TABLE NO. 3.

UNITED STATES TABLE OF BALANCE SHEETS OF THE NATIONAL BANKS—QUARTERLY STATEMENT. MILLIONS OF DOLLARS.

———+———-+———-+———-+———-+————-+———-+———-+———-+ | |SPECIE | | DIS- | INDIVI- |NUMBER | |SURPLUS| |CIRCU- | ON | LEGAL | COUNTS| DUAL | OF | |AND UN-| YEAR |LATION | HAND |TENDERS| AND | DEPOSITS| BANKS |CAPITAL|DIVIDED| | | | | LOANS | | | |PROFITS| ———+———-+———-+———-+———-+————-+———-+———-+———-+ |MAX MIN|MAX MIN|MAX MIN|MAX MIN|MAX MIN|MAX MIN|MAX MIN|MAX MIN| | | | | | | | | | 1865 | 66| 4| 72| 166| 183|1500 |393 |20 | 2nd Q| | | | | | | | | 3rd "| |18 |189 | | | | | | 4th "|171 | | |487 | | | | | 1866 | | | | |500 | | | | 2nd "| 213|19 |187 |500 | | | | | 3rd "| | | | | 522|1644 |415 |71 | 4th "|280 | | | | | | | | 1867 | | |205 |603 |564 | | | | 2nd "| | 9| | |558 | | | | 3rd "| | | | | 512|1642 |420 |86 | 4th "|293 | | 92| | | | | | 1868 | |20 |114 |609 | 532|1643 |420 |101 | 2nd "| | | 84| | | | | | 3rd "| | | | | | | | | 4th "|295 | | | | | | | | 1869 | |29 | | | |1617 |426 |116 | 2nd "| | | |657 |580 | | | | 3rd "| | | 80| | | | | | 4th "| |48 | | | | | | | 1870 | | | |686 |574 | | | | 2nd "| | | |688 | 511|1648 |430 |124 | 3rd "| | 18| 94 79| |546 | | | | 4th "|296 | | | | 501| | | | 1871 | | | |725 | | | | | 2nd "| | |122 | | | | | | 3rd "| | 13| 93| | |1790 |458 |140 | 4th "|318 | | 97 | | | | | | 1872 | | | |831 |611 | | | | 2nd "| | |122 | | | | | | 3rd "| | 10| | | |1940 |479 |147 | 4th "|336 | | | |620 | | | | 1873 *| | | | | | | | | 2nd "| | 16|10 97|885 |656 | | | | 3rd "|339 | 19| | |622 616|1976 |491 |153 | 4th "|341 |33 | 92|944 | | | | | 1874 | | |103 | | | | | | 2nd "| | 21| | 836| 540| | | | 3rd "| | | 80|897 | 595|2027 |493 |173 | 4th "| 331| | |955 |682 | | | | 1875 | | | | |695 | | | | 2nd "| | 8| |984 | |2087 |504 |182 | 3rd "| | | | | 618| | | | 4th "| 314| | 70| | | | | | ———+———-+———-+———-+———-+————-+———-+———-+———-+ *PANIC YEARS

MILLIONS OF DOLLARS. ———+———-+———-+———-+———-+————-+———-+———-+———-+ | |SPECIE | | DIS- | INDIVI- |NUMBER | |SURPLUS| |CIRCU- | ON | LEGAL | COUNTS| DUAL | OF | |AND UN-| YEAR |LATION | HAND |TENDERS| AND | DEPOSITS| BANKS |CAPITAL|DIVIDED| | | | | LOANS | | | |PROFITS| ———+———-+———-+———-+———-+————-+———-+———-+———-+ |MAX MIN|MAX MIN|MAX MIN|MAX MIN|MAX MIN|MAX MIN|MAX MIN|MAX MIN| | | | | | | | | | 1876 | | | | | |2089 |499 |184 | 2nd Q| | 21| | | 612| | | | 3rd "| | | | | | | | | 4th "| 291|32 |90 | | | | | | 1877 | |49 | 66| 929| | | | | 2nd "| 290| | | |659 |2080 |479 | | 3rd "| | 21| | | | | |167 | 4th "| | | 66| | | | | | 1878 | |54 | | | | | | | 2nd "| | 29| | 881| 604| | | | 3rd "| | | | |625 |2053 |466 |165 | 4th "|303 | | | | | | | | 1879 | |41 | 54| 826| 588| | | | 2nd "| | | | 814| |2048 |454 |153 | 3rd "| | | | | | | | | 4th "|321 |79 | 54|933 |765 | | | | 1880 | | | | | | | | | 2nd "| |86 | | | | | | | 3rd "| |109 |64 |974 | |2090 |457 |159 | 4th "| 317| 105| |1040 | | | | | 1881 | | | 52| |1000 | | | | 2nd "| 298|128 | | | 932|2132 |463 | | 3rd "| | | | | | | |176 | 4th "|323 | | | | | | | | 1882 | | 109| |1100 |1100 1000|2268 |483 | | 2nd "| |112 | | | | | | | 3rd "| | 102| |1200 |1122 | | |191 | 4th "|315 | |68 | | | | | | 1883 | | | | | | | | | 2nd "| | 97| | | | | | | 3rd "| 304|115 | | | | | | | 4th "| | | | | 1000|2501 |509 |196 | 1884 *| | |80 |1300 |1100 | | | | 2nd "| |109 | 75| | |2664 |524 | | 3rd "| 289|128 |77 |1306 | | | |209 | 4th "| |167 | | 1200|1000 975| | | | 1885 | | | | | | | | | 2nd "| |177 |79 | | | | | | 3rd "| | | 69| 1200| |2714 |527 |206 | 4th "| 268| | | |1100 | | | | 1886 | |171 | 62| | | | | | 2nd "| | 149| |1470 |1152 |2852 |548 | | 3rd "| | | | |1172 | | |212 | 4th "| 202| | | | | | | | 1887 | |171 |79 | | |3049 |578 | | 2nd "| | | 73|1587 |1285 | | |231 | 3rd "| | | | | | | | | 4th "| 164| 159| | | | | | | 1888 | | 172|83 | | | | | | 2nd "| |178 | | | | | | | 3rd "| | | | | |3120 |588 | | 4th "| 151|182 | | | | | |246 | 1889 | | | 81|1684 |1350 | | | | 2nd "| | |97 | | |3170 |596 |269 | 3rd "| | | | | | | | | 4th "| 126| 164| | | | | | | 1890 *| |171 | 84|1811 |1436 | | | | 2nd "| | | | | |3383 |626 |290 | 3rd "| |178 | | | | | | | 4th "| 123|190 | | | | | | | 1891 | | | 82|1932 |1521 | | | | 2nd "| | | | | 1483|3601 |662 |316 | 3rd "| 123|199 | | |1575 | | | | 4th "| | |100 |1962 |1525 | | | | ———+———-+———-+———-+———-+————-+———-+———-+———-+ *PANIC YEARS

MILLIONS OF DOLLARS. ———+———-+———-+———-+———-+————-+———-+———-+———-+ | |SPECIE | | DIS- | INDIVI- |NUMBER | |SURPLUS| |CIRCU- | ON | LEGAL | COUNTS| DUAL | OF | |AND UN-| YEAR |LATION | HAND |TENDERS| AND | DEPOSITS| BANKS |CAPITAL|DIVIDED| | | | | LOANS | | | |PROFITS| ———+———-+———-+———-+———-+————-+———-+———-+———-+ |MAX MIN|MAX MIN|MAX MIN|MAX MIN|MAX MIN|MAX MIN|MAX MIN|MAX MIN| 1892 | | | | | | | | | 1st Q|141 |230 |99 |2044 |1702 |3711 |678 |330 | 2nd "| |239 | |2171 |1769 | | | | 3rd "| | |113 | | | | | | 4th "|145 | 209| | | |3784 |689 |353 | 1893 | | | | | | | | | 1st "| 149| | 90|2161 |1751 |3830 |688 |352 | 2nd "| | 186| | | | | | | 3rd "| 182| | | 1843| | | | | 4th "| |251 |131 | | 1451| | | | 1894 | | | | | | | | | 1st "|174 |259 |146 | 1872| |3777 |678 | | 2nd "| | | | | | | | | 3rd "| 189| | |2007 |1728 | | | | 4th "| | 218| 119| | | | |339 | 1895 | | | | | | | | | 1st "| 169|220 | | 1965| |3728 |662 | | 2nd "| | | | | | | | | 3rd "| | | | |1736 | | | | 4th "|185 | 196| 93|2059 | | | |340 | 1896 | | | | | | | | | 1st "| 187| 196| |1982 |1687 |3699 |653 | | 2nd "| | |118 | | | | | | 3rd "| | | | | | | | | 4th "|210 | | 110| 1893| 1597| | |342 | 1897 | | | | | | | | | 1st "|202 | 233| | | 1669|3634 |642 | | 2nd "| | |126 | | | | | | 3rd "| | | | | | | | | 4th "| 193|252 | 107|2100 |1916 | | |341 | 1898 | | | | | | | | | 1st "| 184| 271|120 | | |3594 |628 | | 2nd "| | | | | | | | | 3rd "| | | | | | | | | 4th "| | | 110|2214 |2225 | | |340 | 1899 | | | | | | | | | 1st "| |371 |116 | | | |608 | | 2nd "| 199| | | | | | | | 3rd "| | | | | | | | | 4th "| | 314| 101|2496 |2522 |3602 | |363 | 1900 | | | | | | | | | 1st "| 204| 339| 122| | | | | | 2nd "| | | | | | | | | 3rd "| | | | | | | | | 4th "| | |145 |2706 |2623 |3942 |632 |403 | 1901 | | | | | | | | | 1st "| 309|399 | | | | | | | 2nd "| | | | | | | | | 3rd "| | |164 | | | | | | 4th "| | 369| 151|3038 |2964 |4291 |665 |448 | 1902 | | | | | | | | | 1st "| 309| | | | | | | | 2nd "| 309| |164 | | | | | | 3rd "| | | | | | | | | 4th "| | 366| 141|3303 |3209 |4666 |714 |516 | 1903 | | | | | | | | | 1st "| 335| | | | | | | | 2nd "| | |163 | |3200 | | | | 3rd "| | | | | | | | | 4th "| | 378| 142|3481 | |5118 |758 |564 | ———+———-+———-+———-+———-+————-+———-+———-+———-+

MILLIONS OF DOLLARS. ———+———-+———-+———-+———-+————-+———-+———-+———-+ | |SPECIE | | DIS- | INDIVI- |NUMBER | |SURPLUS| |CIRCU- | ON | LEGAL | COUNTS| DUAL | OF | |AND UN-| YEAR |LATION | HAND |TENDERS| AND | DEPOSITS| BANKS |CAPITAL|DIVIDED| | | | | LOANS | | | |PROFITS| ———+———-+———-+———-+———-+————-+———-+———-+———-+ |MAX MIN|MAX MIN|MAX MIN|MAX MIN|MAX MIN|MAX MIN|MAX MIN|MAX MIN| 1904 | | | | | | | | | 1st Q| 380| 453| | | | | | | 2nd "| | | | | | | | | 3rd "| | |169 | | | | | | 4th "| |504 | |3772 |3707 |5477 |776 |594 | 1905 | | | | | | | | | 1st "| 424| |178 | | | | | | 2nd "| | | 157| | | | | | 3rd "| |495 | | | | | | | 4th "| | 460| |4016 |3889 |5833 |808 |632 | 1906 | | | | | | | | | 1st "| 498|492 |175 | | | | | | 2nd "| | | | | | | | | 3rd "| | | | | | | | | 4th "| | 459| 152|4366 |4289 |6199 |847 |687 | 1907 | | | | | | | | | 1st "| | |173 | | | | | | 2nd "| 543| | | | | | | | 3rd "| | | | | | | | | 4th "| |531 | 151|4678 |4819 |6625 |901 |749 | 1908 | | | | | | | | | 1st "| | | | | | | | | 2nd "| | |192 | | | | | | 3rd "| | | | | | | | | 4th "| 599|680 | |4840 |4720 |6865 |921 |779 | 1909 | | | | | | | | | 1st "| | |198 | | | | | | 2nd "| 615| | | | | | | | 3rd "| | | | | | | | | 4th "| |694 | 176|5148 |5120 |7006 |953 |825 | 1910 | | | | | | | | | 1st "| 667| | | | | | | | 2nd "| | | | | | | | | 3rd "| | | | | | | | | 4th "| |672 | 169|5467 |5304 |7204 |1004 |894 | 1911 | | | | | | | | | 1st "| 680| | 168| | | | | | 2nd "| | | | | | | | | 3rd "| | |185 | | | | | | 4th "| |761 | |5663 |5536 |7328 |1026 |930 | 1912 | | | | | | | | | 1st "| 704| | | | | | | | 2nd "| |769 |188 | | | | | | 3rd "| | | | | | | | | 4th "| | | |6058 |5944 |7420 |1046 |969 | 1913 | | | | | | | | | 1st "| 717|749 | | | | | | | 2nd "| | |189 | | | | | | 3rd "| | | | | | | | | 4th "| | | |6260 |6051 |7509 |1059 |1007 | 1914 | | | | | | | | | 1st "| 720| |201 | | | | | | 2nd "| |792 | |6357 |6111 |7493 |1057 |1003 | 3rd "|1018 | 746| | | | | | | 4th "| 848| 534| 128| | |7581 |1065 |1007 | 1915 | | | | | | | | | 1st "| 746| 591| 127|6499 |6348 |7599 |1066 |1012 | ———+———-+———-+———-+———-+————-+———-+———-+———-+

The adage "buy cheap and sell dear," or its practical equivalent—so scary and imitative are investors— Buy during the last of a selling movement and sell during the last of a buying movement , resolves itself, we venture to repeat, into: Buy when the decline caused by a panic has produced such liquidation that discounts and loans, after steady and long-continued diminution, either become stationary for a period or else increase progressively coincident with a steady increase in available funds; and sell for converse reasons .

These conclusions are also reached by our author through analyses of the Financial History of England, France, Prussia, Austria, etc. These I omit as unnecessarily wearisome to the reader since I give that of our own country. However, I will here quote the following: "What must be noted is the reiteration and sequence of the same points (faits) under varying circumstances, at all times, in all countries and under all governments," and also this table showing all the panics and their practical coincidence in the past eighty-five years, in France, England, and the United States.

France England United States 1804 1803 1810 1810 1813-14 1815 1814 1818 1818 1818 1825 1825 1826 1830 1830 1829-31 1836-39 1836-39 1837-39 1847 1847 1848 1857 1857 1857 1864 1864-66 1864 1873 1873 1882 1882 1884 (a 1889-90 (a 1890-91 1890-91 p 1894 p 1894 1893-94 p 1897 p 1897 1897 r 1903 r 19O3 1903 o 1907 o 1907 1907 x 1913 x 1913 1913 i i m m a a t t e e l l y) y)

Truly these thirteen panics in the three countries have been practically simultaneous and one common cause must have originated them. The only cause common to all was overtrading to such an extent that neither credit nor money were to be had, so that a forced liquidation or panic inevitably ensued.

The above table effectually does away with the theory that new tariffs are directly productive of panics. For most certainly new tariffs did not occur in England, France, and the United States just before or during all the panic years enumerated, and yet, practically simultaneously in free-trade England, high-protection France, and sometimes low-tariff, sometimes high-protection United States have panics occurred for eighty years.

But, as I have shown in a note attached to this Introduction, a new tariff or a general change of duties is apt to precipitate a panic, on account of the unsettling of business, and that the consequent shaking of credit adds its quota to the forces finally culminating in a panic cannot be doubted. As a matter of history with us, substantially new tariffs have always happened to be the immediate forerunners of a panic, and this I believe to be true in the case of other countries.

Why is this? Is it not because the people instinctively turn to tinkering at and changing their chief tax—the tariff—whenever they as a whole need financial relief; and have we not shown that such relief is needed almost every ten years, when the overtrading, inseparable from the development of all thriving communities has made the call for credit impossible to grant?

A new tariff may defer, or hurry, or, occurring simultaneously, will intensify a panic, but it may not hope to avert one when due: yet if its changes be very gradual, fixed and long predicted, and of a nature to bring about or confirm a judicious tariff for revenue only, they will materially help to put business on so firm and sound a basis that recovery from the inevitable, and approximately decennial panics, will be wonderfully expedited. Thus a new tariff is a quite accurate forewarning of a panic, and is also to no inconsiderable extent a contributory cause. (See foot-note on page 5, seq., Interrelations of Panics, Tariffs, and the Condition of Agriculture , etc.; and especially what is said of the panic of 1848, on page 10.)

M. Juglar has fully analyzed the three phases of our business life into Prosperity, Panic, and Liquidation, which three constitute themselves into the business cycle, that for forty years past (that is, since the present Bank of England Act, and practically since that of the Law governing the Bank of France, both of which then increased the required specie reserve) has been of about ten years. These ten years may be apportioned roughly as follows: say, Prosperity for five to seven years; Panic a few months to a few years, [Footnote: The panic after 1873 is the only one I know extending to anything like the length it attained. This may be ascribed to the immense development and consequent speculation, and to the inflation of the currency coming after the period about the Civil War.] and Liquidation about a few years.

I have already pointed out the signs of prosperity, of panic, and of liquidation, but in view of existing conditions perhaps it may be well to restate here the quite familiar fact that the completion of liquidation that precedes the beginning of another period of prosperity is characterized by lack of business, steady prices, and a marked growth in available banking funds.

[The various tables spread through this pamphlet are fully explained by their headings and the text.]

In conclusion I wish to express my thanks for the courtesy M. Juglar has extended me, and to state my appreciation of the motives, painstaking patience, and undoubted originality he has shown in explaining and executing so faithfully and with such genius a most laborious and yet spirited work. It is only justice that such an achievement should have been awarded a prize by the French Institute (Academy of Moral and Political Sciences) and have gained for M. Juglar the Vice-Presidency of the "Society for the Study of Political Economy."

DeCourcy W. Thom.

Wakefield Manor.