Columbia University Libraries Digital Collections: The Real Estate Record

Real estate record and builders' guide: v. 22, no. 557: November 16, 1878

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Real Estate Record AND BUILDERS' GUIDE. Vol. XXII. NEW YOEK, SATÜEDAY, NOYEMBEE 16,1878. No. 557. Published WeeJrly by TER5IS. ONE YEAK, in advance.. ..SlO.OO. Communications should be addressed to C. W. SAVEET, Nos. ."MS AND 3-17 BnOADWAV CONFIDENCE AND CREDULITY. The times are sick and saiUy out of Joint, and nostrums innumerable are being prescribed for their amelioration. Political partie-s, okl and new, aro nglow with vigorous lifo, born of the convic¬ tion that each one pcssesscs the sole panacea for national troubles. In each case, however, the prescription involves the entrusting of eovern- luental power to tbe particular political party which proposes the remedy. Of all the Solutions olYered, that is the most empty, inadequate and commonplace, %vhich as- serts that our present commercial and monetary disordei-s are due entirely to a lack of confidence; and that when confidence again revives, the cur¬ rent of aP'airs will run smoothl}-. If we analyze the views of parties who offer this explanation, we will generally find that they would be more correctly represented if tbe term credulity was substituted for that of confidence. It is restoration of credulity not of confidence" that they regard and rely upon as tbe harbin- ger of better times. The strained and delusive prosperity, for example, thafc preceded 1873, was due to an extravagant oxcess of conüdence—iu a word, to that false confideuce which is properly denominated credulity. Conüdence is founded in reason nnd knowledge, and buikls from a firm foundation a solid, endur¬ ing and substantial structure. Credulity is founded iu bosh and mooushine, and delights it¬ self with fautastic droams of a tinselled and va- pory prosperity. Confideuce begau to bo awak¬ ened when reason was restored with the first peal of the cr.ash of 1S73, aud has beeu steadily and slowly developing and maturiug itself duriug suc- leeding years. In times of artificial prosperity and altitudin- ous values, all commercial trausactions become gaines of chance. Confideuce is not exhibited then bi' the buj'er or seller, but by the ono who st^iuds aloof and remains quiescent, There is a common repugnance in human nature to being consciously swindlod or imposed upou, and au equally strong instinct to faucy one's seif cap¬ able of imposing upon oth ere. In the estimation of some, the highest tide of business prosperity is when the multitude consent to be easily deluded and duped, and when the shrewd aud wary few are ablo to take advautage of unfortunate inno- cence. Rational confidence is possible only in a stable and orderly State of affairs, when valuos are low, when credits are assured, and when there is no incentive nor probability of Tiolent läucfcuations, when credulity has no food to nourish itself upon. But with bubbling and expanded values, witb overtaxed and overburdened credit, with extreme and sudden lluctuations, confidence is impossible, credulitj' indispensable, and suspicion and tim- idity become the marks of wisdom. It is fora return of credulity, notof conildence, thnt those are seeking who labor to bring about a fresh inflation of our present overexpanded cur¬ rencj', in anticipation that such action will start tho wheels of trade into fresh activity. They lose sight of the fact that wo are still struggling with the incubus of a redundant currency. Although the gold premium marks within a fraction of par, this condition has been brought about not by con¬ traction, but by tho threat aud expectation of prospective contraction—as potent adepressaut a.s actual contraction; by the favoring conditiou of trade balauces; by fche determiued attitude of the goverument in arbitrarily and forcibly fchwart- iug any tendeucy to a rise iu premium, and by the weariiiess of the people wifch au inconvertible curroucy. Inflation has spent its force, and no longer iuflates. Added issues of irredeemable currency could not fail to introduce confusiou woi-se confounded iuto our present disorders. It is for a return of credulity, nofc of confidence, that those are seeking who advocate the doctrine that a dollar of irredeemable currency is as good for the working man as a dollar of gold. A cur¬ rency created by the necessities of the war, backed by the faith and determination of a patri¬ otic people. reinforced by government authority in judical deerees and legislative enactments may have an easy power of circulation; but a paper dollar issued without necessity, without sanction or guarantee, and in the face and defiance of all sound doctrines of government and finance would be fouud to have little or uo circulating power. Supposing its circulation possible, the disturb¬ ance iu values, which would be likely to follow, would leave the wovkingmau iu a most pitiable and deplorable plight. His wages would uudergo little if any substantial increase, while the cosfc of living, including i-ent aud the uecessaries of life, would rise out of all proportiou to auy pos¬ sible advauce iu his wages. The stoppage of in¬ dustrj-, fche intimidatiou of capital, aud the geu¬ eral confusiou would militato against the inter¬ ests of the workingmau and leavo bim without emijloj-ment and without hojio of obtaining it. It is for a returu of credulity and not of confi¬ dence that those are seeking, who would make us believe that ourpreseut troubles are iuno measure due to a pi'otective tariff aud to excessive and burdeusome internal taxation. Those statesmeu who are going aboufc ticklhig the ears of the rab- ble with assurances of such unfounded aud illogi- cal stittements had better speud their time aniong the manufaeturers who, under the ipgis of govei-n- mental protection, have seen their industries multiplied so many fold over the face of the couutry as to rentier competition impossible because self-destructive. Thej' kuow litfcle of the proportion that exists between the individual taxes and income of average Citizens, who un¬ dertake to say that taxes are easily borne or constitute bufc a trifling bürden afc the present time. A government, whether federal, state, or municipal, which tolerates that praetical commun¬ ism of appropriating the subsfcance of one class and applj'ing it to the benefit of another, under the guise of governmental taxation, may be fairlj' construed to be on the high road to disso- lution or revolution. It is for a return of credulitj- and not of con¬ fidence that those are seeking who advocate the doctrine that debt, whether governmental or in¬ dividual, is a blessing to be cheerfully borne and lightlj' considered. The enormous loads of public debt, which were piled up during the years of in¬ flation, are hanging like mill stones upon the neck of industrj-, and threaten to retard almost indefi¬ nitely the returu of healthj'- activitj- and of pros¬ perous times. In the morass of personal debt, manj- an enterprising and useful man has been hopelesslj- submerged. Abhorrence of debt, limitatiou of the power of contracting govern- mental debt, are a>riong the lessons which the collapse of inflation is still burning deeply into the general conscience. It is for a return of credulitj- and nofc of confi¬ dence fchafc fchose are seeking who teach and pre¬ tend fco believe thafc the time will shortly conia when values of real estate will be restored co the highest point that thej' ever reached, that the maximum or par value of vacant land is far above the plane of present valuations. Credulity, not confidence, inspired the man who paid an average price of fifty thousand dollars apiece for Central Park lots and gave mortgages for nearlj' four-fifths of the amount. Credulity, not confi¬ dence, always underlies a rapid expansion of real estate values as it is the mainspring of every great and determined speculative movement. Confidence is a delicate plant thafc requires ten¬ der and faithful nursing. Confidence may be necessary for the restoration of a healthy tone to business affairs, but it is confidence of that solid, inquisitive and skep.icul sort that calls for the substance, and not tlieshadow, for demonstration not for idle vaporing, for sound reasoning, and not for einptj'dogiuatismand hold assertion. The causes, wbicb led to our recent wide depar¬ ture from the path of sound commercial practice and doctrine, bad their origin iuthe patriotic pur¬ poses of the peoiile, aided and supplemented by govermental action, bufc never entirely controlled bj- it. The halt given to continued inflatiou in 1874, was at the command of the unoflicial ma.sses of fche people. The reactiouary measures and events that have transpired since, are simplj' re- sponsiveto general and uuinistakenble monitioius. The restoration of prosperitj-, or of normal healthy activitj' in affairs, will also take its origin aniong the masses. When the road is unobstructed and clear, no longer choked with '.the detritus of infla¬ tion, those who are free aud unhampered, di.sen- tangled from embarrassing burdens. will be ready to Start out upon a fresh jouruej" of commercial eutei-prise and industrial tffort. aiEASÜRES OF DEPRECIATION. There is more or less confusiou prevailing in the public mind with reference to real estate values, and it is bj- no means easj- to regulate the disorder and to set up absolute and reliable Stand¬ ards. It is true that real estate has declined heavily, but it is uot true that it has declined in