Music Trade Review

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THE MUSIC TRADE REVIEW.
EDWARD LYMAN BILL
Editor and Proprietor.
PUBLISHED
EVERY
SATURDAY
3 East 14th St., New York
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NEW YORK, AUGUST 8, 1896
TELEPHONE NUMBER 1743. — EIGHTEENTH STREET.
••THE BUSINESS MAN'S PAPER."
BANKS AND BUSINESS.
HE editorial which appeared in last
week's REVIEW anent the position
assumed by banks toward manufacturing
enterprises seems to have met with wide-
spread approval. The relation of mon-
eyed institutions to industry is an all
important one, and the subject can be
dwelt upon at length, as it never ceases to
afford new interest and the absolute neces-
sity for the existence of both is an undis-
puted fact.
In studying the situation we are im-
pressed with the patriotic attitude recently
assumed by cur banks towards the main-
tenance of the gold reserve of the National
Treasury. Such action as they have taken
is most praiseworthy, and cannot be too
warmly extolled. It shows plainly that the
moneyed institutions of America do not hes-
itate at times to step into the breach, and
by their prompt action render innocuous the
financial panic which temporarily threat-
ened the country.
It is only fair to say that their actions in
T
this were generated by a feeling of com-
mendable patriotism.
Now, why not go a step further?
They have extended financial aid to the
Government in its time of need, and why
not adopt a like policy towards the business
institutions of our land ?
For what, after all, is the National Gov-
ernment but a big business institution in
which every citizen has an interest?
They help the one—why not adopt a
more liberal policy towards the other?
The success of this great country is de-
pendent to a large extent upon its manu-
facturing interests. Manufacturing suc-
cess and Governmental success are synony-
mous. They are closely linked. When
the manufacturing interests of America
thrive then there is no monthly deficit in
Government receipts—its disbursements
do not exceed its revenues.
Banking institutions do not hesitate to
come to the assistance of the Government;
why should they hesitate to supply the
necessary lubricator for trade when its ma-
chinery is rusting for want of oil?
The conditions are much different to-day
than in 1893, when the panic first began.
Then the banks themselves were unpre-
pared for the tremendous and sudden de-
mands made upon them. To-day the
situation has radically changed since the
panicky days of '93. Then the-banks had
not the money at their disposal to adopt a
policy towards their customers which
would have, in a measure, checked the
panic at its very inception.
To-day they have the money, but main-
tain a close grip upon it when considering
the industrial affairs of this country.
Their attitude stagnates trade, and ren-
ders the failure of many a solvent concern
possible. While the banks are glutted with
money, trade is starving for the lack of it.
What matters how the bank vaults are
bursting with coin while industry lies pros-
trate ?
The very root of our present stagnancy
lies there. If American money merchants
—for that is really what bankers are^—keep
their wares stored away, earning nothing
for themselves or their stockholders, how
can they expect that their foreign breth-
ren, who control the great money markets
of Europe, will place the cash of their in-
vestors in American securities?
If we ourselves have not confidence in
our own domestic affairs, how much can
we hope to inspire confidence in others who
have been taught to believe that American
securities were the safest, the surest, and
the best paying in the world?
Again, the action of bankers is aiding
the cause of unsound money. While the
arteries of trade are drying up for want of
sustenance there is, as a direct result, much
deprivation and consequent suffering
caused by the stopping of the wheels of in-
dustry, whereby thousands are thrown out
of work, and are unable to procure the
necessary sustenance for those who are
near and dear to them.
These very men
—and their name is legion—will, in a spirit
of desperation, cast their vote for any-
thing that promises a change. In the plat-
form of the Populo-Repudists there is
promised a radical change—a tearing down
of the old political fences—a rearing of
conditions chaotic. In a spirit born of des-
peration, the American workman will say,
unless there is relief, "Things can be no
worse, and in the general turning over of
things, I may come out better. It costs
me nothing, and I'll try it."
The very restlessness of the people—their
lack of employment—the lack of satisfaction
afforded by the present conditions, all will
assist towards creating a desire to vote
for anything that suggests a radical
change.
Now, are not the banks by their action
towards business institutions assisting the
very cause in the defeat of which they
more than any other class are interested ?
In this we do not mean to be understood as
meaning that banks should give credit in-
discriminately. But we do say that the
men, the companies with whom they have
done business in the past, and have proved
themselves worthy of credit and confidence—
for what, after all, is credit but confidence—
should not in these times be cut off
without the necessary discounts which they
ask.
These concerns have unlooked-for de-
mands made upon them, and they in turn
have a right to expect that they shall at
least receive the treatment accorded them
in times past.
In good times banks are only too anxious
to get good commercial paper. When
times are slow they throw out without
discrimination, thereby creating worse
conditions and longer periods of business
stagnancy.
Is there good and adequate reasons for
the banks adhering to this course to-
wards commercial interests?
Let us look at our own—the music trade.
At the beginning of the year we had the
Weber-Wheelock collapse. We have al-
ways claimed that this was a much misun-
derstood affair in banking circles, and it
had an effect upon piano paper which the
situation did not warrant.
Then, if we look over the list since,
aside from the Smith & Nixon failure, we
have nothing of consequence, although