will briefly consider its causes. It may be traced
remotely, in some degree, to the distrust of American railway
securities in Europe which attended the reckless administration of
the Erie Railway under Fisk and Gould, and which lingered after their
overthrow, indisposing capitalists, as well as small investors, to
have anything to do with American railways. It is true that a market
still remained there for these securities, but it was a much more
limited one than it probably would have been but for the Erie scandal,
and within the last year or two it was entirely glutted. Financial
agents found it impossible to float a new American railway loan even
where the security offered was a first mortgage bond. Thus, Jay Cooke
& Co. were greatly disappointed with respect to the sale of their
Northern Pacific bonds abroad, and nearly as much so in the demand for
them at home; but they were pledged to the undertaking, their
solvency became dependent on its success, and they were sanguine that
confidence in the great enterprise would grow with every mile of new
road constructed.

Mr. Jay Cooke undoubtedly looked forward to a subsidy from Congress
for carrying the mails over the new line, and in all likelihood would
have obtained it but for the Credit Mobilier _expose_, which caused
both Congress and the people to "shut down," not only on everything
having the appearance of a "job," but on much besides. The ill odor
into which that investigation brought the Union Pacific Railway and
all who had been connected with its construction was a heavy blow at
new enterprises of a similar character where government land-grants
were involved; and the vexatious suit which Congress authorized
against the Union Pacific Company and all concerned was another blow
at confidence in the same direction.

The formation and rapid spread of the Grangers' association in the
West, and its avowed design to make war upon the railway interest with
a view of securing cheap transportation to the seaboard, was another
disturbing element, undermining confidence in railway property.
But the greatest and the immediate cause of the crisis was the
over-building of railways; and hard indeed are likely to be the
fortunes of the unfinished enterprises of this character arrested by
its blighting influence; for capital for years to come will be very
slow in finding its way into the bonds of roads to be built by the
proceeds of their sale. It was a false and dangerous sy