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COMMERCIAL CHRONICLE AND REVIEW.

THE COMMERCIAL EMBARRASSMENT OF ENGLAND OWING TO THE UNSKILFULNESS OF HER MO

NIED INSTITUTIONS-IMPORTS AND EXPORTS OF THE UNITED STATES, IN 1847-INFLUENCE OF EUROPEAN COMMERCIAL AFFAIRS ON THIS COUNTRY-COINAGE-CONDITION OF THE NEW YORK CITY BANKS IN AUGUST AND NOVEMBER, 1847-THE COUNTRY BANKS-DIVIDENDS OF NEW YORK BANKS FOR SEVERAL YEARS-LIST OF FAILURES IN EUROPE TO 19TH NOVEMBER-MODE OF TRANSACTING BUSINESS BETWEEN ENGLAND AND THE UNITED STATES-RATES OF BILLS OF EXCHANGE, ETC., ETC.

THE past has been an eventful era in the history of commerce, and the last six months will be memorable for the discredit into which England has fallen in regard to the rest of the world. The continued difficulties in England, growing out of causes to which we have before alluded, have produced their effect to a greater or less extent upon the United States; and, in the midst of unexampled prosperity, the commercial community were suddenly deprived of their usual facilities, and the solvency of many firms jeopardized, while some few gave way to the pressure. After a year of such unparalleled trade as has been enjoyed, the condition of merchants generally was sound, and there was no valid reason why they should so suddenly have been cut off from the resources on which, unfortunately, they commonly rely to meet their obligations. If the merchants, as a body, are dependent upon corporate institutions for facilities in their business, it is certainly the province of those institutions to understand the general operation and effect of commerce, and to exercise great foresight and circumspection in the conduct of their affairs. It does not appear, however, that there has in any degree been exercised that skilfulness in the management of money affairs that the public have a right to expect at this day; and to this want of skill, to a very great extent, is to be ascribed the distress which the dealers have undergone in the last ninety days. The business of the Union, as we have remarked, has been of great magnitude during the past year, and uncommonly healthy. This is manifest in the official tables of the imports and exports of the Union, which give results as follows:

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This table gives the remarkable fact that the aggregate value of goods and specie imported was less than the exported value of domestic produce by four millions, and the aggregate exports exceeded the imports by the large sum of $12,102,984; which, were the import and export values the actual amounts realized from, and paid for goods, would, in addition to the very large earnings of the ships for freight, suppose serious losses to the national commerce. These returns were made up, however, to the close of June, to which time the prices in England had been well sustained, and the exports yielded doubtless considerable sums in excess of the valuation here. It is probable, however, that a much larger quantity than usual went forward on foreign account; by reason of which, the export value would represent more nearly the actual amount realized to the coun

try by the sale of the produce; yet, it would seem that, after the close of the fiscal year, a large sum was due the country—a supposition sustained by the low rates at which exchanges ruled at the close of the year. The amount of bills running upon England was very considerable; and, as the imports continued large, as the fall season progressed, the demand for them increased in a manner to raise their value as a remittance. Two circumstances, however, grew out of the revulsion in England, which tended to deprive the market of bills as a means of discharging the debts due England. These were the diminished prices and purchases of produce in England, and the discredit of the houses on which the bills were running. By these means, very considerable sums due the United States by England, ceased to be applicable to debts due England for goods. In the phrase of the stock market the "mutual contracts would not apply." If England, from any cause, faltered in her payments, the United States continued theirs. When British credits were no longer a reliable remittance, importers fell back upon specie, and the banks became immediately endangered. Their danger consisted in the extent to which specie would be substituted for discredited bills, until the maturity and payment of the latter should return the precious metals to the bank vaults. During the year, the movement of specie had been immense. The imports were, as seen above, $24,121,289; of this, $22,276,170 had been retained in the country, and nearly all coined into American money. The federal government, during the eleven months ending with November, has for loans and dues received $48,667,886 in specie, and disbursed it, making an amount of $97,335,772; of this amount, $23,000,000 was mostly in foreign coins, sent to the mint for coinage. While this immense movement of specie has taken place, the amount in the New York banks varied from $7,798,186, August, 1846, to $8,103,499, August, 1847; an increase of $305,313 only, although their loans had swollen much beyond the movement of last year. The specie held by the banks was not American coin, but mostly those foreign coins best adapted to exportation. Hence, when the packet of the 4th of August brought news of the English failures, and each succeeding boat brought more disastrous news, it became very evident that, in default of bills for remittance, the specie in the banks would be resorted to, and they had not increased their store during a year of large imports, nor had they protected themselves against an export demand, by changing their foreign coin into American money. Hence, it became probable that a serious drain would result, and it was their duty to prepare for it by a gradual curtailment of their extended loans. In our October number, in speaking of the returns of the city banks for August, as compared with the previous November, we remarked:

"The city banks have increased their loans nearly 20 per cent, while a diminution has taken place in those of the country; yet a great increase has taken place in the circulation of the latter. This large amount of city loans produces an extra demand for money, and causes tightness in the market whenever the banks loan less than they receive, and this is always the case when they have reached a maximum."

The line of discounts in August was immense, as compared with former experience; and, while the aspect of affairs was such as we have described it, it was the duty of far-seeing and sagacious bankers to have prepared for it by commencing a gradually stringent policy-simply by being less liberal than before. This appears not to have been attempted at all. The following is a table of the city bank returns, comparing the loans of each bank, August and November :

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LEADING FEATURE OF NEW YORK BANKS FOR NOVEMBER, 1847.

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Loans.
Dollars.
3,598,791 2,777,201
3,773,440 3,515,386
4,656,884 4,020,255
2,380,913 2,124,156
3,826,240 3,128,389

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93,034

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215,464

193,905 1,004,179

171,024 236,413

856,598

477,568 457,564

33,760 154,165.

205,298

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66 November.....

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2,294,528 2,144,951
1,096,988 1,051,424
999,348 997,023
2,496,678 2,211,687

48,030,987

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145,585 300,762 544,949

156,255 260,708 586,151 546,842 484,346 1,530,639

43,733,010 8,103,499 7,606,581 25,757,061 48,030,987 10,769,732 6,838,475 27,892,482 38,533,810 7,113,070 6,192,514 22,812,755 40,390,248 7,798,186 5,926,881 21,166,623

The course of business, it appears, is generally for the city banks to curtail in the November quarter, and for the country banks to expand. The former are exposed to a prompt demand for specie, and the latter are without any guide. It appears that the city banks, for the November quarter, 1846, contracted their loans $1,856,438. In the same quarter this year, with every reason for greater cir cumspection, they reduced the amount but $4,297,977-that is to say, in November, 1847, after three months of anxiety and alarm, in which individual merchants were too prudent to trust sterling bills, and the banks in consequence had lost $2,666,233 of their specie, their loans were $5,199,200, and their circulation $1,414,067 higher than on the same day of the previous year. The deposits were $2,944,306 greater. The liabilities for deposits and circulation were $4,358,373 higher than in November, 1846, and this was based on $5,199,200 more, of loans due the banks. In this position they suddenly took an alarm at the amount of specie shipped between the 1st and 16th of November, and rigorously curtailed their movements, refusing the most undoubted paper. The specie, in some cases, had, indeed, been reduced alarmingly low; some that had reported over $700,000, now were brought down to $200,000. The specie in all the city banks was reduced to less than $5,000,000 in the second week in December. The commercial public have, however, great reason to complain of this conduct; the more so, that the affairs of the banks for three months remain entirely concealed from each other, as well as from the public. The country banks of the State made returns for the same period as follows:

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It is observable that the movement of those institutions is the reverse of those in the city; and that they enhanced their loans $3,815,826 in that quarter of anxiety. Now, the country banks and merchants take their cue to a great extent from the city institutions. If they loan liberaliy, as they did through the November quarter, the country banks do so likewise, and the merchants enter freely into obligations. The city banks are governed by the specie movement; and that, under the absurd system of secrecy, each institution only knows of itself, and what directors tell each other privately. When, as in the November quarter, they act erroneously, and lead the community into extended obligations, and then turn suddenly round, influenced by panic, and refuse to lend at all, the commercial community is ruthlessly sacrificed to a false system. Had the city bank returns been published weekly, as was desired of the legislature by leading houses, the constant drain of specie, as each successive packet admonished of, increasing cause of distrust, prudent merchants would have restrained their operations; and the banks of the State, instead of having a discount line of $80,000,000, would not have reached $70,000,000, November 1st. This would not have operated so well for bank profits, but it would have been cheaper and safer for the public. The packets of November 4th and 19th brought advices of some amelioration in the market of London, with some advance of breadstuffs and firmness in cotton, with such general advices as should have imparted more confidence in bills. Unfortunately, however, she brought news of the failure of a French house, the branch of which here had sold francs to some extent, taking notes in payment, which notes had been discounted by some of the banks; and this circumstance, added to their panic, making them still more rigorous in their movements, the best paper of the city was hawking about at 11 a 1 per cent per month interest; and, in some instances, even higher. In some cases, large amounts of good paper was offered for small sums at this rate. The dividends of the institutions for the past year have been as follows:— DIVIDENDS OF THE NEW YORK BANKS FOR 1844-5-6-7.

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Total........... 23,084.100 6.13 1,373 600 6.31 1,433.907 7.09 1,554,912

* Dividend paid May and November. † Dividend paid June and December. Dividend paid February and August. § Dividend paid April and October. | Dividend paid January and July.

45,850 31 3 40.000 5 5 60,000 5 5 37,500 4 5 14.000 4 4 48.750 3 3 52.500 3 4 42.000 3 31 30,000 3131 120.000 3 3 196.405 3 3 41.210 4 4 69.324 3 3 3 3

45.850 31 4

45.850

40,000 5 10

60,000

60.000 5 5

60,000

45,000 5 5

50.000

16 000 41 5

19.000

52,500 3 4

53.750

56.250 4 4

60,000

42 000 31 31

42.000

35,000 31 31

35,000

120.000 3
206,850 3 31
50.560
69.324 3
61,500

120.000

223.871

2120

80,878

1,572,173

The Mechanics' Association was obliged to pass a dividend, as also the Manhattan, which works but slowly out of its difficulties.

The advices from England, down to the 19th of November, were of some relief in the market, produced mainly by the arrivals of specie from all quarters, which the fictitious operations in exchange had brought about. There were no signs, however, that the great causes of the late revulsion were permanently removed, or that it had yet spent its force. Although the failures were no longer of great magnitude, they still continued. In our last we gave the list down to the 4th-the following are the names to the 19th:

Abbott, Nottingham, and Co., wareh'semen, London.
Ainsworth, David, manufacturer, Manchester.
Arkell, A., Stock Exchange, London.
Blake, G. and J., soapboilers, Liverpool.
Brancker, J. B., and Son, brokers, Liverpool.
Breebaart, N., merchant, Amsterdam.
Carter and Baines, merchants, Liverpool.
Campbell and Batty, yarn and goods ag'ts, Glasgow.
Clarke, J. P., merchant, Leicester.

Cohen (Judah) and Sons, W. I. merchants, London.
Coleman and Todd, sharebrokers, Liverpool.
Cowsill, P., calico printer, Manchester.

Ewing, Anderson, and Aird, merchants, Manchester,
Glasgow and Calcutta.

Farrand, Robert, corn factor, London.

Figgis and Oldham, wholesale druggists, Dublin.
Flood and Lott, bankers, Honiton.

Gundry and Co., bankers, Bridport.
Hargreaves and Co., merchants, Liverpool.

| Johnson, Cole, and Co., E. I. merchants, London.
Just, Z., manufacturer, Manchester.

Kaye, William Henry, merchant, Huddersfield.
Kershaw, Holland, and Co., manufact'rs, Manchester.
M'Kenzie, D., jun., East India merchant, Glasgow.
Marsland, Veltmann, and Co., Manc. and Stockport.
Napier, David, ironfounder, Glasgow.
Ogilvie, Clark, and Co., comm. agents, Glasgow.
Palengat and Co., corn merchants, Bayonne.
Pattison and M'Gibbon, calico printers, Glasgow.
Pendleton, J. T. Harvey, merchant, Manchester.
Rotham and Co., bankers, Amsterdam.
Roothaan and Co., bankers, Antwerp.
Rupe, J. H., and Son, sugar refiners, Amsterdam.
Ryder, Wienholt, and Co., E. I. merchants, London,
Thurburn and Co., East India and Egyptian mer-
chants, London.

Trueman and Cook, brokers, London.
Young, G. and C., calico printers, Glasgow.

It is to be remarked that the names given, come under the general head, “merchants and bankers." The failures in smaller operations are much more numerous; as thus, from the 6th to the 17th November, inclusive, there have been gazetted in England 116 bankrupts, and 62 insolvents; and in Scotland 30 bankrupts.

It is natural that the non-payment of a vast number of bills drawn on England and sent back to the colonies, as well as other countries, together with the failure of so many firms, greatly diminishing the demand for money, while the receipt of specie for debts due England was increasing the supply, should produce ease. In fact, England was collecting debts and paying nothing; hence an apparent ease in the market was produced. At the date of our last, we mentioned that the government had authorized the Bank of England so far to violate the charter act of 1844 as to issue notes in excess of the amount secured by the stock and bullion in the issue department. It appears, however, that the bank prudently abstained from using that provision prior to the meeting of Parliament, which was called for the 18th of November, and proceeded to business on the 23d. The French loan of 250,000,000 francs was also adjusted by the award to the house of Rothschild, who took it at 75.25 for a 3 per cent stock, payable in instalments of 12,500,000 francs each for November and December, and 10,000,000 francs per month thereafter until the whole should be closed. This would require twenty months to complete the payments, and the interest on the whole amount was to commence at once. The announcement of this loan, spread over a long time, and the favorable nature of its terms to the government, produced a better feeling, and made the markets of the continent easier; so much so, that a great deal of paper that would command money at 8 per cent per annum in London, was discounted in Amsterdam and other cities at a much less rate. All those circumstances only produced temporary relief. The facts that a great deal of food would

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