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Panics That Shook the Nation J. T. Boifeuillet in Atlanta Journal. Recently, several gentlemen were discussing the next presidential election and one of them, of well known republican predilections, remarked that financial conditions were always better under the rule of the grand old party than when the democrats were in power, and for this reason he expressed a wish for republican success at the polls in November, 1924. I differed with the speaker, and I took occasion to emphasize the historical fact that all great financial panics which have befallen the country since the close of the War Between the States happened under republican administrations. He smiled and replied that the reign of the democrats had covered a very brief period. I answered there had been sixteen years of it, a time sufficiently long for disaster and ruin had the republicans been managing matters. I pointed out to the gentleman that the great panics of 1869 and 1873 occurred while Grant was president, and the republicans had control of every department of the government. The tremendous crash in 1884 came when the republican president, Chester A. Arthur, was in the White House and the affairs of government had been under republican control ever since the disasters of 1869 and 1873. The panic of 1893 was the result of conditions that had existed for at least two years before, during the republican administration of President Harrison. They were largely attributable to extensive speculations. Cleveland steered the Republic safely through the storm. What is known in financial and political history as the "rich man's panic" occurred in 1907 while Theodore Roosevelt was at the helm in Washington. It was alleged at the time that the situation was only saved by the unlawful merging of steel corporations. The panic was caused by reckless speculation and improper management of financial institutions. The situation in the United States was alarming on the outbreak of the European war in 1914. The most serious catastrophe in the financial annals of the world was threatened. But Woodrow Wilson was reigning at the national capital, his democratic foresight and wisdom had prepared for any emergency, his management strengthened credit of every kind, and preserved the commercial and financial structures of the country from the conflagration which was raging in Europe. The manipulations of Jay Gould and Frank Fisk Jr., powerful Wall Street operators, brought on the calamity in 1869. This was the year of the historic "Black Friday," September 24. Gould and Fisk created a "corner" in the gold market by buying all the gold in the banks of New York City amounting to $15,000,000. While other financiers, bankers, merchants and kindred spirits were wrecked, this couple smiled over the ruin they had caused, having cleared $11,000,000. Their operations were said to have ramified throughout the republican departments at Washington, and, according to the rumor of the day, touched the White House itself. For several days during the Gould-Fish "corner" the value of gold rose steadily, rapidly ascending from 144 to 200, when the climax of the crisis was reached and the public mind was made to toss and chafe like a mountain torrent in the wild sweep of its waters. Banks toppled to ruin, commercial houses crumbled to dust, all trade was suspended, men went insane because of their losses, and the wildest excitement prevailed from ocean to ocean. Loans for building railroads was one of the chief causes of the terrible panic in 1873. A mania for railroad construction prevailed in the land. There had been constructed during the year 4190 miles of railway at a cost of $120,000,000. Railroads stopped paying coupons. Banks succumbed under the burden of their unsaleable railway assets. No securities could be realized upon. There was a run on bank deposits. The suspension of payments took place in New York banks. The disaster broke forth in all its fury on September 18. Jay Cooke was the first failure. Then came that of Fisk and Hatch, followed by the Union Trust company, the National Bank of the Commonwealth, Sprague, Claflin & Co., and so on down the long line of former vast and glittering concerns of wealth. The Stock exchange closed and finally disaster was upon the whole country. And sorrowful to relate, the republican party was in charge of the nation in this awful era just as it was when "Black Friday" was ushered in on the calendar of time. Some one has described the terrific panic in 1884 as "the last thunder clap of the commercial tempest which had reigned since the month of January, 1882." This calamity was called "a panic of securities." It burst with great violence upon the United States, shaking the Republic, despite the fact that the republicans were directing governmental affairs. Gigantic speculations in railroads followed the panic in 1873, and the zenith was reached in 1880. The New York and New Haven railroad was placed in the hands of a receiver on January 1, 1884, and other railroads shared a like fate very soon. The explosion occurred in the city of New York on May 6 when the National Marine bank caved in. President Fish of that institution was associated with the house of Grant & Ward, of which former President U. S. Grant was senior member, and the firm went to the wall with liabilities of $17,000,000, causing tremendous excitement, particularly because of Grant's partnership in the business. Additional alarm and distress came when the Second National bank, John C. Eno, president, collapsed with liabilities of $3,000,000. Then came the crash of the Metropolitan bank, other financial institutions quickly falling like so many ten pins knocked down. The National Union bank had one debtor of $2,400,000, six times the amount of the bank's capital. Ward of Grant & Ward; Fish of the Marine bank, and Eno of the Second National bank were charged with having misused the money of other people. Thirty-two million dollars represented the amount of the liabilities of the New York banks that suspended during the month of May, 1884. This was regarded as a tremendous sum of money in those days.
