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September 39, 1883
The Record and Guide.
THE RECORD AND GUIDE.
191 Broadway, N. Y.
ONE YEAR, in advance, SIX DOLLARS.
Communications should be addressed to
€. W. SWEET, 191 Broadway.
J. T, LINDSET, Busineag Manager.
SEPTEMBER 29, 1883.
The Lesson of the Failures.
The great liquidation continues. Prices steadily decline through¬
out the commercial world, As Mr, Groschen, the English states¬
man, proved in his remarkable address delivered in London last
April, since 1873 the price of nearly all commodities dealt in on
all the markets of the world has declined from twenty-five to
thirty-three per cent. He also pointed out that this great shrink¬
age will continue to the advantage of persons with fixed incomes
and the creditor class, while it will press with terrible severity
on debtors and the entire business community. The advance in
prices, produced by resumption, which added all the gold and
silver to the paper previously afloat, relieved this country for
several years from the effects of this general depression in values,
but the reaction began with the death of Garfield and the crop
failure of 1881. Then came the dry rot iu railway securities, which
has continued down to this day. General business also has been
suffering by the gradual cheapening of every product dealt in on
all the exchanges and markets. When the lowering of prices
produces its natural effect in bankruptcies, the newspapers all
unite in declaring that each particular disaster is due tc special
causes. One firm is ruined because it speculated, another because
it endorsed too freely, another, it is claimed, has over-produced.
These are the various causes assigned for the Shaw leather, the
Mayer, Levy, and other failures, but the true reason at the
back of them all is tha difference between the cost of production
and what the article could be sold for iu the market ; in other
words, because of the shrinkage in the values which commenced
in 1873 and has continued down i;o the present time. Everyone in
trade knows that prices were never at so low au ebb as they are
to-day except in periods when a panic prevailed.
Mr. Goschen, Mr. Gibbs, ex-Presideat of the Bauk of England,
the Rothschilds in Paris, and other farseeing bankers attribute this
shrinkage to the practical substitution by the commercial world of
the gold unit of value for the double standard which prevailed
previous to 1873. The yardstick by which measures are valu&l
haa been shortened, for since the substitution of the gold unit the
supply of the yellow metal has fallen off. Neither California,
Australia nor any of the old goldfields furnishes the abundant sup¬
ply which so stimulated prices from 1848 onward. Gold has had
to carry the burdens of all the commerce of the world at a time
when its volume was relati-vely decreasing. It has been proved
beyond all peradventure that from 1876 to 1881 the production of
gold has been only $669,528,689, while there have been used in
coinage and the arts in the same period $979,907,785, or $310,379,-
096 more than was produced. Hence the steadily increasing value
of the yellow metal. It was in 1873, it will be remembered, that
lhe United Statea and Germany discarded silver; since then Hol¬
land and Italy have adopted the gold unit -of value. It has
required positive legislation in all the commercial nations to bring
about this disastrous shrinkage in prices, which is causing the
bankruptcies about which we are now hearing so much, and which
will continue to keep on ruining those engaged in active business.
It is a curious circumstance that the press of New York, which
has vigorously denounced bi-metallism and has opposed every
effort to bring silver into use to relieve the pressure on pricea, are
themselves Uhe victims of the financial policy they have so
strenuously advocated. The World, Tribune, Times and Herald
have been conspicuous in their denunciation of all legislation
which looked towards relieving the business distress by using
silver as well as gold. It must be confessed that their advocacy of
mono-metaUism was not very intelligent, but it was undoubtedly
sincere. I'hey were so zealous and even bigoted that they would
not give the bi-metallic side of the controversy a chance to be
heard. In justice to the Tribune, however, it should be
acknowledged that it allowed the late Thurlow Weed to publish a
number of letters in its columns correcting the views of its editor¬
ials on this question. It will be a matter of astonishment to the
proprietors of these papers to be told that the recent reduction in
the price of their journalsjis primarily due to the acceptance by
the commercial worldjof^the fgold mono-metalliem they advocate. '
But the price of their papers has been forced down by the same
general causes which havo been at work in the stock market,
cotton, grain, wool and all departments of business.
The Real Estate Situation.
October is the real commencement of the fall season for business.
A survey of the real estate situation is, therefore, uow in order.
The situation may be summarized as follows :
1. In the judgment of the leading dealers in Pine street the
liquidations now going on in general business will not materially
affect real estate prices this fail. Holders are firm and there is
no pressure upon the market. The experience of all past specula¬
tive eras shows that as real estate is the last to go up it is aJso the
last to go down in value.
2. Aa there has been no " boom," so called, in city property,
the reaction when it comes cannot be very great, Down-town
improved realty may show a falling off in values on forced sales,
because of the depression in general business. Office buildings
have become too numerous for the present needs of the lower part
of tbe city, and may take some years to utilize them all.
3. There is a ready aale for housea costing from $15,000 to $30,000,
provided they are well located and desirable, but the class who
wanted $40,000 to $80,000 houses are just now crippled and are not
in the market. There are not, however, enough of very high priced
4. The building of apartment houses haa also been overdone tem¬
porarily. As our table shows there are many unrented suites of
rooma in the first-class flats. The same remark is true of third and
fourth-class tenement housea.
5. Tbere are very few unrented houses suitable for private dwell¬
ings in thia city. There haa been no atatement in rents ; indeed,
in some favored up-town localities there has been slight advances.
The demand is unusually large for houses renting for one and two
thousand dollars per annum.
To sum up the real estate market, it may be quoted strong but
dull. No one expects au advance in values nor will there be any
serious decline. New people arc constantly coming to the city
and all houaes and desirable apartments are in steady demand.
New Down-Town Buildings.
A greediness that defeats itself has always beeu tbe besetting sin
of the New York speculative builder. It seems lately to have taken
possession of the owners of down-town property with peculiar
As the new building of the Mutual Insurance Company advances
it is seen what a mistake it is to set a building of the dimeuaions
and proportiona of this on an alley, and Naasau street ia little more
than an alley. If the owner opposite chooses to put up another ten-
atory building, he will, of course, make the fifth story of the
Mutual building nearly aa dark as the ground floor of the ordinary
Nassau street building, and the stories beneath will get still leas
light. If Nassau street had been widened three or four years ago,
when the necessity for the widening had become evident, and the
immment elevator buildings had not yet been actually erected, the
widening could bave beeu effected at a comparatively moderate
cost. The Mutual Company might have protected itself by setting
back its building with a plaza in front of it, so as to secure an
ample light on at leaat one side, and would probably have
found this sacrifice pay in the increased attractiveness of its build¬
ing to tenants, even if the city had not assumed and assessed upon
the adjoining property some portion of the cost of the improve¬
We made remarks to this effect before the Mutual building was
begun, and the justice of them must now be evident to everybody.
Instead of withdrawing their building, the Mutual people have
apparently encroached with their portico several feet upon the
sidewalk. The result practically is that a building as high as the
Mutual opposite would deprive the lower half of it of light.
Architecturally the building will be thrown away, since it cannot
be seen from anywhere. From a point of view directly opposite
the cornice will be at an angle of 75 degrees, more or less, from the
spectator, who is not likely to run the risk of dislocating his neck
to admire it, but will pass it with the reflection that so big and
ornate a building in so narrow and dark a street is a monument of
All this is not to be imputed to the architect, of course, whohad
to make the best of a very thankless problem. He could do noth¬
ing in general composition that would be effective with a building
any front of which could not be fairly seen all at once from any
point of view, for the side streets are quite as narrow as the street
along the front. Really it seems that the only thing to be done
was to make the openings as big as possible, to have the detail of
the lower stories, which can be fairly well seen, as attractive as
might be, and to let the architecture go at that.
Aa a matter of fact, so far as it has gone, the building is unusu¬
ally massive; that ia to aay, the proportion of opening to wall is