Vol. LI.

he panic on Wall street December 18, 1899, had eleits of comedy as well as of tragedy. Idiocy and bism walked hand in hand. Two million shares of k changed hands in five hours, and values on forty ks shrank $100,000,000. One bank-the Produce Exnge Trust Company-failed for $16,000,000, and one xer-Henry Allen & Co.-failed for $1,000,000. ut the same time Boston saw the failure of J. P. ire & Co., one of the "solid" manufacturing estabments; of the Broadway bank, that the Squires pracly owned, for $3,000,000; and of the Globe National k for $10,000,000.

study of the Boston situation and of the day in New k furnishes occasion for a presentation of monetary ditions and history, such as must interest every inctor of children and youth and be of value to many lers. The ways and means of banks and banking , and in times past, in this and in other countries, matters of current interest.

Wall street is a little rock-ribbed canyon, through ch the nation's wealth has coursed for a century. of this gorge has come the wealth that has builded rly every great railway in the country; here are deited the mortgage bonds of nearly every vast corporaof America; and here are paid nearly all dividends corporations and trusts. The only rival of Wall street he world is Lombard street in London. The custom se, the assay office, the sub-treasury of the United tes, and many of the largest banks are on Wall street. e, also, is the world-renowned stock exchange. -treasury occupies the ground of the old Federal hall, re George Washington took the oath of office as first sident of the United States, April 30, 1789; where, ), the first congress met.

The

riginally the outer wall of the city was here, and ere the street now runs was a stockade, along which tries passed by day and by night to guard the little age from savages and from wild beasts. I recently ad this sentence written innocently enough by a hisan of early times: "Wolves and panthers prowled ng the rugged ledges and dense thickets beyond, ence an occasional bear sallied forth to dine at ease the Netherland sheep." Twelve generations would nect the native bears who terrorized Wall street as y fed on the Netherland sheep, with J. R. Keene, the ler of the sportive bears, who terrorized modern 11 street as he fed at ease upon the modern lambs on ember 18, 1899.

EARLY AMERICAN BANKS.

'he first bank in America was the Pennsylvania bank Carpenter's hall, Philadelphia, established in 1780 by bert Norris and others in order to assist the governnt. They took as their only security bills drawn in speration by the Continental congress on John Jay, o was then in Spain negotiating a loan. This triotic act saved the government in its hour of need d enabled it to transport and maintain the army. The ne year this bank went out of existence, and in Januy, 1781, the bank of North America was chartered der the guidance of Robert Morris, with a president, elve directors, and a capital of $400,000. In 1784 the pital was increased to $900,000. This was the first artered bank.

New York was not wholly satisfied to see Philadella shooting so far ahead, and on June 9, 1784, she ened the bank of New York, with a capital of $500,000, id sent the cashier, William Seton, to Philadelphia to arn how a bank should be conducted. Only 115 years o New York went to Philadelphia to study the a-b-c banking.

How the world has moved! In 1898-the figures for 99 are not available as I write the New York clear

ing house did a business of $42,191,000,000, or an average daily business of $140,000,000. In contrast with a total bank capitalization in the United States of $1,400,000 in 1784, one city alone now has a daily clearance of 100 times that total capitalization of 115 years ago.

In these present days one person in every seven in the entire country uses some bank, and is more or less familiar with its processes; 115 years ago no man in New York knew well how the thing was done. Philadelphia was the source of knowledge and experience. The clearances in New York now are more than ten times those of Philadelphia.

CONSOLS BELOW PAR.

On the day of panic, December 18, British "consols" sold at 99.2 and United States government bonds at 109. Never before have American government securities been higher than British consols. In November last a New York paper said editorially that before the Transvaal war was over United States bonds would bring a higher price than British consols, whereupon a leading London paper remarked that such a prophecy was little short of an insult to the British government. Rarely is a prophecy so promptly fulfilled.

These "consols" have been the gilt-edge securities of the world for many years. Their official name is "consolidated annuities," a term applied by the act of Parliament of 1751, which "consolidated" all the funded debts, mostly annuities, of Great Britain. These were soon styled for short, "consols," and the name has clung to them ever since.

The consols sell for less than par now, because it is rumored that new bonds are to be issued. These consols bear interest at 2 3-4 per cent, but no time is specified for their payment. Our two per cent. bonds bring a higher price now.

DEBT OF GREAT BRITAIN.

It is interesting, as well as important, to see how the British debt has grown. When William of Orange came to the throne in 1688 he laid the foundation of the National debt. Prior to that time all moneys had been raised by borrowing of the goldsmiths and pledging taxes already voted, or giving more substantial securites. William started the debt at $3,320,000. Queen Anne in 1714 left a debt of $190,000,000. When the Revolutionary war broke out in 1775 it had reached $650,000,000, and at the close of the war in 1783 it was $1,265,000,000. In 1815 it was $4,500,000,000.

Queen Victoria, 1837, found a debt of $3,807,112,850, and in 1883 it was $3,565,000,000. In forty-five years of her reign it was reduced $242,000,000, or only $6,000,000 a year. From 1883 to 1898 it was reduced in fifteen years, at the rate of $42,000,000 a year, or seven times as fast as in the previous forty-five years. So confident was the government that it had announced that after 1903 it should pay but two and one-half per cent. interest.

The Transvaal war threatens new bonds, and money is worth so much in business that the selling price of these bonds is below par for the first time.

BANKS.

The popular idea of a bank is a place for the safe keeping of money, but that was not a prominent factor in the origin of banks, nor is it now. I remember having heard it said years ago that the word "bank" was derived from the river bank, that which kept the money securely. It really comes from a word meaning bench; something above the current or crowd, on which money is placed for convenience Undoubtedly the primal idea of a bank is convenience. Banks are not primarily for investment any more than for safety. Investment and the loaning of money on interest dates from earliest times. We find usury denounced in Exodus xxii: 25.

Number 4.

Banks are scarcely 300 years old; in America only 115, in England, 195, and in Amsterdam, 290 years old.

Banks are for convenience in using credit. A man has no use for a bank whose credit extends no further than his own. He is willing to pay for the privilege of using the extended acquaintance and credit of the bank. BANK OF AMSTERDAM.

The bank of Amsterdam, the forerunner of modern banks, was established in 1609. The idea then was to prevent loss by the wear on coin. Gold and silver in use lost somewhat of their real or intrinsic value. Some coins were discounted about ten per cent. because of wear. The bank was formed to receive coin, give bills to its value, and leave it where there was no wear. Persons were willing to pay a little something for this convenience. The expectation was that the coin was never touched. This good faith was maintained for about 150 years. Each year the officers took oath to that effect. About 1750 the bank began quietly to use some of the coin, and in 1790 the bank announced that it had put into use ten per cent. of the coin. In 1794, in a crisis, the bank was forced to admit that it had loaned several million dollars. The fall of the institution after nearly 200 years resulted from this betrayal of public confidence.

BANK OF ENGLAND.

The founding of the bank of England marks an epoch in English history. It came with William of Orange. He was at war with France and in desperate need of funds, but he dared not ask parliament to vote the money. This was also a time of commercial expansion, when merchants were wide awake. They wanted a new scheme of credit and more money. The merchants were ready to tax commerce, and the land owners were willing this should be done. William saw his opportunity. A tonnage act was passed establishing a bank to be styled a tonnage bank. The bankers were to advance William the money for war, and get their pay when the tax on tonnage was collected. The charter allowed them to carry on business in bullion and bills and to "transact other banking business." In this way William got the funds for war, the merchants got money and extended commerce, bankers got their privilege, and few law makers realized what it all meant. The bank of England was established, and the country has profited by it for more than two centuries.

In 1694 the bank of England started with a capital of $7,000,000. The bank of Amsterdam at that time had a capital of $180,000,000. In 1815, after the battle of Waterloo, the English bank capital had increased to $72,765,000. Now it has $140,000,000 of notes of circulation, and it carries $53,000,000 of the government indebtedness. The bank at its establishment acquired a significance which the bank of Amsterdam up to that time had not had. It was not only a convenience for traders but it was a means of floating debts, notably a public debt.

NATIONAL BANKS OF THE UNITED STATES. The first American bank was established in 1780, the first bank on a systematic plan in 1791, coming with the establishment of the government. State banks flourished until in 1861 there were 1,600 banks in thirty-four different states, with a capital of upwards of $250,000,000, of which four-fifths was in northern states. There was no National bank.

In 1861 the ordinary expenses of the United States government were $62,000,000, with an ordinary income of $41,000,000; the income was but two-thirds the ordinary expenses. In April, 1861, Civil war was upon us with a treasury short one-third, when there were no extra expenses. Congress met July 4. President Lincoln had called for 400,000 men for the army and navy and the secretary of the Treasury estimated the extra expense at $318,000,000. The income was about $170,000 a day, and the expenses would be $1,000,000 a day, or eight times the income.

Mr. Lincoln was without adequate experience and so were all of his cabinet. They provided for a $20,000,000 tax to be divided between the states; three per cent. tax on all incomes above $800 a year; a loan of $240,000,000 and $50,000,000 in national bills to be paid in Boston, New York, or Philadelphia.

Congress adjourned August 6, and on August 19 the banks of Boston, New York, and Philadelphia took $50,000,000 7-30 bonds at par. October 1 they took $50,000,000 more at par, and November 16, $50,000,000 for twenty years at six per cent.

Congress reassembled in December. There was talk of war with England, the money market was demoralized, and on December 28 specie payment was suspended. Early in 1862 congress voted $300,000,000 of government bills, "greenbacks," besides fractional currency, all legal tender for private debts. It also provided for a loan of $500,000,000 5-20's at six per cent.; i. e., they might be redeemed in five years and must be in twenty. The interest was all payable in coin, and this was secured by making duties collectable in coin.

By December, 1862, the expenses were $2,000,000 a day, ten times as much as two years previous, and there was a deficit of $277,000,000. In January, 1863, congress voted $100,000,000 more greenbacks. The bill passed the house on the 12th; the senate on the 13th; and was signed by the president on the 14th. But Mr. Lincoln in signing gave a warning that alarm would result if this was allowed to go on while the state banks continued to inflate their currency.

From January 25 to February 25 a national bank bill was put through the senate by a majority of only two and the house with a majority of only fourteen. This alarmed the world. Gold went bounding up, but the government floated its bonds and the war went on. State banks were taxed and either closed or applied for national bank charters. It was a marvellous experiment, and was bitterly opposed by many wise men, but it has given stability, order, and unity to our currency.

A government bill and a bank bill are radically different. The government bill comes down from the government; the bank bill comes up from the people. The government bill takes the place of coin for convenience; a bank bill takes the place of a man's note, and is a convenience, because it goes where his note is not known. For this convenience the man pays the bank. Our national banks, like the government bills, have absolute security behind the circulation, and at the same time they accommodate the people.

In cities and large towns banks serve another important purpose by letting checks take the place of bills. In large cities ninety-eight per cent. of the money used is in the form of checks. This system is now so complete that in the office, the store, the factory, the warehouse, the freighters, the home, the bank, and with every other person and institution to which money is sent checks take the place of bills. The newsboy, the boot-black, and the street car conductor are about the only persons who are certain not to have a check passed out.

America had been the home of Englishmen for nearly 200 years before the possibility of substituting checks was suspected; only within the past forty years has their use become general, and only within twenty-five years practically universal in large cities.

BANK DISCOUNTS.

The universal use of checks has led to a very general system of discounting notes, so that a man draws his check not against bills or coin deposited, but against his notes which have been discounted. When a man sends his note for $1,000 to the bank for three or four months he does not ask for the money on it, but merely that it be placed to his credit. He rarely draws against more than half the amount. As a rule, a bank finds that the notes discounted are called for only to the extent of fifty or sixty per cent. of the amount discounted, except in cases where there is collateral or where very large deposits are kept and they are consequently entitled to special accommodation.

COLLATERAL.

Many banks make a specialty of discounting notes and taking stocks as collateral. When the collateral is government bonds there is of course no risk; when it is any other gilt-edge stock there is practically no risk, but as the standing of stock shades off the conditions change. A larger margin is required. As the price of the stock in the market is quoted lower and lower, more collateral is called for, and through this great inconvenience arises.

Discounting the notes of merchants and manufacturers and accepting collateral as security for discounted notes has come to be so prominent a feature of banking that the circulation of the bank is of little account.

SECURITY FOR FUNDS.

One hundred and twenty years ago there was not a bank in America. Fifty years ago banking was an unimportant feature in American life, but within the last

forty years it has come to be a mighty problem, and one man in every seven is now more or less closely related to some bank.

Security for funds is now an important factor in banking business. The danger at first was from bank breakers, then from bank thieves, from defalcation, and from forgery. One by one these dangers have been provided against. Almost never is a bank vault blown open. Metals, locks, and other safeguards make money in a vault almost absolutely safe from burglars' tools and dynamite. The day thief, however murderous his purpose, rarely escapes with any of a bank's money. The officials are so safeguarded that this long-time danger is no more a source of anxiety.

Now the nets of examinations that examine are woven so fine that depositors have a moral certainty of receiving in full whatever money they place in the bank, so far as any official stealing is concerned. Stockholders and directors may occasionally lose, but depositors will lose no more. All recent bank failures resulting from official trickery have been brought about by timely discoveries on the part of bank examiners, who now examine to the surprise and confusion of dishonest officials.

One. who has not studied the great strides in making' money in banks safe can have little idea what has been going on in financial circles in the past quarter of a century.

SPECULATION.

The Anglo-Saxon race will speculate. Tacitus tells us that two thousand years ago the Anglo-Saxons, whom Julius Caesar undertook to look after, "are extraordinary.

They play at dice as a serious business, and that, with such a desperate venture to gain or lose, that when everything else is gone, they stake their liberties

SUPERINTENDENT M. E. DOLPHIN, Leavenworth, Kan.

and their persons on a last throw. . . . Such is their obstinacy in the bad practice that they even call it honor." The British and the Americans with the same blood in their veins have the same desperation and obstinacy. These nowhere show themselves more conspicuously than in the industrial ventures and in the stock market.

INDUSTRIALS.

Forty years ago men did business individually; now almost no man is in any business by himself. Thirty years ago firms consisting of two or three partners did most business; now there are practically no firms. Twenty years ago firms began to incorporate. The same partners did business, but as a corporation. Weld, Wilde & Co., became the Weld-Wilde company. This made it easy to determine just how much interest each had, and enabled the business to go on as before if one of the partners died.

Now most of the large corporations have been combined into a trust; e. g., the various tobacco corporations have formed one large corporation. This was done theoretically to reduce competition and to save expense, but in reality it was done to create a marketable stock, to create collaterals upon which money for other investments or speculative purposes could be raised.

Mr. Catlin used to manufacture high grade tobacco. At length he took in Colonel Hill and others and the business was carried on by Catlin & Co. Finally they made it the Catlin Tobacco company. Then they joined with many other concerns and became a great American tobacco trust, which put millions of stock upon the market. Now, Mr. Catlin, whose money was locked up in his business for thirty years, has all this wealth available for all kinds of speculation, while the business goes on just the same.

These "industrials" have sprung up in great number and have added untold millions to the stock market "Industrials" are practically a new feature of th stock market. They have come with "trusts." The f trust I think was Federal steel, organized about Octobe 1898, with an authorized capital of $200,000,000. As matter of fact only $100,000,000 was ever issued. 1899 trusts were organized with authorized capital, cluding bonds and preferred stocks of $2,020,895,M This was a frightful amount of marketable stock to created in a single year. A vast amount of it went up the market.

These industrials have taken front rank, which is the surprising feature of the market. January, 1899, th seventeen active representative railroad stocks were above the average of nine similar trust stocks. The stood in favor of the railroads 92 to 79; on February it fell to 89 and 76; on March 18, for the first time, tr stocks, or industrials, cross the railroads, 88 to 87; April 18, the industrials reached 94. On September 9th industrials were 102 and the railroads 92. Of course f December slump has carried the industrials below th railroads.

RAILROAD AND MINING STOCKS.

Railroads have long had their stocks on the marke but until quite recently the line was sharply drawn tween speculative and investment roads. There properties, like the Pennsylvania, whose stocks were most never in the market, because they earned so t that the holders kept them as they do government bond Consequently, there was no perceptible change in val There were many others that were especially speculati The price could be easily carried up or down by man lating the market, and bulls and bears could make c fortable sum in turn by promoting railroad stocks by "pounding" them, and the intrinsic value of the st never entered the thought of the speculators.

Of late the weak roads have been largely "taken camp" by some larger enterprise, and the prosperity the country has made all railroad properties of intra value, because their earning capacity is established But this has resulted in bringing nearly all railr "properties into the market

Mines have always been on the market, and in da in mining stocks vast fortunes have from time to tim been made. The latest instance is in the case of coppe The price of copper is very high, and is likely to main so for some time to come. The demand is gr and the supply controlled by a few large mines, whi have been combined into one immense interest, a tru These mines have a definite and large earning capacity and the "trust" has behind it more or less intrinst value.

Immediately copper became a word to conjure with A multitude of new mines of prospective values listed. Expert promotors told fabulous stories of sure success of these mines when they were in working order. The credulity of the lambs was appealed to, and the boom in outside copper knew no bounds.

Other great and legitimate stocks like gas, street n ways, and electric plants came in for the general bo effect. At such a time money is taken out of inv ment stocks and put into speculative. This gives market a great boom and vast fortunes are built up on paper.

THE MONEY MARKET.

ount. If he lacks large capital and unincumbered ources but has great personal energy and genius for iness they still believe in him. In short, banks are ined to believe in a business man, so long as his genI statement is satisfactory as to capital, assets, or iness capacity. On the bank's belief in him rests a 1's credit.

CREDIT SHAKEN.

man's credit is shaken when a bank finds him reing to any crooked ways. These doubtful practices in accommodation paper; i. e., the use of notes exnged with other business men so that a note for 95 presented for discount really means a liability for 590; in having two or more bank accounts to play one against another; in having the same men beI two or more concerns discounting each other's er in different banks, and especially in different es, with the appearance of divided financial responlity, which is in reality one and the same. The first hese can be explained; so can the second, and even third, but a firm or corporation is sure to be watched 300n as any questionable practices are indulged in. en the banking eye is once upon a corporation insitively, if the managers in a crisis overdraw their ount or misuse a bank their credit dissipates initly, and though their assets appear twice as great heir liability they are not trusted, and failure is inable.

MUTUAL DEPENDENCE OF BANKS.

o bank stands alone. All Eastern and Northern w England banks have close connection with Boston ks, by keeping a deposit in some bank in that city n which they make drafts. Every important Boston k has vital relation with some New York bank in the he way, so that every bank in New England, directly indirectly, has connection with New York. Thus ry bank in the United States and Canada has some w York bank as the fountain for its investment rerces. Thus the New York banks, as a whole, are security of the credit of North America.

Cach section of the country has seasons each year en it has large deposits in New York seeking profite investment. There are other times when each secn calls for large amounts of money. When the ton planters of the South are harvesting, housing, moving cotton, or the farmers of the great West are ndling their grain, they go to their local bank with a r months' note to be discounted. Then the banks of = South or the West, as the case may be, send to New eans or Chicago, and that city in turn to New York, the money with which to meet this demand, and rmous sums of money leave New York. In due time se notes are paid and the money comes back to New rk like an avalanche.

s the banking interests of America centres in New -k; those of Europe centre in London. These are the O great clearing house centres of the world.

DIVIDENDS.

January, and to some extent in July, corporations, roads, trusts, etc., pay dividends. Many millions are d out in this way at one time This is drawn directly indirectly from New York banks. Either the cor-ations have been accumulating large reserves in the nks for such an hour, or they borrow from the banks - the occasion in anticipation of prospective incomes. either case the draft upon New York banks is severe. hen all goes well, New York can play off one section North America against another, so as not to affect -iously the general market of the country. But there e times when the unexpected happens. These comnations lead to the massing of vast sums of money in ew York for a large part of the year with no adequate tural and profitable use so that the banks are active in eking unusual investments.

THE CLEARING HOUSE.

The fabulous use of checks in recent years, the comcated credits, and the sudden and enormous drafts son certain lines of banks have necessitated a new and portant combination. One line of banks does business -ry largely with boot and shoe men, another line with y goods houses, and another with marketmen and -oduce men. One set of banks deal chiefly with the outhern banks, another with Western, or New England, · Canadian. One class deals with merchants, another ith manufactures, and another loans chiefly on colerals.

In order that the banks of a city may help each other an emergency, they organize a clearing house priri ly to handle their checks more expeditiously and onomically. Each morning every bank sends an exert clerk to this clearing house with all the checks reeived the day before, and these checks are distributed mong the various banks on which they are drawn, or the bank in that city which represents the out-of

town bank. Each bank is credited with the checks it has on other banks and is charged with all of its own checks that come in. It is then charged or credited with the balance of the day's transaction. The clerk then goes back to his own bank with the details of the day's doings. The bank officials compare this statement with their own records, and if it agrees the balance is paid; if it does not agree, the matter is carefully gone over with the representative of the clearing house.

The clearing house has a committee with full powers to act in every emergency. If an unreasonable run is made upon any bank this committee may easily protect it by furnishing all needed credit through the clearing house without the rest of the world's knowing about it. On the other hand, when the clearing house withdraws its confidence a bank closes its doors at once. In early December a Boston bank, with $600,000 in cash in its vaults, with no run whatever upon it, closed its doors because the clearing house was not satisfied with its condition. At the same time another bank in Boston was carried by the clearing house for about two weeks, in order that it might be brought into the best possible condition for its creditors.

Thus the clearing house has come to be a vital factor in all financial life. In the mid-summer panic of 1893 disaster was avoided by the issuance of clearing house certificates, which were accepted in lieu of cash by all banks. A bank was allowed to deposit securities with the clearing house committee, and receive seventy-five per cent. of their value in certificates, which took the place of money.

THE PANIC OF 1857:

The great panic of 1857 affected Europe as well as America, London more than New York. The whole civi

SUPERINTENDENT W. H. GLASCOCK, BLOOMINGTON, IND., President Indiana State Association.

lized world seemed ready to go down with one great business crash, when the bank of London saved the world by the issuance of $10,000,000 of new notes in a single day. The bank had less than half a million cash on hand, and its liabilities were $65,000,000, but its heroic action and sublime faith quieted the nerves of business men, steadied the credit, diverted attention, and averted disaster.

WALL STREET. DECEMBER 18, 1899. Notwithstanding the unparalleled prosperity of the country New York was on the verge of disaster and in the swirl of a frightful panic on the 18th of December, 1899. The Boer war disturbed British finances. Consols dropped below par for the first time. American industrials, railway and mining stocks owned in Great Britain were sold to an unusual extent, because of the war At the same time corporations and trusts were husbanding their money for the payment of dividends. Vast sums had been sent south and west because of the formation of large trusts. Boston was calling for many millions a day because of the slump in copper stocks, and because of the failure of one of her largest industrial plants for $5,000,000, the failure of one bank, and the assurance that another large bank and two large houses were to fail.

At this juncture the New York banks had to call in loans from various investors and speculators. The money market tightened. To raise money to pay the banks both speculators and investors sold stocks, good and doubtful, when the demand was light. This lowered the price of stocks. Immediately banks that had loaned money on collaterals asked that more stock be put up to make good the decline. In the tight market men had not the money with which to get the margin. They offered twenty per cent. for temporary loans to save

their stock, then fifty per cent., and so up, up, up, until 186 per cent. was offered, and the market had already shrunk a hundred million dollars in value in four hours. In another hour all would be chaos, everybody trampling over everybody else in the general frenzy.

MORGAN AND OLCOTT.

In the case of a fire in a public hall a great loss of life often results, indeed, always, unless some commanding presence steadies the maddened crowd by peremptory orders. The heroic deeds of men in such tragic moments are on record, but nothing has ever exceeded the heroism of J. P. Morgan and Frederick Olcott, New York bankers, that fateful afternoon, when with blanched faces men heard of the crash of the Produce Exchange Trust company and of Henry Allen & Co. Men appealed with despair for loans at 186 per cent.,this means $50 a day for $10,000, $5,000 a day for a million, as against $1.60 on $10,000, or $160 on a million. It was in that moment which bordered on frenzy that J. P. Morgan instructed his representative on the floor to call out:

"A million dollars to loan at six per cent." Frederick Olcott's representative followed:"Another million at six per cent."

Another million was offered at the same price, and then the clearing house was prepared with $10,000,000 at reasonable rates, and of this $4,500,000 was taken at an average of fifty per cent. The flurry was over. This $7,500,000 satisfied the demands of the hour.

SECRETARY OF THE TREASURY'S AID.

In 1893 President Cleveland's secretary of the treasury sold new government bonds to the amount of some hundreds of thousands of dollars for the relief of the financial situation. This was also necessitated by the fact that the income of the government was not equal to its expenses. It relieved the financial strain to a great extent.

At various times during the past few months the secretary of the treasury has either purchased government bonds at the market value, or has paid in advance interest due on bonds. In the recent crisis the secretary arranged to loan money upon bonds to their full value through the banks, and he also provided that internal revenue taxes may be received by specified banks and held for a little time, which means that the money is kept in circulation.

CHRISTMAS TRADE.

The Christmas shopping has on two different years in this decade come to the relief of the banks in a substantial manner; indeed no stringency in the money market has ever held through the holiday season. The people always have in the total, millions of dollars in the homes awaiting special occasions or emergences for expenditure. The Christmas time brings forth this money as it does other reserves. Nothing so substantially relieves the money market as that which comes through all kinds of retail trade, and most lines of business feel the thrill of the Christmas shopping.

TERMS OF THE MARKET. Bulls-men who toss up prices; suggested by the fury of the bull. They always seek to keep up and lift up prices of stocks.

Bears-men who pull down prices; suggested by the clawing down from a height in rage. They fight all the time to lower the price of stocks.

Intrinsic value-the genuine earning value of a stock. Investment stocks-those which one buys for their earning capacity.

Speculative stocks-those which are bought with the purpose of selling in a short time, as soon as the price advances.

Buying on margin-not paying for the stock, but depositing a sum sufficient to secure the broker against loss in case of shrinkage. At the completion of the transaction he receives his profit or pays the loss. The man can speculate on a large number of shares with a very little money if the margin is narrow enough. It is at this game that bulls and bears play most skillfully.

Pounding the term used in connection with the effort of bears to shake the faith of speculators or investors in a given stock.

Taken into camp taken under the protection of some larger interest.

Listed-admitted to the brokers' sales and posted or advertised by them as stocks for which there is a demand.

Lambs- men who are not adepts at speculation and buy foolishly, sportively, with the certainty of losing in the end.

Liquidating settling up one's accounts in the stock market, paying what one owes on margins. etc. Industrials--various stocks of industrial plants and

interests.

Money-probably comes from a Latin word meaning flock; and "fee" from a Greek word meaning cattle. Originally wealth was reckoned by the number of cattle a man had in his flock.

The latest wonder of the world is liquid air. Is it not curious that a liquid should pour out of an apparatus which is known to be empty (using the word in its usual sense) just by the operation of plungers, as in a boy's pop gun?

Liquid air has the appearance of water, though when first drawn it is a little murky from minute snow-like flakes of carbonic acid, which always exists in a gaseous form in the atmosphere; but when settled or properly strained, it has a slightly bluish-gray tint. Poured upon water it quickly sinks to the bottom in large spherical drops.

Water, to become an invisible gas, like air, has to be heated to 212 degrees, Fahrenheit's scale; but liquid air becomes a gas (that is, air) at 312 degrees below zero; and at any temperature above that it constantly steams, unless wholly enclosed and under compression. Reversing the form of statement, air, when compressed, may part with its heat until reduced to a temperature of 312 degrees below zero, when it becomes liquid.

As long ago as 1890, a small quantity of liquid air was produced and its temperature noted. A few years later, Professor Dewar, in England, at different times, produced several pints of the liquid. The cost of the first pint is currently reported to have been about three thousand dollars. Up to the year 1899, the substance which, in its gaseous form (the atmosphere), we all get in abundance for nothing, was too costly a luxury even for the wealthiest. The small quantity that could be carried in a vial, of the capacity of a cubic inch, would have cost, perhaps, several dollars; and if the stopple were pulled out, the entire contents, subjected to the temperature of our bodies, would rise in a mist and disappear in a few minutes; but if the liquid were corked in tightly,

and subjected to this temperature, the bottle would burst in a few seconds. The gas (or air) from it would furnish a supply of breath for nearly half an hour to a man with his head in an air-tight bag; for

the proportion in bulk of natural air to liquid air is 800 parts of the former to every one of the latter.

The reduction of the natural atmosphere to a

liquid form is only effected by successive compres sions by great force or by refrigeration,-in practice it is done by the application of both, simultane

ously.

Charles E. Tripler of New York-the first person claim that with their apparatus they can produce sevto produce liquid air in America—and others, now eral gallons an hour, at a cost of much less than twenty cents for each measure. article would, in most instances, be almost as cheap At such a price the as ice, and far preferable for use in food refrigerators, because of its smaller bulk, dryness, and the consequent absence of mould.

The air liquefying apparatus used by Tripler in the earlier part of 1899 may be described in a general way as consisting of three steel cylinders, through which the air passed successively, being compressed by a middle of the cylinder, the air, very much reduced in plunger in each. As the plunger descended near the bulk, escaped through a valve into a coil of pipe that discharged into the next cylinder, the plunger in which was at the moment raised. Then the process was repeated on a fresh supply of air in the first cylinder: while the first charge passed on from the second cylinder to the third, where it was subjected to a still stronger pressure, estimated to be from 2,500 to 3,000 pounds. Of necessity the cylinders especially the last in the series-must be exceedingly strong. In fact, its wall of iron or soft steel plate

In the Chase apparatus (Boston) the cooling c air in the first stages of the process is effects!

the circulation of salt brine in pipes throug around the air vessels; this brine having first rendered much colder than ice by the vaporizati liquid ammonia. This is the means generally for producing a low temperature in cold-storage w uncovered portions of the pipes through which houses for the preservation of fresh meats. A compressed air passes have a thick coat of a floury frost.

Several hours of operation of the apparatus. usually necessary for the reduction of the nat temperature before a flow of liquid air is obta This is preceded by a flow of what looks like water-fog, but is really air reduced to the densit vapor, not yet quite low enough in temperatur liquidity.

Among the annoyances of the process in the valves by frost from the water vapor always pr perimental apparatus has been the clogging of in the atmosphere. Another, for which ther remedy, except covering and caution, is the f bites, which will occur from a drop of the liqu.' the flesh or direct contact with a vessel containing If the finger should be thrust its full length int liquid, it would in a few seconds be frozen to bone. Yet in this same liquid air wire m burned, as in oxygen gas, by touch of a s match.

When we consider that water changes into s at 212 degrees above zero (Fahr.) and that liqur boils when warmer than 312 degrees below (making a difference of 524 degrees between the ous points of the two substances), we may app the several unusual and curious conditions per ing to the latter.. It does a strange thing wher open vessel containing it is set on a block of inboiling until it is all gone, if allowed to re This is because ice is 280 degrees warmer thar boiling temperature of liquid air.

We have seen that liquid air returns to its nat gaseous condition so rapidly under ordinary temp tures that even at the price of six cents a gallon which some profess it can be furnished) its us refrigeration or power would be very costly wer not that waste can be much reduced by insulati a vessel with a slight vent only. With any i tion of opportunity of escape, however, there is a crease of danger. A closed reservoir, even fr

was about five inches in thickness, with bands and small quality, must be of great strength, and ma hoops of steel in addition.

From the third cylinder the air, compressed to the last extremity, rushes out of the valve into the cooling coil, and from this to the bottom of a smaller closed cylinder, which acts as a purifier. From this it passes out by a pipe at the top, which ascends vertically about fifteen feet, then turns and descends an equal distance, where it finds vent by a valve of very small aperture, and controlled by hand, first into a small chamber, then through another valve into a larger chamber, which encloses it. Here it expands, and passing upward and then downward through a and passing upward and then downward through a large pipe that encloses the smaller one just described, finds vent at the open end near the purifier. There is an intensely chilling effect from the expansion of the compressed air in this larger pipe, by which the temperature of the incoming compressed air in the small interior pipe is brought down to the critical temperature (182 degrees Fahr.) at which it is possible by pressure to reduce the air (which is like a thin vapor at this stage) to a liquid. Accordingly, after a little while, air in a liquid form begins to trickle down through the needle valve into the smaller chamber, then into the larger one surrounding the first. From the faucet at the bottom of this it may finally be drawn in a stream.

The receptacles designed for holding it have double walls, with a filling of felt, for heat insulation; and the stopple is usually cotton wool or felt; a material less penetrable by air vapor would soon be blown out, or the flask exploded,

quently very heavy, while always liable to destra explosion from any considerable and sudden r temperature. Thus it may be used as an exp in guns, and is actually used in Germany for blas in a coal mine. Yet a quart of liquid air mig carried in a common paper bag all day without lara ing the bag in anyway, because of the dryness of liquid; only before the day was over it would all h disappeared without being observed in its g Its freedom from the wetness pertaining to may be further illustrated by immersing a hand chief in it until fully saturated, which if taken and given a single shake will be found quite dry.

There remains to mention the use of liquid air!* power: The value of compressed air for this pose has been demonstrated in its practical use i several years, both in fixed locations and on stre cars in New York city; but as yet no engine has been placed on the market in which the vast expans force of the liquid air is utilized. When such an gine is obtainable, the day of aerial navigation have arrived.

There is another feature of this new "power" al should command for it special favor. This is absence of waste, in its use, of the vital element human life, which it furnishes. Atmospherie. forced into the form of liquid air, begins at re return to its original condition, which it spe reaches without appreciable loss: doing its benef work as it returns.

There are several other curious phenomena 25