Richmond enquirer. [volume] (Richmond, Va.) 1815-1867, 1815-11-04

| II is' In iact, the principal morcv hQhe,
Oh StHSle country for it does not pass i,
another.-Ihere is always a certain rela.
ton between these notes and snecie, and
inland oils oferchange whenever the lat
ter are employed.
PROPOSITIONS.
LIST. he value ct money, as of every o.
uier commodity. depends upon the pro-
PARTON between the demand and the supply.
W mere more is poured into the market
thsn is wanting, it depreciates where
there IS less, it rises.
| "a. The demand for money increases.
whcn there are more commodities TO cir
| culate in proportion to the circulating me
cium IN one place, than there are commo-
IioieS IN proportion to the circulating me-
Gum OF the otherplaces with which it deals.
1t goods are lower in one country be-
| cause money is scarcer than in others, Their.
| IS at once demand for more money-lnore
| is wanting to supply the demand.
"a. Il more money be wanting, it will
tend 70 supply the demand for those who
nave it. will generally cary it where they
can sell 1t the best /; in other words, buy
more for it,
Specie 7rW SILL in all countries; it vii,
therefore go to eli where it is wanting.
SWs Of Exchange so from ono country
20 another, butt is topay the debts of the
one to the other, not to swell the circulating
medium of the country to which they are
sent. They are. in fact, circulatingme-
dunn betSueen TWO countries-in the one
whieh draws them, they may, for short
tiine, answer the purposes Of money but
they do not pass through mAny hands, and
are soon Withdrawn from the circulation
- HCnK-JFotes are confined to the country
"iiiCh issues them-5ut, they pass from
one section OF the same country to another.
according IS they are zUanlinr.
fth. bank-Notes VIII not depreciate. 81
long as they are convertible into specie
for, whenever the circulating medium ex
ceeds the demand, a part of it will flow o.
yer (see prop. S)--but it is the specie
winch oycrilows and to obtain it, the bank
paper WI flow back upon the banks. Ap-
pFIzed OF this tendency, they will therefore
strive to throw no more OF their paper ont
than Is wanting 70 supply the demand.
his convertibility is therefore the only
criterion by which you can regulate the is
sue of bank-paper The Banks would he
always tempted by the prospect ola profit
to overtrade, or throw more paper into the
market than is wanting but they are de-
tered by tue fear of a run.-Do away IN.
cohve'tioillty. and they are extremely apt
10 overstock the market. In this case, their
paper deprecatcs and the country is in
Jurea IN ITS dealings with all others.
oth; In all cases, paper is not o.
biiged to depreciate, because it NAV be
worth less than specie. For, the latter |
night rise in another country, and of course |
rise above paper in your own; some of it
may DE exported, and the quantity of pa |
per may thus be reduced below what is ne |
CcSSary as circulating medium. Instead |
OF depreciating, therefore, this paper might |
DC wortl more than it was though below
par when compared to specie
1t is when the great mass of the commo-
al'ies rises in tier price, when every ne
&c SS4ry is enhanced, that we may priuci-
gaiy peGh to suspect the depreciation of
monsIratc, tnat 7ve have for some time ar
rived at this point.
9th. Bank notes may depreciate, though
the banks are perfectly sound and solvent.
For every note which they issue, they
generally receive the note OF two good in
dvlduals. The banks cannot therefore
break, until the property of these dealers
IS swept away. Still, if the notes they issue,
exceed the demand, they must more or less
depreciate.
These propositions being set forth, let
us apply them to the Cases which may be
stated.
ORDINARY STATE.
In the ordinary run of the trade, the
metals viii flow into those countries where
they are most in demand. Legal, or other
impediments may, fora time, retard their
to an equilbrcen but this is
the state to which they are always natural
ly tending.
If they have attained tn: Equili-
brium in two countries, which deal with
each other, any A!tke balance, which may
occasionally fail due from one to the other,
will not necessarily be paid in coin. There
is no Involvement of Erotit, for the creditor
to ask it. But the debtor may either pledge
himself to remit it the next year in goods
or he may buy Bill Of Exchange a5ope
tar from some one who is entitled to a bal
ance, or Bill upon some other country,
where goods have been exported, and in
which his creditor is willing to take his debt
But if the balance be so great, that Meth.
er credit can be asked, nor Bills obtained,
then the precious metals must be exported,
and they will rise in value, so as to be above
tar in relation to Bank PaheY-They will
rise above par, because they may be used
and therefore will be in demand, for this
purpose; whereas paper will not be so.-
This premium will be greater or less, as
the amount Of specie TO be RENTED is grea-
ter or less. The Banks, will, in such ca
SEES, take care to watch over the Hesperian
fruit which they have t guard they will
throw every difficulty in the way of its e.
mission and eXportati N /; but, il is impos-
S BILE, unless they shut their vaults al;oge.