Article Text
SLUMP AND PROSPERITY. AS RIDGELY SEES IT. A Plain Talk at the Bankers' Convention. [ntr TELEGRAPH TO THE TRIBUNE.] & SantFrancisco, Oct. 22.-The noteworthy feature of the second day's session of the American Bankers' Association Convention was the elaborate address by William B. Ridgely, Controller of the Currency. He called out much applause by his peroration, in which he declared that the course of business to-day depended largely on the bankers. If the bankers acted wisely and conservatively they could avert anything like serious trouble. The speculations, promotions and combinations that had run their wild course, he declared. were caused by, and were not the cause of, prosperity, but the advance of country should not and would not cease because "the speculative attempts to discount the future and overcapitalize earning power has met with foreordained and inevitable failure." A series of five-minate talks by delegates from the various States, in which each reported on the financial condition of his territory, bore out the optimistic tone of Controller Ridgely's address From Maine to California and from the Great Lakes to the Gulf delegates gave accounts of the great increase in the productive power of their State industries and of the consequent prosperity of the banks. The convention was greatly impressed with this testimony from a body of trained experts, and as each sat down after adding his mite to the general report of prosperity and growing business there was hearty applause That the fidelity insurance system was not defeated permanently yesterday was shown today when a resolution was introduced for perpetuating the fidelity insurance investigation committee The executive council recommended It promptly, and the convention adopted It. This assures the matter coming before the convention next year, when the advocates of the system promise that all the delegates will be thoroughly informed in regard to the merits of the plan. Every day since the convention has been in session the telegraph has brought the report of a failure of some large Eastern bank. This serial story of bank failures has become a standing joke among the delegates. But all admit that the failures have been due to bad business methods, and not to any decrease of prosperity. W O. Jones, of the National Park Bank of New-York, in commenting on the latest failure to-day said that John Thompson, president of the defunct First National of Allegheny, had tried to get a charter for Pittsburg, but had failed. Then he went to Allegheny and bought up the charter of a small bank and developed it into the First National. Mr. Jones said that he had attended eighteen bankers conventions in different States this year. To-morrow will see the close of the convention with an address by United States Treasurer Ellis H. Roberts on "The Effects of the Inflow of Gold." Then several days will be given up to excursions and about half the party will return by way of Los Angeles. The New-York delegates have had a good time here, as they have been the guests at many social affairs. Controller Ridgely's speech was in part as follows: During the years of very active and prosperous business which we have had since the country began to recover from the depression following the panic of 1893, there has been a very marked improvement in the fundamental condition of our people and the amount of both capital and wealth they have produced and saved Our prosperity in business has been based on the very best foundation. It has been the result of the most legitimate causes and forces, and all these are not only still in operation, but give every evidence of continuance. As is always the case, however, in such times, this movement of activity has been accompanied by a large amount of speculation, not only in stocks, bonds and securities but in many other lines, and credits have become more and more expanded. In stock speculation and promotion especially we have gone too fast. with the inevitable result of serious collapse, and such a decline in prices that people are becoming alarmed and beginning to ask if this may not end the whole movement of prosperity This causes doubt and increasing hesitation in business circles There is also a demand for financial and currency legislation, or governmental aid in meeting the situation as it exists at the present time While these important questions are all more or less connected and interwoven, the bustness situation is not to any very great extent due to currency or financial causes and It is not to legislation we should look for permanent relief There is also a tendency toward recrimination and placing the blame for present business conditions on some one else for one section of the country to blame another for the West to say it is all the fault of the East and Wall Street Some very foolish people say they are glad to see the specuJators lose because they alone are to blame and the rest of the people will not be hurt There can hardly be any more mistaken view than this The ramifica of business in all parts of the world are 80 intricate and far reaching that what affects the money market in any large way reaches us all It is true that there has been overspeculation much of it wild and foolish some of it fraudulent and dishonest It does no good however, to scold and blame the speculator He always follows and participates in such a movement and always will until human nature changes The purely gambling speculation on margins is only the fringe of the great trading and dealing in stocks and sec rities in Wall Street which necessary part 01 modern business Do not misunderstand me as defend. ing or even excusing this speculation There is entirely too n such of and 100 many business and professional men bankers and bank officers have been tempted and acquired the habit of speculation during the last few years of rapidly advancing prices It should be stopped if there is any way to do It. and you as bankers can do as much to discourage if not to prevent it as any one can This sort of speculation however is not by any means chief or leading factor in the situation The whole movement since the revival in business came has been more or less speculative and just as business has been unduly depressed and prices lower than they should have been we have gone to the other extreme Wall Street and the speculators are perhaps not NO very much more to blame than the rest of the country here is the man or the bank entirely free from SID to cast the first stone You may not speculate on the Stock Exchange or underwrite promotions, but It will be hard to find the bank whose officers or chief customers are not in some local promotion or combination which is more or less speculative properly enough too in many cases perhaps for It is often one the best services a bank can render its own community to encourage local enterprises which are legitimate and which are to be honest and competent hands This is no time for any feeling or discussion be. tween different sections of the country classes of people or lines trade as to who is most to blame or who can stand it best We are all face to face with the situation and equally interested It is no time for passion or excitement panic or fear but for quiet calm consideration courage and firm action based on good judgment and conservatism Considering all the circumstances and the pace at which business has been going for the last few years, It not 80 surprising that there has been such a decline in the prices of securities. but rather that the country has stood It all 80 well and that there has been no panic 80
