advance. If Europe has to buy food of us to anything like the amounts expected, there is a prevalent belief among our bankers that in the Autumn the golden stream across the ocean will again turn strongly westward.

The American crop outlook, as it is now forecast in the month of May, is indeed something almost beyond belief. In the first place the acreage sown in cereals largely exceeds anything ever before known in this country, the seeding of Spring wheat in the North-west during the last of April and the first week of May having been something unprecedented, showing that an enormous crop will be grown of that prime favorite in all the markets of the world-the "number one hard." The improved modern machinery of the farm has made this task of seeding comparatively easy. The farmers use drills sixteen and one half feet wide, and every mile they drive over these almost limitless expanses of land means the seeding of two acres; the sun and rains do all the rest until harvest. One drill driven twenty miles a day plants forty acres, so that sixteen teams can in a day seed a square mile. This indicates the vast product that impends; while in the second place crop shortages are complained of everywhere abroad, and particularly in France. To cheapen the importation of wheat and flour, the French government has already made a radical reduction in its import duties. Food must be got for the millions, and America is almost the only great wheat granary of the world which at the present outlook seems to indicate a probability of having an ample surplus. Then our corn crop, ready packed on the farm in the convenient form of the hog, will go by the shipload to the continent of Europe when we can avail ourselves of the ameliorated conditions of import which are about readmitting pork products to France and Germany. To increase the American export trade thus largely, will mean much for every business interest in the country-the shipping, the railroads, and kindred trades -and it particularly insures the general prosperity of the farmers, who are to-day specially gratified by seeing wheat quoted at a higher figure than has been known for years.

But above everything else, the chief indicator of American prosperity seems to be the railroad situation. This is the leading business interest, employing an enormous capital and sustaining a vast army of the population, so that whatever stimulates traffic and enlarges the earning power of the railroads is always sure to exert a healthy influence throughout the United States. The outlook for a good railway year has been the main sustaining power this season at the Stock Exchange, and this has been almost sufficient heretofore to overcome most of the discouraging developments, whether the outflow of gold or whatever else may have temporarily overcast the financial horizon. The recent meeting of the Western Traffic Association in New York has indicated the existence of reasonably harmonious relations among the railways, and an intention to prevent rate-cutting, which, while it gratifies spleen, usually paralyzes profits; so that a better era may be com

ing. This is secured also by the solid fact, always heretofore potentially demonstrated in railroading, that when traffic is plenty enough to give all the railways ample occupation, there is no cutting of rates. The general financial outlook is consequently good, and there seems no reason to despair of the business interests of the Republic, for the current year at least, so long as the basis for trade seems so broad and we have the present large supply of the precious metals. The Director of the Mint says there are $690,000,000 in gold in the country, and it is known that besides the large amounts in circulation and in the vaults of the banks, the Treasury held on May first, nearly $281,000,000 in gold coin and bullion. Besides this actual gold, there was then also nearly $387,000,000 in silver coin and bullion in the Treasury vaults. With something like 668,000,000 of the precious metals thus held in the Federal Treasury as the basis of the business fabric, the United States would seem to be well equipped for the financial campaign during the remainder of the year of grace, 1891.

PHILADELPHIA.

JOEL COOK.

WESTERN LANDS AND MORTGAGES.

THE year 1887 was one of financial adventure in the West. Railways were multiplied; towns were built and "boomed." People pushed into the arid public lands, and insisted that they were arable. Whole counties were settled and organized. It was the fashion to pre-empt land and to own town sites and city lots. Corporations innumerable were created for the promotion of all sorts of enterprises. Many financial follies were committed.

Speaking generally of the West, it may be said that sufficient time has now elapsed since the speculative fever culminated to enable us to appreciate those follies, to apportion the responsibility for them, and in some degree to timate their results.

As to responsibilities, eastern investors should not let their losses, as they once did their profi, blind them to the facts. The western States are precisely what they were during the ten years prior to 1888, when western investments were almost invariably profitable, and often enormously so. The resources, the soil, the climate, are unchanged. The western people, too, are the same. Whatever losses eastern investors suffered are chargeable not to western territory or people, but chiefly to the speculative fever which culminated in 1887, and which was produced quite as much by the eupidity and folly of the eastern investor as by any other cause.

But the investor is not so much interested in the origin of the mistakes of 1887 as he is in the results and in the present outlook. These results and this outlook are by no means what his imagination, and the newspapers, and those eastern brokers who are quietly buying in western securities have painted them. Let the eastern investor beware of

panic; for, just as some losses were entailed by over-confidence in 1887, so additional losses are threatened now by too little confidence.

As to farm mortgages, there need be little apprehension as to loans not now in default. Mortgages made in 1887 and 1888 which have been taken care of during the past two or three hard years will be paid in full. The fact that interest on such mortgages has been kept up means either that the land is good, interest-earning land, even in bad times, or that the borrower is financially responsible and likely to remain so. Usually it means the former; frequently it means both.

As to defaulted loans, of course some of them were bad when made, and are much worse now. They were purchases, not loans. But there were also many good loans made, now in default, the security still good, but the borrower bankrupt. There will be considerable loss on farm loans made east of the Rocky Mountains and west of the hundredth meridian; and also on loans made on some classes of so-called city property. Generally speaking, however, it seems likely that east of the hundredth meridian a large percentage of the defaults will be made good during the next twelve months. Many have been made good since January first. Western farm lands east of the hundredth meridian are in demand both for purchase and for lease. Where in 1890 farms could not be sold at any price, in 1891 they are actually sold at from ten to twenty per cent. advance upon the former prices asked. In the Spring of 1891 tenants were begging for farms that begged for tenants in 1890. This means that there has been a considerable returning from the arid parts of Kansas, Nebraska, and Colorado, from the Pacific coast and from the East, to the arable lands of Kansas, Nebraska, Missouri, and Iowa. There has also been something of an exodus from the towns and villages to the farms. Farmers are, generally speaking, prosperous throughout all the arable region. Their products are bringing high prices. There is no great surplus to depress prices during the coming Summer and Autumn. Crop prospects are excellent. Farmers have stopped borrowing money, and have set to work in earnest to pay their debts. The supply of farm-mortgage money more than equals the demand. Official records show that the mortgage indebtedness is diminishing. Thus a carefully-prepared report of he register of deeds of one average Kansas county shows that the real and chattel-mortgage indebtedness of the county was reduced in 1890 by half a million dollars, and in the first three months of 1891 by almost a quarter of a million It is estimated that in the State of Kansas the total recorded indebtedness was reduced at least ten millions in 1890.

more.

The census will show a large grand total of western mortgages-a fact which investors may easily misunderstand. More than half of this indebtedness will be shown to be for purchase money. A great proportion of purchase-money indebtedness is, of course, held in the West. Men owe for lands purchased, and hold claims against lands sold. Such indebtedness may be very large indeed, and still mean the reverse of bankruptcy.

Investors need not be alarmed by the recent political revolution. Unquestionably, in the campaign, the Alliance leaders talked something very like repudiation. But on such topics they did not carry the rank and file with them. The leader himself, in office, is different from the leader on the stump. The Alliance success was chiefly the result of low prices and bad crops. The farmer was discontented, and he determined to try what virtue there might be in politics. He had no revolution in mind; no definite economic plan to carry out. Change of opinion, enlightenment, and conviction regarding economic questions did not create the Alliance; discontent created it. If the movement hereafter leads to enlightenment and conviction, it will be well for the country. If it does not, the Alliance will be short-lived. In any case, nothing revolutionary need be apprehended.

Investors will do well to allow the companies that made their loans to manage them, except where they have real reason to suspect dishonesty or incapacity. Losses in western mortgages, lands, and mortgage-company stocks will not be great, considering the grand total of such investments made; and these losses will be insignificant compared with the losses in other kinds of investments concerning which there is no outery. They will be insignificant, for example, compared with the losses in the New York stock market for 1890.

The East has invested largely in the stock of western mortgage companies. Some of these companies are irretrievably ruined; many have suspended payment, and probably more will do so. Few, if any, of the older companies have failed. The mushroom companies went down or will go down. Some of these companies were wrecked because their loans were made with a view, not to the amount of the security, but to the amount of commission offered. Such companies were ready to advance money upon mere acres, regardless of whether those acres were good ground or stony ground, swamp land or sand hill. Other companies have come to grief because they were used mainly for building uncalled-for houses in premature and unpeopled town sites and additions to town sites. The quicker such companies are out of the field, the better it will be for investors. It is to be observed that the failures, after all, have not been very numerous in proportion to the number of companies in existence. It is probable that the day of the large mortgage companies, with their branch offices, agencies, and subagencies, has passed. The borrower and lender will hereafter get closer together. There will be fewer middle-men to shirk responsibility.

Western mines are now, generally speaking, beyond the gambling point. Miners are working low-grade ores necessarily in a conservative manner. Owing to abundance of capital and improved machinery the output is very great. A great part of mining stock scattered over the East is, of course, worthless. It was the product of the mining excitement of ten years ago. The irrigated lands of Colorado are rising in value, as are also the securities of well-managed irrigation companies. Western municipal securities are being promptly met. This is gen

erally true, even of western Kansas and Nebraska, where financial reverses have been most severe.

Nothing can be said which is generally applicable to miscellaneous enterprises and securities, except that they have suffered from general financial depression, and will improve with the general improvement.

Companies operating under municipal franchises, such as gas, electric-light, water, and street-railway companies, depend for their prosperity upon the condition of the cities where they are located. Such companies have been "promoted" somewhat beyond the real demand.

The bank record of the West during the past three years is remarkable, considering all the conditions. It has been clearly demonstrated that western banking capital is under the control of sound and conservative financiers. During the past winter the bank reserves have been enormous. No speculative loans have been made, and few of any kind. The demand for loans has been unusually light. The banks, of course, have made no money. Fears of panic have now passed, and reserves are diminishing. Attention is directed to the reports of Kansas national banks called for on the 4th of May.

TOPEKA, KANSAS.

J. WILLIS GLEED.

SOUTHERN FINANCIAL INTERESTS.

FINANCIALLY, the Southern States are glowing with health and promise, and rejoicing in the consciousness of their essential greatness. No furor has been created by sensational advertising, but the world has been astonished by the latest statistics of wonderful growth as shown in the national census of 1890. The sum of all is in the fact that the assessed value of property in nine States is estimated by the census officials to have grown from $3,000,000,000 in 1880 to $6,000,000,000 in 1890.

The reports of the census everywhere tell of enlarged and enlarging areas of cultivation, of new mines of coal and iron, excellent in quality and inexhaustible in quantity, of new manufactories in every department of human industry. All the bases of wealth and of sound and. satisfactory finance are here; and in my opinion Southern enterprises are animated, sustained, and fortified by as sincere and high a regard for commercial credit and personal honor, and by as profound a conviction of the necessity of fair dealing, as are to be found anywhere.

The cotton crop, which has steadily advanced since the war, has increased from 5,000,000 bales in 1879 to more than 8,000,000 bales in the past year, and every fiber of it finds a near and ready market at good prices. Our fruits and vegetables and general agricultural products go on improving in quantity and quality and are more and more in demand. The market goes on enlarging with improved transportation and familiar use in distant States. The trade in fruits and vegetables has grown into an immense business. Our coal and iron attract the