century, and when they see that other arti¬
cles have been ahnost as badly depressecl, they will begin to think that the
buying side is the one to be on. It is not an advantage to any class of peo¬
ple except bear speculators for any article to sell below a price that will give
to the producer a fair profit, ami it is therefore a matter for congratulation
that w-heat has advanced, even though the rise has been somewhat t<io rapid.
The cheapness of food has made it possible for the laborer to live at a small
cost, but it has also limited the market in which he sells his work.
The milUons of dollars that will go to the West through the ad¬
vance iu wheat, if that advance shaU prove permanent, it wiU be
a strong stimulus to ti-ade. The signs of recovery elsewhere are not numer¬
ous, but it is aUeged that the iron trade has been made to appear worse
tlian it is, either to shal;c out some weak oporatoi-s or to inijiress the help
with the necessity for reductions in their wages. In the textile industries there
have been uo very unfavoralilo dovolopmeuts recently, and hero and there
a mill is starting up. It is tha opinion of the best judges that the curtail¬
ment of production has been greater than the falling off in consumption.
Anyhow the stocks iu the hands of wholesalers are smaU, aud whatever sup¬
ply there may be is mainly at the mills. Any resimiiitiou ot operations by
a mUl may therefore be taken as an evidence that new goods are wanted,
for after a factory is once stopped thei* is uo motive for resumption except
iu response to actual demand. Industrial aud trade reports from the South
ai-e encouraging, and that part of the country can perhaps boast more evi¬
dence of a revival thau any other. The condition of the coal trade is decid¬
edly uncertain ou accoimt ot the difficulty the companies have in coining to
an agreeiiieut as to the output this year. Of other commodities it may at
least be said that thei-e are no new symptoms of an unfavorable nature, and
that bottom prices seem to have been touched in most cases. England and
the Continent seem not to have gone so far in the process of liquidation as
we have, and great distiaist prevails there. Any iniiirovement on this sicle
will, however, meet a response in the Old Worlcl. The feature of the money
market is the immense amounts of funds paid out for iuterest aud dividends,
and there is great curiosity as to how much of this wiU be reinvested in
securities. 'Thore is every indication ot quite free purchases. The vast
accumulation of funds in the banks of New York and other cities has been
a sort of nightmare to many people, but it is pretty safe to say that we have
seeu the top of that pile for the present. There vvill be no difficulty iu dis¬
posing of those funds it a little revival of busmess starts up. And m addi¬
tion to home requirenieuts we are likely to be called on by Europe for some
of our gold in the spring. Money is high iu London, and if Australia is m
earnest iu its movements for the resumption of gold payniieuts we shall
have to contribute to its supply of the metal. The largest profits in seUing
stocks ou account of the business depressiou have eviclently bc^eu reaped.
The prices of some of them may go low-er, but rather because of the intrinsic
weakness of the stock thau from any general business trouble. The btjars
wiU, of course, not have on their side this year such an array of failures,
defalcations and shi'inkages in the prices of goods as they had in 1884. Just at
present the weak sjxits are the uncertainty as to railroad rates all over the
country, the clemoralizatiou of the coal trade, and the rivalry of the tele-
gi-aph companies.—Chicago Tribune.

Tlie Teleplionc Extortion.

The Bell Telephone Company is getting rich so fast that it is aSiamed of
its own hoggishuoss, aud it has asked the State of Massachusetts to legalize
its act in w-atering its stock up to double the already inflated capital, mak¬
ing "20 mUlious. It now pays 15 per cent, on its nominal capital. If the
stock is doublecl it w-UI still keep up its rates so as to pay big on the whole.
The charges of this company are absurdly excessive, aud this is ouly a step
away from the possibility of any relief. It is to be hoped that some inven¬
tor wUl soon produce an improvement in telephones; that he wUl be able
aud w-iUing to refuse to sell it to the BeU Company; that it w-Ul be put in
operation by men who w-iU be wilUug and able to compete to bring down
the extortionate chai-ges for telephone service.—Merchant's Review.

Tlie Business Revival.

Havuig listened about as long as its nerves would permit to the croakers who
have gone about ciyiug that everything in the business woi-ld was going to
smash, and believing that whatever trouble there might be was caused by
lack of confidence. The Globe some weeks since cletermined to make a very
thorough examination and leant the exact truth in connection with the
matter for the benefit of its readers and the piibUc generally, but more par¬
ticularly for the business portion thereof. That e.xamiuatiou li.as now lieen
completed aud the result is dcidcdly s^itisfactory, as a periLsal ot oiu-speeial
business echtion of this day will denionstrate. First of all, the lowest point
in the busmess depre.ssioii, which began unmecUately after the assassination
of President Garfield, has now been reached. Firm after firm and com¬
pany after comiiauy of doubtful financial stabUity has succmubed, iintU
now about all, probably, ot the weak timber has been removed. Wild-cat
concerns have beeu mercUessly rooted out and sent to the wall. Few, indeed
must be the weak institutions uow- left in existence. But thousands of sound,
w-holesome institutions remain, aud solid ground having fully beeu reached,
aU are ready for a good, legitimate, prolitalile advance. The very failures
of the year just clo.sed go to prove that we have been getting down to bed¬
rock, and that point once reached, the favorable reaction must, according
to precedent, very soou set in. There were 11,000 failures in 1884, with lia-
bUities of .s240.000,000. In 1878, the closing year of tho last depressiou, there
was 10,.500 failures, with .J2:i4,000,000 of liabilities. With all the weak
concerns w-eeded out by the tenable sta'aiu of 1878, times improved in 1S79,
and thore were in that year only 6,0.53 faUures, withhabiliti'sof .^48,'.iO(i,000.
And The Globe does uot hesitate to state its behet founded ou careful ex¬
aminations and comparisons, that the year on.whicu we enter to-day, 1885,
is to be, Uke 1870, one of marked prosperity. " Many features of the pa.st
year point to the coming improvement. Here in Boston the number of new
buildiugs erected has been almost unprecedented. They number 1,4:J8, and
add no less than -S7,50 ),000 to the valuation of the city. The amount of
money paid out in clivicleuds iu Boston has Ukewise beeu very large, far ex-
ces'iiug tha average since 1S7.S. Our eight broad-gauge railroads had an
ncome in 1884 of $2d,7(7,453, against, $3a,a67,970 in 18»3,  a falling off of





only ?190,517. The net income, however, shows a gain of ,$318,07.3, the fig¬
ures being .S7,:j40,:i87 in l.SMiri, agaiust .87,.55s,400 in 1S,n4. Put' pe'jiips the
most striking feature of the yeiu- just closed is tho showing made by the sav¬
ings banks. While the croakers \i&xe beeu endeavoring to make everything
dismal, the people have deiiosited 610,100,000 more than iu 1S8.S, aud 19 99s
new accounts have beeu openc^d. If a recent straw were needed, a very
significant one might bo found in the decided improvement in breadstuffs
this present week. The signs are propitious. Tho new year wiU be oue of
gi-atifyiug prosi>erity.—Boston Globe.

Tlie Denver ('onvcution on Silver Money.

There will be a State and national convention of the friends of silver
money held at Denver. Col, ou January 28. A letter from D. B. Harris
chairman of the exeeuti ve committee promoting this movement, gives some
adcUtioual information, aud urges the matter upou the attention of Texans
with the observation that the stock-raising States find a mai-ket for a laro-e
share of their sui-plus cattle iu the sUver-producmg regions, and the same
sort of remark may be made as to the western grain-raising States and their
cereal products. The committee has, therefore, made bcild to address the
governors of several Western and .Southwest a-n States, itskiu<i them to caU
conventiins for tho purpo.so of sending delc'^ates to Denver, so that the
convention may be highly representative and influential. The object of the
convention is to influence President Cleveland and Congress to estabUsh the
coinage of silver on a basis as free as that of gold, thus, as the promoters
beUeve, relieving the country of monetary difficulties which result from the
present irrational embargo upon the muiting of tho precious metal as it
comes from the mines. It is hoped that several of the governors vvill see
their way to render a pubUc service by calUug such conventions. The
object is a legitimate oue and Congress cannot too early and distinctly know
the mind of the people. The national bauk circulation is bound to corae
to au end unless the government perjietuates tho national debt, which
is not desirable, or unless Congress takes some new and singular method of
securing the bank circulation. There is not enough gold, as conditions and
relations of busiuess are now defined, to serve as money. There is a good
deal of silver aud tho use of silver certificates is a practical means of
obviatiug the inconvenience resulting from the weight of the metal. The
News wUl simply remark that the practical objection to sUver coinage
comes from the creditor class, and to avoid a formidable antagonism.
Congress acted inconsistently with Democratic principles in tho manner in
which it remouetized silver. It should have estalilishe 1 unlimited coinage,
and if the law-makers s!nv that a decided change hail come over the value of
sjvcr, so that they could uot expect the ''daddy cloU.ar'' to circulate ecjuaUy
w-ith gold, the remouetizatiou should have beeu accompau ed with such an
adjustment as would have given debtors and creditors as nearly as possible
a fair start. The objection to the gold standard is uot that it is uot nice in
theory, but that it is oppressive in practice ou account of the scarcity of
that metal, whUe prohibition of natural and substantially secured currency
expedieuts is the greatest of aU such oppressions, even surpassing the mis¬
chief of sQver demonetization.—Galveston News.

Are We to Have Still Lower Prices.

The m,arked shrinkage in values iu 18S4, following, as it did, a decline of
much longer duration, brings out in strong relief for 1888 the question of
whether prices will still continue downward. Tho question is ona of grave
concern, and being so, opuiiou is widely aud uncomiiromisingly divided.
Those w-ho suffered most the past year look upou a lower level for prices,
especially for products in which they ai-e interested, as unpossible of attaiu-
iiient, while others who have fared better or are natural born pessimists
think the end is uot yet. Between these two oiiinions there is no halting
gi-omid; prices have either touched "rock bottom" or they have not.
(Jousideriiig the impoi-taiice of the question it is to be regretted that intel-
Ugent study and research can bring us U.tle nearer to a safe conclusion
tlian cau the most superficial knowledge. Like iu many other things the
more thought we give to the subject the greater is our confusion; we
look anxiously for the light, but it does not appear. Investigation, instead
of clearing the future, befogs it with uncertainty. We realize that con-
lUtions have changed iu almost every brauch of industry, and that no
conclusion applicable to the busiuess of 1885 can, with safety, be based
upon examples or precedent. The country under conditions dis.simUar to
those which uow obtain has seen hi^h prices ami low pri es; and upon
this solitary fact must we haug our hopes and fears. At best, compari¬
sons show as that present prices are nominally very low, aud many people
may uisist that they are actually very low, also: but, unfortunately for
these comparisons, their force is greatly weakened by the one question,
" How much has production beeu cheapened in the time considered ?"
But if by comparisou of prices we cannot arrive at conclusions wholly
satisfactory to oui-selves, w-e can at least ch'aw valuable inferences there¬
from. It is from study, based ou conipai-isons, that observing busiuess
men form their opiuious as to the probabiUties of tho future. Con¬
sidered in this way comparisons possess a cei-tain, definite value,
aud if not always inviting as to results, are certainly interest¬
ing in a general way. And a number of very complete compari¬
sons have been made by exchanges since the new year openecl, shovring
tie movement of prices in detail in recent yeai-s. Those made in last week's
BracistreeVs we shaU refer to at some length. The time treated of by
Bradstreet's is from July 1, 1878 to 18vl, inclusive, with quai-terly
and highest and lowest prices for the past year. Several things are
made plain by these ccauparisons. Fu-stly, that all leading food
products, with the exception of meats aucl dairy products, have
touched a lower level during 1884 than during the depressiou existing
in 1878 and 1879—wheat 33 per cent, flour 25 per cent., sugar 25
per cent., cctt'ee 38 per cent., Japan teas 10 per cent and rice 4 per cent.
Butter and Indian com, ou the other hand, have beeu sustained iu price,
the lowest iirice of the latter iu 1884 being still 10 por ceut. above the lowest
figures noted iu the previous period of depression. Tobacco shows a .steady
and contuiuous advance. Fi-esh beef and mutton m 1884 ranged 3 to 2)4
cents per pound above the low prices in 1878. SeconcUy, that among the
textile staples the lowest prices of cotton and w-ool iu 1884 have each been 11
Iier cent, below tho lower range prior to the period of iurtatiou two years
ago. Print cloths have been over 30 per ceut. lower in 1884 than iu 1878,
and flannels are quoted quite low. ThircUy, that all the metals have
ranged as low, aud some have been materiaUy lower durhig the past yeai-
when compared with the levels If 1878 aud 1879. Pig iron, as shown by
trade is (lowest for 1884) 8 per ceut. above the bottom price in 1878, but is
nearly as low as it w-as during the greater porticju of the two years specified.
Bar u-on (refined) is 5 per cent, higher than it was for a short time in January,
1879, but is quite as low, even lower, than w-as the rauge over the two years
referred to. Nails are, or have been, 12 per ceut. below; steel rails, 40 per
cent.; copper, 33 ix;r cent.; lead, 23 jier cent., and tin plates, 13 per cent,
below the most dejiressed cpiotatious for those articles six aud seven years
ago.—Aye of Steel.

Hold Fast to the Bland Act.

Not a few of the newspapers ot the State which are noiv advocating the
necessity of coutiuuiuiT the coinage of silver with commendable earnestness
and vigor, are deiuanding that Congress shall pass au act making coinage
free aud milimited. This undoubtedly is the very jxirfectiou of the aspira¬
tions of a sUver-produciug State, aud this journal would be among the first
to congratulate the miners of Colorado upon the return of the good times
when one could deposit his sUver at the mint aud have it coined into money
or receive its value. Under the present coinage act the miners ot Colorado
are depriv-ed auuually of mairv- thousands of dollars that would go into their
pockets instead of into the Treasury of the General Government if a free