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proved 7 fatal to all the business interests of the country, commercial affairs had been pursuing the even tenor of their way on the highroad to prosperity. Everything pointed to a still more prosperous figure. The mania for building railways had apparently been nipped, if not in the bud at least before it had extended too greatly the country's credit, and, although there were several hundred millions of foreign capital in use, in case of its being recalled the home market could register the bonds which represented it at half the par cost. The wisest Solomons of banking saw no indications of the coming storm in the commercial skies. When, on the 8th of August, the loans reached the unprecedented height of $122,000,000, even then a reduction of $10,000,000 or $12,00,000 during the autumn months without injury to commerce was declared possible. and in pursuance of this declaration the banks began to contract their loans. Never was an act followed by more fearful consequences. The prices of securities at the Stock Board imme diately fell. The failure of a heavy produce house, although accounted for by the depression of that particular interest in the market, and, the report of a defalcation in a leading railway company, caused a suspicion of a coming crisis to taint the public security, but failed to seriously affect the general confidence. On the 24th of the month the news of the suspension of the Ohio Life Insurance and Trust a Company came like thunder from clear sky. The financial circle vibrated to its center; banking officers, panicstricken by the suddenness of the blow, at once lost their heads. The days of '37 seemed once more upon them, and financial chaos was come again. Stocks and commercial paper were at once sacrificed at ruinous rates, other fail. ures were announced, and rumors exaggerated each calamity. The Clearing House report for August 29-the first after the suspension of the Trust Company-showed a reduction of $4,000,000 in the bank loans for the previous week. A defalcation was announced on the same day of $70,000 in one of the associated banks, and so great was the general mistrust, that other institutions immediately became suspected of similar dishonesty. The most substantial securities in the market sold for next to nothing at public sale, and while the regular discounts of bills by the banks had been nearly suspended, street rates for money on the most unquestioned securities rose to what was up to that time unheard of there, four and five per cent. a month, and money could not be had at any rate on ordinary promis+ sory notes and bills of exchange. Commercial house after commercial house, bankafter bank succumbed to thepanic. The panic extended through the entire country. The failure of the Bank of Philadelphia, was followed by that of the other banks of that city, and by those of Baltimore and the Southern Atlantic States generally, The panic was no respecter of persons. Merchants, bankers and moneyed corpora tions, and manufacturing companies were swept down without distinction. Commercial business was everywhere suspended; the purchase and transportation of produce entirely ceased, and the climax only was reached when on the 14th of October, the bank suspensions of New York and New England took place. For this almost 8 universal suspension the banks could not claim the want of faith among the depositors to be the cause. Despite t the distrust that early began to affect the entire country, the depositors stood well by their guns, and not till
