THE PANIC IN THE CITY.

Daily Southern Cross, Volume XXII, Issue 2807, 25 July 1866, Page 6

THE PANIC IN THE CITY.

We continue our English, extracts :—: — Friday, the 11th May, 1866, was a day of confusion and alarm in the city," such as has no parallel in the memory of the •' oldest inhabitant, " who is generally supposed to be well acquainted with local history. Certainly the panic which took place in the autumn of 1557, when the Western Bank of Scotland and four other great provincial banks stopped paymerit, with a great number of private firms, never reached that height of anxiety and suspense which appeared everywhere to exist on this occasion. It was not till after business hours on the 10th that the suspension of Overend, Gurney, and Co. was mads known ; and the effects became painfully visible early on the following morning. .No one need wonder that throughout London, and even far away into the country, the tidings of the failure of a great house, accredited in the popular imagination with almost boundless wealth, should diffuse ,a feeling of uncertainly and dismay, or that those who had the least to lose were precisely those who were most terrified and impatient. By 10 o'clock, when the more leisurely class of business men proceed to town, they found at every station that the joui'nals were gone, and that there was an unsatisfied demand, for thousands more. In the city most of the banks were open fey 9 o'clock, as if inviting the public to test their resources ; but if any feeling of this nature animated the bankers in the morning, they must have been perfectly satisfied by mid-day that the public did intend to test them, and that severely. There was not at first mufih of a crowd,' except in the immediate precincts of Overend, Gurney, and Co., where people assembled to satisfy themselves that the house was actually shut. And a mournful sight it was: There was no longer that cheerful look of business and" wealth for which the establishment was formerly famous, but the shut doors told a sad enough tale to all who passing. The name on the brass plate seemed to read like an epitaph. The glory of the old house had departed. There, where a great business had gradually been built up by years of carefulness, and shrewdness, and patience — there where the Guraeys had first made the name beloved on account of their generous zeal and warm sympathy for the oppressed — all now was silence and gloom. From the ,pld House came no sign, while the news was spreading through the country, and there was "flashing over the telegraph wires to every business centre of Europe the ominous word "suspended." The conduct of the banks was admirable. Hot only did many of them open an hour earlier than usual, but some did not close till an hour later. If fear ever reasoned, this display of solvancy would have restrained the run, but the panic allowed no man to reason. Hour after hour, the palpitating crowd increased, and rumours of the most alarming kind were circulated. About the Stock Exchange it early began to be whispered that the Bank directors were sitting, aud ciic lAsuuiusiou or cneir deliberations was eagerly looked for. It was not that the rise of one per cent, on the rate of discount would of itself have had any great significance on such a day, but the outside world wanted to know whether the Bank had already begun to feel the panic. In the Stock Exchange itself," perhaps, there never was so much absolute consternation. It was in vain men attempted to keep cool, and to deprecate the spreading of reports which might turn out to be false— the feeling of the hour was too much for even the least excitable, and announcements were accepted as conclusive which, on other occasions, would not have been listened to. Some one had made up hia mind that the Bank Act must be suspended, and, it having been suggested that a deputation .should wait upon the Chancellor of the Exchequer as early as possible for the purpose of urging this course upon him, this and that were put together, and placed "upon the Stock Exchange as accomplished facts. All this was doubtless a foreshadowing of ■what afterwards did take place, but at the time the statement was issued it was mere imagination. The Chancellor's answer was also graciously given to the effect that the Bank might issue five millions of notes above their maximum without holding gold to cover the amount. It is a curious illustration of how much all'this panic is a question of confidence, that no sooner was this announcement made than the market felt better. People began to breathe * little more freely, holders of stock became saucy, and would not sell at the ruinous prices which had prevailed, and, in short, there was a gleam of sunshine in that most gloomy place. The outside crowd, however, would not bear a very close investigation. At first, the look of the city was appalling ; but as the day advanced, it became evident that a portion at least of the surging crowd was composed of a , pretty much the same materials as the concourse at a Lord Mayor's Show. The multitude was vast in Lombard-street ; but of whatever elements it was formed, it became grayer and graver as the day advanced. In place of the groups gazing up at Overend, Gurney, and Company's the whole street had become one moving mass of black coats and hats. There was no shouting and chaffing, as in ah ordinary mob of roughs. Of course the alarm had been intensified when at an early hour in the forenoon it was whispered that the English Joint Stock Bank had shut its doors. That establishment had only recently taken over the business of Messrs. Olding and Co. Samuel Rogers, poet and banker, who lived in Stoke JSewington Green, when that was an aristocratic commercial suburb, was for a considerable period the principal partner in the old firm; and Mr. Samuel Sharp, well known for his works upon Oriental literature, and a member of many learned societies, was also an active partner in the house. The suspension had all the effect of that of a first-class house, for men were excited. The name passed from lip to lip. It was the failure of another bank — that was enough, and it was worked in the seething brains of those vpho were predisposed to get alarmed, until they also , made a dash at the steps of the house where their wealth was deposited, and added to the pressure which was now .becoming really severe, even upon old and rich establishments. One of the most interesting physiognomical studies of the day was to watch the contrast of expression on the countenances of the ladies. They entered the banks, looking deadly pale ; they came out again with a faint smile upon their faces, and with their hands tightly gripping carpet-bags — so called because not made of carpet, but of leather. About midday, when the second editions of the morning papers were expected to make their appearance, the newsvendors' shops in front of the Royal Exchange were besieged. The public euriositywas then gratified by the appearance of the correspondence which had passed between the governor and deputy-governor of the Bank of England and Earl Russell and the Chancellor of the Exchequer, resulting in the suspension of the Bank Charter Act, and with some other-intelligence as to the state of public feeling in the city during the morning. Later in the day the eveningjpapers, with additional intelligence, were in demand. All things concurred to show that the public anxiety and suspense had been greatly allayed,' but the numerous failures we report show that some time must elapse before the. effects of the gigantic disaster will disappear.