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York, in June, 1847; which office he accepted, and is now assiduously engaged in the performance of its duties.
In conclusion, we think Judge Strong possesses all the requisites for the honorable station he now fills. He has a logical mind, well imbued with legal principles; a thorough knowledge of the rules in judicial proceedings, acquired by an extensive practice of over thirty years, a quick perception, which enables him to apprehend readily the main features of a cause, with an accurate discrimination of its merits, and great promptitude of decision-qualifications indispensable amid the ever accumulating business of the Circuit, and at the general and special terms of the Court. We therefore hesitate not to predict for him an enviable reputation as a judge. Like his father and grandfather, he is a practical farmer, and warmly devoted to the interests of those who pursue that useful occupation. Like Long Islanders generally, he is ardently attached to his home, and it has been with much reluctance that he has yielded to the wishes of his friends, and accepted a station which leads so much into public life.
FINANCIAL AND COMMERCIAL REVIEW. TнE progress of the commercial revulsion in England is producing a change in the features of affairs in the United States, as well as in those of the large cities of Europe. England has for the last two hundred years assumed the highest rank as a commercial nation. Since her superior natural advantages enabled her to triumph over the Dutch, whose indomitable industry created, as it were, a country from out of the bogs of the Netherlands, reared great cities on the marshes of the Scheldt, and raised luxurious meadows from the sunken Delta of the Rhine, and whose free trade policy made the world tributary to her commerce, out of which sprang a navy, that long disputed with England the mastery of “the channel”—England has been the centre of the commercial world. In all that time, amidst the most disastrous seasons, and the most devastating wars, her national faith has remained unshaken, and the credit of her merchants undoubted. The trade of the world has been concentrated in her ports, and her harbors have been filled with produce from all countries, and of the remotest regions, consigned unreservedly to British merchants, whose acceptances would command purchases, as well in Mexico as in Manchester, in Valparaiso as in Vienna, as well in Bengal as in Berlin. The trader in Brazil knew their value, and the silk merchant of Persia hesitated not to take them for his wares. They were “current money with the merchant” at all the great Fairs of Europe, and commanded the products of American industry without stint or limit. This universal credit gave command of capital, and the industrial products of the world were at the disposal of the “ Merchant Princes” of London. Within a few months, this almost limitless credit has been blasted as with the simoon. In all quarters of the world, owners of produce hold back the shipments, and scrutinize names never before doubted. When money is paid for cargoes, none are delivered in a British port without pre-payment of freight. Bills on British merchants are turned from with distrust in Hamburgh, Frankfort and Smyrna, as in New York, Charleston and New Orleans. England's debtor's in Europe, as well as in the United States, will no longer trust the obligations of British merchants as a means of payment. The New York merchant, who, for ten years has been accustomed to hear American faith derided as an ignis fatuus, is too jealous of his credit to hazard the payment of a draft on London. He turns from bills on high sounding names, proffered by an hundred hands, buys a bag of gold at much greater expense, insures and ships it to redeem his promise, being too VOL. XXI.-NO. CXIV.
chary of his mercantile character to trust for its support to the uncertain tenure of British credit. The consequence of this universal distrust of the ordinary means of settling balances between nations, is a general movement of specie towards England by those who have purchased her goods, leaving in the hands of those who have sold produce to her, bills that are without demand, and therefor at very low rates. Out of these circumstances it must result that those bills offering at low prices without takers, will eventually be satisfied only by drawing the specie from England, and the extent to which the import will be restrained, will be the degree in which the fears of remittance in relation to the payment of the bills may be realized.
The movement of specie during the past year has been very great and eccentric. For many years previously it had accumulated from various causes in the leading reservoirs, and probably reached its maximum in Sept. 1846, when the aggregate amount at five leading points was officially reported at $223,867,420. Against this amount of specie, paper money was issued in sums severaliy as follows:
SPECIE ON HAND AND PAPER ISSUED AT FIVE POINTS.
48,000,000 Bank of England....
100,157,616 Banks of New York.... Nov, 1...... 7,341,398.
6,119,518 Banks of New Orleans.. 1.......$ 6,627,027.
3,037,071 Russian “ bills of credit,” 1.... roub. 114,000,000..........96,000,000. 196,000,000
At these five principle points, the amount of paper money emitted was very little in excess of the specie which formed its basis. The operation of trade in a time of great confidence and abundance of capital, caused paper to be active and specie to leave the channels of circulation for places of general deposit. Since that time, viz., within the year which closed with Nov. 1, the reduction of specie at all these points has been material, while the circulation of paper has not been greatly changed; according to the latest returns, the position of atlairs at the following places was as follows: France. England. New-York. New Orleans, Russia.
Total. Specie.. $17,922,349....39,510,560....7,745,821....6,048,068....67,200.000....138,426,798 Bills.... 43,827,226....93,725,529....6,140,230....3,535,050....91,000,000....237,568,035
These figures give a great change in the movement of the metals. It would appear that from the three European points, a sum equal to $84,000,000 gold and silver had left the chief reservoirs and gone into circulation, while the outstanding paper was not diminished, showing that the active currency of the commercial world has been increased by that amount in addition to some $10,000,000. mostly silver, sent to Europe from Mexico and the Rio Plate in the same period. This is a singular phenomenon in commercial operations, inasmuch as that it is precisely at this moment, when the actual currency has received such addition, that money is most scarce in Europe. It apparently arises from the fact that specie is capital, and paper, its representative, is not capital, it is only a local currency. Hence, when the active capital of Western Europe was impaired last year by the failure of the crops and enhanced consumption, through the influence of railway expenditure, there came a demand for specie to exchange for capital in the desired shape of produce. Deducting the silver which went to Europe from Mexico and South America, some $20,000,000 of the above amount came to America, and the balance went to Eastern Europe, in exchange for com. The Russian port of Odessa alone exported some 14,000,000 bushels of grain. The operation was apparently to make the capital of Russia available as it did that of the United States. Money flowed into Russia from Europe, and through the ordinary channels of business accumulated in the Treasury, until, as reported officially, the departments of "bills of credit" beld £20,000,000 against those issues. While the farm produce of Russia was thus profitable, her mines were so, in even a greater degree. The official report gives the quantity of gold
worked in crown mines, and in those of Siberia and Orel, and received at the mint of St. Petersburg at 1,283 poods in 1843 ; 1,341, in 1844; 1,386, in 1845 ; 1,722, in 1846. Taking the Russian pood at 36lbs., and the price of gold at $19 per oz., the product of 1846 was near $20,000,000, and for the four years, over $60,000,000. This affluence of gold has placed the Russian government in a strong position, more particularly that its agricultural capital has become so prolific. Hence, in March last, two decrees were signed, appropriating 45,000000 roubles, or $33,000,000 to the purchase of securities. This was done to the extent of $10,000,000 in French rentes, and the balance mostly in English consols. The specie so transferred to the banks of France and England has scarcely aided in checking the decline in the amount held by those institutions, which, as we have seen, stands very low as compared with last year. With this low state of bullion, the prospect for the coming year depends upon how much will be the demand for capital for the coming year. The struggle in England is simply this. To supply the urgent existing demand for capital, money must still continue to leave England to procure it, and France is the same position, to a somewhat lesser extent.
If money leaves England to any further extent, it will be fatal to all those who have outstanding engagements maturing, and who must have money to meet them. This is truly a want of money, but it is a want of money based on deficient floating capital. Now, in both France and England, there is a large capital, which is of the nature of fixed capital, because it is necessary to the health of the internal trade. We allude to the precious metals in general circulation in the hands of the public. In France, the amount so situated, was estimated by a member of the Chamber of Deputies, by profession a banker, and a leading one of Paris,* at 1,605,000,000 francs, or $306,937,500, a very large sum, but necessary to the transaction of internal business with stability.
It was proposed in order to release a considerable quantity of this specie and make it available as capital, in the purchase of foreign food and produce, to allow the Bank of France, which had hitherto not issued notes for circulation under 500 francs or $100 each, to issue them as low as 200 francs or $40 each. It did not avail itself of this privilege, until Nov., when the Finance Minister of France announced a loan of $70,000,000, to be adjudicated on the 10th of November, and to be paid in monthly instalments of 12,500,000 francs. The Bank probably issued some 25,000,000 francs of these new small notes in aid of that operation, and will continue probably to put them out, as they get into permanent circulation, by displacing the circulating coin. In England a similar project is urged. It is estimated that the quantity of gold permanently circulated in that country is £30,000,000 in sovereigns, and is necessary to trade, inasmuch that the bank issues no notes under £5. It is contended now, that if the bank should issue £1 notes, that they would displace the sovereigns in circulation, which would flow into the bank and become available as capital in the foreign trade, and for the relief of merchants in meeting their engagements. No doubt something similar to this would result. The demand for foreign produce would increase, and gold flow more freely forth in payment. The ultimate success of the plan for curing the present difficulties, would depend upon the question whether gold enough could be displaced from circulation to supply all the demands for capital. The precedent of 1825 is freely referred to as evidence in favor of the plan, when the Bank of England having in fact failed, although it had not announced it to the public, was saved through the discovery of a box of £l notes. These it issued, and as they displaced sovereigns in circulation, the latter flowed back into the vaults of the bank and saved the institution, and also the country, according to eminent opinion. That small notes then worked well, was probably owing to the fact that the demand for capital, for purposes other than its reproduction in the more valuable shape of exportable goods, was not great, that the chief cause of the adverse state of foreign exchanges had been the large investments of British capital in foreign government stocks. That cause had ceased to affect the market, when the small notes were issued--the relief they gave the bank by procuring for it a temporary supply of gold was sufficient. Such a state of things does not now exist. The demand for floating capital to sink in railways is as great as ever, and the companies as industrious and eager
in hunting up means, If the bank, by the use of small notes, should bring forth from circulation 30,000,000 sovereigns, will they satisfy the wants of the railways, which are expressed in money, $5,000,000 per week, until May 1847—say 75 weeks, making $370,000,000 ? If it will not meet that demand in addition to that of all the industrious employments of the country, but only stimulate the energies of the lines, and the bank is then overtaken with a want of specie, exposed to the clamors of the holders of 30,000,000 £1 notes, the inevitable result will only have been swollen in magnitude by the effort to stave it off. In other words, the bank will only have multiplied its creditors by millions to feed the movements of a few embarrassed debtors.
The leading banks of France and England may, by their action in respect of small notes, release $250,000,000 of specie from circulation, of which $100,000,000 in silver would be from France and $150,000,000 in gold from Great Britain. A large proportion of those would find their way to the United States under the present system of currency, because the United States alone supplies in odequate quantities that capital in the shape of cotton, rice, tobacco and farm produce, to procure which the specie is sought to be released from the small channels of European circulation. The general discredit which has overtaken dealers in Great Britain, has had a serious effect upon the autumn trade. It has reduced the transactions to cash, no person being disposed to part with goods for promises, hence the continual diminution of the consumption of raw material while its price falls. The weekly return of the mills in Manchester, for four weeks, showed results as follows :
This shows a fearful progress of decay in the manufacture of an article which forms one half the value of British exports. Yet cotton is abundant and daily becoming less in price. The manufacture of railways, which cannot be exported, continues unabated, and iron in good demand and very high. This influence of the railways upon the price of iron, has greatly affected the manufacturers of iron, and incapacitates them to compete as successfully with foreign countries. Hence the export of England's hardware is circumscribed. In this state of affairs the government revenue for the quarter ending October 10, declined 1,285,857, as follows:--
BRITISH REVENUE-QUARTER ENDING OCT. 10TH.
Customs. Excise. Stamps. Property tax. Other items. Total. 5,310,835••••4,181,9-26....1,774,361....1,972,128....649,850....13,889,103 4,956,614. 3,539,946....1,707,945....1,918,645.... 489,041....12,612,191
354,221 641,980 66,419 53,483 160,809 1,276,912 The decrease in the customs arises to some extent from the removal of the duties on grain, on which, in 1846, some considerable sums were received. The consumption of British articles subject to excise has shown the greatest falling off. The stoppage of the work on the railroads to any considerable extent, by throwing hands out of employ, would make a still greater deficit in this branch of the public revenne ; more particularly that the famine again threatens so severely in Ireland. There being now no duties on breadstuffs, the prevailing distress diminishes the revenue of the government, which derives no advantage from imports of food.
Amidst all the diminished work in manufacturing districts, decline in the consumption of dutiable goods, and falling off in the revenue, aided by reports of good crops, breadstuffs continue to advance; the highest price was reached for wheat on the 29th of May, since when the averages for the whole kingdom has been weekly, as follows:--
PRICES OF GRAIN IN ENGLAND WEEKLY THREE YEARS.
8. d. 8. d.
102 5..56 5..36 3 June 5. 46 3..39 5..22 5.
99 10..55 3.35 11
88 10..52 0..34 1 48 2..30 3..22 8.. .52 0..27 1..23 8..
7..52 1,.33 " 26...... 47 10..29 9..22 7.... 51 5..27 3..23 4...
4..52 4..32 11 July 3...... 47 11..29 7..22 2......
2..27 4..23 6... 87 1..51 11..32 10 " 10........47 11..29 10..22 8.. ....52 10..27 6..23 8........ 82 3..43 8..31 11
48 10..29 0..22 6........52 3..27 7..24 3........74 0..46 11..29 7 " 24........50 0..29 6..22 4........50 10..27 10..33 0........ 75 6..45 8..30 5 “ 31....
77 3..45 3..31 11 Aug. 7...... 55 3..29 7..22 8... ..45 2..26 9..24
5..43 11..31 8 " 14........57 0..29 4..22 2... 44 1..27 3..23 3........ 66 10..40 9..29 1 " 21........57 0..29 9..22 8........45 11..27 5..23 3.
6..38 11..28 9 28........56 6..30 0..22 4. ..47 10..29 1..23
60 4..37 9..27 Sept. 4.... .55 10..31 8..22 10.....
4..30 1..23 1.
8..36 3..25 5 ..54 1..31 0..22 3... 50 1..33 4..23
4..33 1..24 7 " 18.... ..52 6..30 9..21 7. .51 3..36 1..23 7.
6..32 1..22 5 “ 25........53 2..30
0 Oct. 2........56 0..31 1..23 4........54 0..36 9..24
3. ..56 9..32 0..23 0 9........
9..31 3..23 4.... ..56 10..37 2..24 7........54 2..32 4..22 11 “ 16.....
58 2..32 0..23 5.... .59 10..38 8..25 8........54 3..32 6..227 “ 23........59 5..33 0..24 11........60 10..40 2..26 6........55 2..33 7..23 4
It is curious that prices, amidst the most disastrous, panic that has ever overtaken England, should be nearly as high as last year, when money was very abundant, and great fears, subsequently realised, in regard to the crop, were entertained, and that they should have risen 5s. for a quarter, in the course of a panic which hasprostrated 250 firms and banks, and in all branches of business, and occupying all grades of commercial rank, from the governor of the Bank of England to the bagman. From this fact it is evident that the demand for grain is kept in check, like that for cotton, only by the scarcity of money, and that it will be revived with greater force than ever the moment the market is in any degree relaxed. Meantime, however, the export of the precious metals has been somewhat large to supply the remittances being made by those who distrust all bills on English houses. For the month of October, $674,548, mostly Mexicans and five francs, left New-York for France, and $90,000 from Boston. The steamer of the 1st carried $298,000 from Boston, of which $250,000 went from New York, and the packet-ships of the 1st, carried $118,575 silver, mostly to France. Subsequent packets carried larger sums, making near two millions, from Nov. 1 to 16th, while the prices of bills at New-Orleans and New-York were far below the specie point, or a rate at which the precious metals could be shipped profitably, showing this shipment of specie to be an artificial movement, under circumstances that warrant its return in accumulated volume. It produced the effort of restraining bank loans, raising the value of money, and depressing the prices of United States 6 per cent. Treasury notes to 99 with the interest. During the quarter ending November 1, to which period the banks made up their returns to the NewYork Comptroller, the movement of specie had been as follows:--August. September. October.
Total. Duties paid 10 Custom House....3,337,511. ..2,096,604. .1,237,475.. .6,729,049 Import of specie
380,873 Export of specie
674,548. . 1,091,473
This gives together a sum of 7,439,629 drawn from the banks during the quarter, in addition to the instalments of the $18,000,000 called in, and naturally the amount held by the banks should have shown a considerable decrease. The returns for November 1st of the city banks show, however, $7,992,000 on hand against $10,769,732 in August last, and $7,314,103 in November last year. The diminution from August is $2,700,000 or $4,600,000 less than the amount drawn from the banks during the quarter, showing that through the transfers effected, the amount drawn from the institutions into the Treasury was restored to them, and