Collapse of the Silver Room

Evening Star, Issue 7641, 18 June 1888, Page 4

Collapse of the Silver Room

The si'iV er boom has come down with a complete collapse, and though the continuance of the land boom and a strong rush for all classes of investment have kept things from becoming altogether flat, still those who put their whole heart in silver have been very heavy losera, and a glance at the share quotations and at the capital value of the various mines discloses the . cerions character of the collapse, and afford an illustration of the hoUoftnebs of the recent boom. On the )Chh of last month the Broken Hilla (block No. 14) were L 7 17s 6d; now they are worth only L 3 14s. The company has 100,000 shares; so in less than a fortnight the stock has fallen say L 400.000. The Broken Hill Proprietory has 16,000 shares, which were worth L 261 last month, are now Worth L2i J 5, and this was the only mine paying dividends except the Gipsy did. The Broken Hill South wero worth L 8 each, they have fallen to L 3 4s. Broken Hill Junctions sold at L 4 sa, now they arc only worth L2 103—L125.000 of a fall. The Central Broken Hills wer6 worth LSI 10s, now are worth Ll—a fall of LOO,OOO. Coming to the Tuna mines, the Cordillera Hill drops just LIOO.OOO, in value from L2 8s to LI Bs. Then there was the North and South Cordilbras, which Buffered a heavy fall, representing L 137,000 ; and Peel Wood fell 30s per share. Anions; the smaller mines were similar crushing falls. The Rising Sun, Silver King, Victorian Cross, Commodore Vanderbilt, Mount Costing, Pinnacle, and Tribute all went the same way. The fall in value of silver stocks here mentioned was upwards of L 2,000,000 in a couple of weeks; and tor thoso who have bought largely for speculative purposes, to be delivered in two months, or perhaps a month, this was all right as long as the silver was going up. They would take the shares, sell, and go on buying; but when the market fell and the shares became due the sharebrokers could not pay, and the eonsequence was that the shares had to be forced into the market and sold for what they would bring, Some illustrations may be given of the conduct of these unscrupulous or reckless dealers. For example, one of the defaulting brokers bought through another person at the top of the market at LlO 17s 6d. The shares fell, and the defaulter would not take them up. The purchaser resold them at L 4 2s, and loses the difference. Tne defaulter had also bought shares and mortgaged them. He has been in difficulties several times, and at a meeting of his creditors, held recently, he stated that only last Cup rime all he had was LI ; still this man was_ buying thousands of pounds' worth of scrip. The bank at last Btopped his credit, and he left Melboui-ne and could not be found for about ten days. He turned up again on Friday week at the Melbourne Stock Exchange, stating that he had nothing and they could do what they liked with him. He was suspended by the Exchange the moment they heard the complaint against him, and has since been arrested for passing a valueless cheque in payment for some scrip. Another sharebroker who has just failed io involved to the extent of about L 14.000. He began business about twelve months ago with only Ll5O. A meeting of his creditors was held a few days ago, and he could not pay thorn. The only secured creditor is the Bank, which was carrying him on till it stopped his credit on the 23rd May. This broker dealt in large quantities, and took up several time transactions, in which various other people are involved. He also Was suspended by his Exchange. The third sharebroker under suspension, it may be mentioned, has absconded from Melbourne, leaving large liabilities in silver shares, and nothing is known of his movements. In another case the broker has come to grief not through his own fault, but through the misfortune of having dealt with a lame duck. He called his creditors together, and on learning the circumstances they willingly accepted 8a in the £. The next case was that of a broker who was the first to have his credit stopped by the bank a month ago, when payment for a lot fell due, and the stoppage struck the first note in this crash. He was liable for about L 3.000 ; since then, however, this broker has been able to make good his liabilities, and he has paid in full. It is right to explain that these brokers do not belong to the principal Exchange, which is a very exclusive body. It has over 100 members, and the price of a seat is L 1,300.