plicated. The doubt had so far been quelled, not without difficulty, that the different kinds of currency might not be maintained on an equality with each other, and that one portion might fall below gold value. The constant apprehension was, so long as then-existing legislation remained in force, that the unit of existing monetary relations would be changed. Such an apprehension is the surest ground for panic which can be offered. The panic which resulted when this fear became more specific was not a bank panic, nor a crisis in which the banks had any responsibility. When it broke out, important weakness was developed in the banks south and west of the Potomac. National and State banks to the number of 360 suspended, of which 343 were in that section. In a number of cases these failing banks were connected with each other in a way to remind us of the old combinations of weak or rotten institutions linked together for mutual support, resulting in common collapse. The fact was also developed by the temporary and very short suspension of a number of the banks that the attempt to use their reserve funds in the redemption cities had been carried too far, and that they were at the mercy of any financial storm which might arise from causes far outside of their responsibility, and which might precipitate demands on them so suddenly that the agencies of steam and telegraph would not avail to call home their funds in time. Such a fear as existed lest some part of the currency would lose value produced the most sudden and intense contraction which could possibly be operated, and the banks contributed to intensify this, so far as they suspended cash payments upon a weak and unfounded assumption of necessity, instead of meeting it with courage. This occasion enforced once more the most positive and direct lesson which we have learned in regard to panics, that the one way to quell them is to meet them fearlessly and in face.[1]
The clearing house certificates issued at New York between June 21 and November 1, 1893, amounted to $41,490,000. The largest amount outstanding at any one time was, from August 29th to September 6th, $38,280,000. The issue at Philadelphia was $10,965,000; at Boston, $11,445,000. The deposits, which had been increasing at New York City, amounted, February 4, 1893, to $495.4 millions. From that point they steadily decreased until August 19th, when they were $370.3 millions. After the crisis was over they immediately began to increase again, and on December 22d they were $498 millions.
From 1883 to 1893 the annual number of failures was about 11,000, the average liabilities per failure about $12,000, the assets about fifty-two per cent. of the liabilities. In 1893, the number of failures was 15,508, the average liabilities per failure, $24,632, the percentage of assets to liabilities, sixty. In 1894 and 1895 the failures continued numerous (12,721 and 13,013), but the average liabilities per failure were nearly at the former rate; still the percentage of assets to liabilities remained high, 53.7 and 55.7 per
- ↑ Noyes, The Banks and the Panic of 1893.
