LATE MONEY CRISIS.

Poverty Bay Herald, Volume XXXIV, Issue 11146, 9 December 1907, Page 2

LATE MONEY CRISIS.

PANIC IN AMERICA.

CROWDS BESIEGE BANKS

EXCITING SCENES

Under date of Ist November, the London correspondent of the Argus wrote: — The failure of the brothers Heinze to corner tlie United Copper shares has precipitated a banking crisis of quite unexpected severity m New York. The drastic action of the Clearinghouse Committee m forcing the resignations of four presidents of tlie National Banks, because they had been concerned m the copper deal, created a feeling of hysteria m the public mind, which was further excited by President Roosevelt's avowal of his determination to continue his efforts fo puilish successful dishonesty, even if the immediate effect of that policy were to be partly productive of a slump m the stock market. The trouble began with the Mercantile National Bank, which is closely connected with Heinze's. Matters grew more serious when the affairs of the Knickerbocker Trust Company, a much more important concern, became involved. The Knickerbocker Trust held many millions sterling on deposit. On 22nd October a persistent run .commenced upon all its branches. After paying nearly two millions: over its counters m the course of three hours, the trust exhausted itjs immediate reserves m cash, and was compelled to' suspend paynient. ' WILD. SCENES. Wild, exciting,, and tumultuous scenes attended the dosing of the 'Knickerbocker Trust's doors. The trust early prepared to meet tlie emergency by rushing thousands of cfollars through the streets to -its branches m motor 'cars/ milk waggons, and gas company trucks. One truck collided with a hearse, arid was overturned, spilling many bundles of notes. Directly the doors opened crowds of excited depositors, of- both sexes, tried to rush the establishment, fashionable ladies struggling with thie poorer classes, Many men.: withdraw thousands of pounds, leaving the bank with huge piles of nlotes tucked under their waistcoats. One lady -recovered £8000 and a man drew out £5400. Numbers promptly deposited their money. in another bank across the . street. Others placed jt m public safes, or took it home. Some .were robbed by thieves before they could cross the street. One W^' Street financiar grimly ■pemarked, "It's a bully time for thieves* and safe-breaker^.- ' When the suspension occurred,. , women sobbed hysterically, a nd ' men howled m unison, . "Give ua back om ■ dough,'' Mr Turntiull, , the vioe-presideiit of the Knickerbocker Trust, bitterly assailed President Roosevelt, declaring that . ■" his speeches caused all the trouble by creat*'ing public distrust .m financial- fnstitii-. tions. Next morning threatening and angry crowds awaited the opening of the doors, and. when it was announced that they remained closed, there were howls. of execration. At the main office, opposite the Waldorf-Astoria hotel, ladies of fa : .shion stood m a queue beside black butlers and footmen m livery, all eager to save their deposits. Many ladies remained cheerful under their disappointment. "I have not a cent left," observed °ne> "But never mmdi Let's go "shopping," and, springing into a motor car, she whirled away. AN ALL-NIGHT VIGIL. The run on the Knickerbocker Trust was promptly transferred to another first-class institution, the Trust Company of America, usually considered a well-go-verned, conservative concern, with deposits aggregating 50,000,000' dollars. It had nearly £3,000,000 m cash m its cof--fers, and was promised and received the united assistance of the clearing-house and the banks. .' , All day on Wednesday hundreds stood m line waiting to reach the paying tellers, and even- at. the end of the day the line stretched two blocks down the street. During the day over 5,000,000 dollars were paid out. . The run continued on the following day, but the company still hoped to weather the storm. Hundreds of determined depositors maintained an all-night vigil m front of the main office, huddled together iri the shivering^ icy, but jafraidJ\to lea ve_ the queue. One " depositor "camped all night m a- hansom with his wife, mother, two children, and' a. bag of provisions. He' was the first to react . the counter next day, and met his reward. Others placed , camp stools on the pavement, while negroes sold hot coffee to the miserable "throng" at the rate of lOd a cup. When tlie doors were opened, the cashier's counter made a spectacular display -ot wealth. A double row of clerks were ready to pay' depositors with huge piles of notes and cash. The president of the company shouted to the depositors, "Take your r time; we are going to pay you all." But public confidence had become/ demoralised. Other institutions were soon attacked. Several smaller banks,- against whose management and stability nothing could be justly said, were victimised by the suspicion attaching to the more pretentious houses. The Dollar Bank was besieged by 1500 excited Italians, Swedes, Poles, and Germans. Most of thetcrowd had been waiting since daylight, and not a few had arrived before it was light. They Mere fairly quiet until near operi- : ing time, and then began fighting for nearest to the entrance. Many m the swarm were women with infants ln their arms, and some babies were lost m the confusion. -When the door opened a great Tush commenced, and cursing and fighting marked the frantic endeavor of the excited foreigners to collect their money. Everybody was paid, by the afternoon. Cases of depositor^ being robbed by street thieves were reported.' The Night and Day Bank stated that a messenger they employed to cash a cheque for £1300 at the Knickerbocker Company got the money and never returned. Before leaving, he wrote a facetious letter home, saying, "Things look so depressed m New York that I'm going to take to the woods." ..''•' A STRANGE SIGHT. Another institution attacked was the Bowery Savings Bank, an establishment as sound as tlie Bank of England. The sight was a strange one. Lined up outside tlie building were some 50 Greeks, Italians, and Armenians. All had the implements of their trade with them. The Greeks earned trays of hot peanuts, the Italians bunches of bananas ; the Armenians, who are generally bootblacks, their paste-boxes and brushes. All wanted their savings. The interior of the bank was stuffy with malodorous fumes. Since nothing is more contagious than a money panic, public distrust Jtourly increased, though happily it was still chiefly confined to New lork. On the 23rd October panic-stricken crowds' were seen m all the financial districts, while near Wall street it was impossible to move, though a big force of police was on duty. Newspapers issued panic editions, which intensified the conditions. Some people sold places m a street queue for as much as £100. Messenger boys keeping places earned small fortunes. Meanwhile, Mr Cortelyou, Secretary to the Treasury, and the great 'financiers and bankers did their best to concert measures to re-establish confidence and allay the panic.

'The Taranaki News states : — In a lecture Mr Gilruth, chief Government Vete. i marian, advised farmers to cull out their tuberculosis cattle now, whilst prices are low, and not to defer action until their herds are composed of more valuablee beasts. A correspondent asks us what guarantee a farmer has that the fancypriced stock now being imported is free from tuberculosis. He says that at the recent sales no purchaser asked for a guarantee or assurance that the purebred stock offered should pass the tuberculin test, and suggests that some such guarantee should he made compulsory. Mr H. Okey, M.H.R., complained that the amount of money set aside by the Government for payment of compensation to farmers for. the slaughter of diseased stock was altogether insufficient. Last year it was only about £4000. Mr Gilruth said that that was £4000 more than was paid by any other country He considered that some fanners, who took every penny they "could get out of a dairy cow and then handed the emaciated carcase over to the Government and" daimed compensation, should get a term m gaol rather than compensation.