## 5 December 1868.

### East India Irrigation and Canal Co.

Auf meeting der shareholders (London, 28 Nov. ’68) sale of the transfer of the Orissa undertaking to the Indian Gvt. beschlossen (cf. p. 52)

### Money Market. Fresh rise in the Bank Discount Rate von 21/2 to 3%. (Dec. 3. 1868)

Stets, after a lengthened period of monetary ease, the first movement upwards, particularly when limited to 1/2%, is insufficient.

1852–53 … 37 weeks of 2% followed by 21/2, which, as at this time, lasted only for a fortnight, when advance to 3%.

1862 … after 14 weeks of 2% the directors of the Bank moved to 3% at once

1859 1857: Reaction in the value after 10% carried the minimum down to 21/2%, for 5 months: then 31/2%, for 1 week; then 41/2%

1866, at beginning, after 27 weeks of 21/2%, rise to 3%, followed in 12 days by further movement to 3 4%.

After the reaction during the first 6 months of 1865, the advance from 3 to 31/2% was succeeded in a week by 4%.

The fact is, that no sooner is the monetary „screw“ turned, than merchants and others under engagements become still more anxious, as a matter of caution, to place themselves in funds. Hence the upward movement receives a further temporary impetus. Ferner: At this time of the year, the tendency of the rates of discount at the present period of the year is always almost towards firmness. Some of the banks help the market up by following the very absurd practice of restricting advances in order to show large reserves in their forthcoming reports. Customers also assist the movement by seeking discounts for the mere purpose of increasing their balances at the close of the year.

### Financial Affairs (U. States) (Circular of H. Clews et Co. New York)

Our produce exports continue to fall below those of last year, while our current imports exceed those of that period (1867). The importers have to a very unusual extent deferred their payments, so that remittances for the next few weeks must be heavy, and the more so as 12 Mill. $to 14 Mill.$ have to be remitted against the coupons of foreign bondholders. Our foreign merchants are extensively „short“ in gold, having sold in anticipation of a decline to follow the elections and the active forwarding of the cotton crop. Advices from Europe indicate the probability of higher rates of interest at the Banks of England and France; which would check the demand for our securities abroad, and tend to attract gold in that direction. It may be owing to that tendency that so few of our bonds are going out in return for the November coupons.