FINANCIAL AND COMMERCIAL REVIEW.

3

MONEY has become exceedingly abundant under the influence of those causes which, in former numbers, we indicated as in operation to produce it. It is now with some difficulty that money can be placed on good securities at all, and many brokers, accustomed to take in money at call, have, during the month, turned away considerable sums at any price. This is the case, notwithstanding that much speculation exists in many articles of produce at advancing prices, naturally requiring more money; and also, though large imports for the three first weeks in January, and the pressure of goods upon the market creates a demand for cash to pay duties on the part of importers, prior to the realization of cash for the spring sales. Hence a demand for short loans springs up, and this demand the banks seek to resist, in order to seize every opportunity that offers to manufacture opinion against the Independent Treasury. The importers, however, understand the matter, and the amount of capital in private hands enables them to set the banks at defiance. The lapse of a few months now will so justify the operation of the present system of finances, as to make a reversion to Bank rule impossible.

As, however, the amount of outstanding obligations, both on the part of individuals and corporations, is quite small, the process of expanding these credits, as the spirit of enterprise developes itself, supplies means. It is not until

a considerable amount of paper matures that an enhanced demand for means is felt. The prospects of the foreign trade continue very fair; and the industrial sections of England, as well as of western Europe, give promise of a season of great prosperity, which has already produced an influence upon raw materials. Cotton particularly, which, although it has advanced much within a few weeks, is yet quite low.

The latest advices from abroad continue to evince indications of returning industry, restored confidence, and reviving trade. Raw materials were more in demand, intercourse more active, and stocks advancing, as the general effect of the peaceful election of Louis Napoleon. In Great Britain, affairs are also promising. The accumulation of specie in the Bank of England was great, having been progressively as follows:

SPECIE IN THE BANK OF ENGLAND, AND NOTES ON HAND.

The dividends on the national debt are payable quarterly at the bank, and the amount of notes on hand fluctuates with the payments. The accumulation of coin has been steady and large during the three months, notwithstanding a large importation of produce, including 3,000,000 qrs. of grain. A considerable portion of

this was sent from a disposition in Europe to realize; and it has been supposed that many districts have so far oversold themselves as that they will be obliged to re-purchase in the spring. Two remarkable facts are prominent, however, viz: that the price of grain has been well sustained under the large importation to realize; and that notwithstanding the payments required to be made in the face of small exports, the bullion has increased to a very considerable extent (fully 10 per cent.) in five weeks. The large import into England has only served, however, to keep down prices of food to such a level as has permitted the revival of the home market, and stimulated that revival of trade of which the manufacturing districts affords evidence. The continued cheapness of money resulting from this state of things, must sustain that improved condition of the manufacturing districts that has manifested itself in the last few weeks, causing an advance in cotton. This is indicated in the following table of prices in New-York :

PRICES OF COTTON IN NEW-YORK.

:

The prospect is that the United States produce will continue to improve in value and extent of sales, more particularly cotton. It is, however, to be borne in mind, that as an adverse element, cotton in the last few years has lost much of its influence upon the money market. Thus, until the last two or three years, the bills offering in the market for sale were in the proportion of 60 per cent. drawn against sales of cotton. That is to say, out of an aggregate export value of about $100,000.000, $60,000,000 was cotton, and that article furnished nearly all the bills drawn on England. These bills being sold to importers of goods, frequently, with city indorsements, were subject to discredit and non-payment upon every reverse in that article. This discredit involved a demand for money and an export of specie to cover a remittance that produced a pressure throughout the country. Now, in 1849, the proportion of bills in the market drawn against farm produce advanced from 17 to 50 per cent. of the whole amount offering, while those against cotton were only $42,000,000 out of $150,000,000. In this state of affairs, it will be observed, that the reverse in the cotton market was of minor influence, and during the fiscal year, 1848, when cotton had been low the bills drawn against food have reached $37,000,000. In the present year the export of food has increased, and consequently the accounts which reached us from Europe generally are of a character different from any that have been received for many months, inasmuch as that they indicate what might generally have been expected, namely, that while the future course of political events is becoming more clearly indicated, industry and commerce are accommodating themselves to the new state of things, and con- . sequently reviving. It is not in the nature of things that the complete paralysis which overtook all branches of industry last spring could continue for any great length of time. Such a supposition would involve a relapse into an age of barbarism; accordingly we find a demand for raw materials becoming more extensive,

and prices disposed to rise, giving great stability to the chief staple product of the United States. It is also apparent that the demand for breadstuffs and provisions must continue, to a considerable extent, to counteract that tendency in prices to advance which has been found detrimental to the progress of general business in England.

The advancing value of cotton is a matter of great congratulation to our southern friends, whose product last year sold unusually low, but are this year likely to realize higher rates, for an increased production. It is also the case that the European demand for United States' stocks is reviving rapidly, and for United States' 6 per cents coupon stocks, the foreign demand has been active.

The following table indicates the transfers for the ten weeks ending with November, when the books closed, and for the two weeks succeeding the opening on the 1st January, when the dividends were paid:

TRANSFERS OF UNITED STATES STOCK TO FOREIGN ACCOUNTS.

It would seem from these figures that the desire on the part of Europeans to invest in American sotcks, particularly in Germany and France, increases as the ability to realize property there progresses. Thus the French rentes, under the peaceful election and inauguration of Louis Napoleon, have risen to 45.50 a 48, and other property has become more saleable-circumstances which, although they might not induce the great mass of holders to change interests, would be seized upon by many shrewd capitalists to transfer to safer regions. In fact, the continued large demand for silver for Europe that sweeps the London market at advancing rates as fast as very considerable sums arrive from South America, indicates the constant disposition throughout Europe to exchange paper for silver, more particularly in Austria and Prussia. Trade improves, as it must, upon a specie basis, and the old disposition to hoard specie, which thirty years of peace had, in some degree softened, appears to have revived throughout Germany, and with good reason. This discredit appertains more particularly to government credits. The paper system has for long years formed the bond of union between the governments and the moneyed aristocracy, represented by great bankers in all countries. Thus, the nobles, gentry, and wealthy citizens having money to invest, put it into the hands of Rothschilds, who turn it over to the several governments for stock bearing interest; which interest is paid by the working many. The governments, under the plea of protection, have given their moneyed citizens monopolies of almost all trades, by which their wealth, and therefore their means of lending to the government, has been increased, at the expense of consumers. This system

is now falling to pieces. The age is progressive; and when Austria, as recently, comes forward for a loan of $40,000,000 for the purpose of defraying the expense of the re-conquest and subjugation of Italy and Hungary, and on the success of which the payment of the interest depends, her calculations are fallacious. The constituency of the Rothschilds, like those of all other bankers, decline loans on terms so manifestly opposed to the spirit of the age. The whole fabric of European paper credit is tottering. It is come to be recognised as the sole means of governmental strength, as opposed to the people; and the migration of capital to the United States may be expected to proceed in increasing amounts, more particularly that discredit is passing from the indebted states. The events of the past year in Europe have imparted more than usual interest to the message of the President of the United States; all parties in Europe being desirous to see in official documents the workings of republicans amid the disasters of the old systems. There never was a more opportune display of the great blessings of our institutions than was contained in that document. Even the English papers betrayed the admiration that they necessarily felt in contemplating such extraordinary evidence of a prosperity to which Europe has long been a stranger.

The late report on the finances of Pennsylvania, affords a similar instance of the great recuperative powers of an American state, when freed from the oppressive burdens of paper credits. When the noble Key Stone State became enthralled in the meshes of the U. S. Bank, she abandoned her taxes for the support of government, embarked in wild schemes of speculation, ruined her credit, and became insolvent amid the bankruptcy of the institution which had lured her to ruin. Manfully, however, she rallied to the work, and has now resumed her place amongst the most irreproachable of indebted states.

Her revenue and expenditure for four years have been as follows:

REVENUE AND EXPENDITURE OF PENNSYLVANIA.

Hence, after paying all expenses, including the payment of $800,000 domestic debt, the balance on hand at the close of the year, has increased about $200,000. In 1840, a tax was imposed on real and personal estate, to raise the means of paying the state interest. As this was a new and onerous tax, it came very hard in a season of general depression, but was persevered in until it has become eminently successful.

The gold fever continues to affect the several markets to a considerable extent. Although there may be less general excitement in relation to the matter, there is more methodical enterprise. Instead of persons without means hurrying off individually without any matured plan, the great American principle of association is being more extensively applied, and persons with means, and of high character, combine to insure success. There are a great variety of ways for the formation of companies. Thus there are parties who, as in case of the copper mines, form companies under some outstanding state charter, and then fit out a vessel with every possible convenience, such as a large frame house, india rubber tents, every variety of tool and machine necessary to thorough and scientific work, and well provisioned. They seek as great a variety of mechanics as possible, requiring no money, but that each shall give responsible security in $500. These are to work the mines on shares-that is, all the gold dug will be divided, one-half to the com

pany, and one-half to the miners, whose half will be charged $100 for each passage. Another plan is for parties of (say) forty persons of all trades, and a physician, to subscribe $500 each, buy a schooner something like a Baltimore clipper of perhaps 250 tons, with frame-house, machines, tools, goods, tents, and provisions, for the purpose of ascending the rivers as near the gold regions as possible, keeping the vessel for a magazine and depot. The company to work in relays and divide equally, all being drilled to the use of small arms for mutual defence in case of accumulating difficulties there. Companies of these descriptions, from this and other cities, will be the most effective form that the gold enterprises will take. In the mean time, goods, in very considerable quantities, are both ordered and being consigned there.

The favorable aspect of the foreign markets for produce, aided by the collateral influence of the demand for California, has produced higher pretensions on the part of holders of goods generally for the spring trade. Domestic cottons and wollens particularly are higher, and holders will not contract for future delivery at present rates, and many manufacturers will not deliver at all until May, and then ouly at future market rates. The pressure which the markets endured in the last year from the goods driven out of Europe by the political revulsions, has evidently passed; and the manufacturers, after earning reasonable dividends in the face of that pressure, are now about to reap the advantages of a healthy market, based upon the prosperity of the consumers of goods-a prosperity founded upon the extended foreign markets for the sale of surplus productions. They are already aware of the soundness of the business for the coming year, and are by no means disposed to have their business again disturbed by a nominal change in the tariff, which would induce the investment of large capitals in manufactures, and again expose them to a more ruinous and lasting competition than that which the revolutions in Europe created during the last year. For these reasons, the leading organs of the manufacturers are discouraging any change-much to the distaste of superficial demagogues, who cannot afford to lose the tariff excitement. The ad valorem principle of duties has, more than any other, been triumphantly vindicated by its own action, because it was more pointedly assailed. The late circular of the department most effectually removes the only material abuse to which it was exposed through the collusion of collectors with owners in the appointment of appraisers. It has been repeatedly alleged by theoretical protectionists that it is practically impossible to fix the market value of goods so as to cast the duties; while they assumed that specific duties could always be attained in the accurate ascertainments of quantities. Experience has shown this notion to be purely chimerical. The markets for goods in Europe are in usual years very steady, and not subject to material fluctuatiog from month to month. Hence, when invoices from all ports, and from a great variety of manufacturers and exporters, pass into the hands of an appraiser, he finds that the variation of price in certain styles of goods is scarcely perceptible. But if among (say) 20 invoices, he finds one description of goods valued at ten per cent. less than all the other invoices, perhaps from the same parties, fraud is apparent. In such cases, the owners of the goods, being dissatisfied with the judgment of the appraiser, have a right to demand another appraisement. In this case the appraiser makes out a list of five names of such persons as he knows to be well acquainted with the goods in question. This list is submitted to the collector. If, now, the collector sought rather political popularity among dishonest merchants than the faithful discharge of his duty, he could send for the owner of the goods, show him the list, and ask if the names suited him. The owner might then designate his own clerk or friends as appraisers, or, in short appraise them himself-an operation which completely neutralizes the whole object in having an appraiser at all. The late circular puts an end to all this. It requires collectors to retain at least two names submitted by the appraiser, and to conceal from the owner the names of all. Thus impartiality of judgment is arrived at, and the legal duties faithfully levied. It has already occurred, under this order, that the dutiable value of goods has been advanced 25 per cent. by the appraiser, and the owner has declined to call an appraisement. All regular merchants and business men rally strongly to the support of the vigilant and faithful officer who insures fair play to all parties, and who does not connive at the designs of a few.