Constitutional Whig. [volume] (Richmond, Va.) 1824-1832, 1827-12-26

That, 1t there should be fall in the price il wor,
at the utmost, be very small Bank Stock is a com
modify IN market and there principle of poli
cal economy well established as 10 be uniyer,a)lv
received as an axiom IN that sceoco, that the price
OF every commodity, mot excepting even gold aud
buiiion regulated in ell cases BY the prooortioo bo
tween the supply of, and the demand fer IT, There
may occur occasional fluctuations aud irregularities in
this general state OF things but these Ike The alter
naung vibrations OF the pendulum, still tend to qucsce
10 the centre. Now take this univ aud well Sc tiled
principle, and apply 1t to the existing situation Of his
country--o the stock queston--to its character To
the quantity proposed TO be Sold and to the demand for
| il.
| II will not be denied by me- said NJ. "a tb.t s,,
oil circumstances might be conceived .o exist IN W. b
an attempt 20 sell this Of United States, Raj,
Stock, would be productive OF rery consideyabn -,
preston OF IFS market price. But the question nov tn
be considered by The House not what might b,pnsn
under given posture of conceivable circumstance
but what likely TO happen in the actually exi,;in
state OF things The only ground of such SeDress;o
any must be the large increase of supply while tina
same demand, and no more, continues TO exist. Such
state of things would impinge upon the general
principle FIRST stated, by altering the proportion be
tween demand aud supply. But no such state of
things will exist, should the present proposition ,re
vail: for there is 6 has been for these three wears mast
diminished quantity of Government stock 10 be sold
ana an increased amount of means 10 buy il, both &c
casioned by one and the same Cause, uamey-the PAY
ing OH of large portions of the public debt by the re
demptioD of United States Stock.
Dur,ne the year 1925, We paid of the principal OF
an
IN 1926, more than screen nijl:ons and, tariug the
present year, 1927, shall have paid more aa six
ana hall millions inoroi making in III amount of
twenty one and about quarter millions. The Sec
retary oil the Treasury, however. informs Us in his
Report that five millions of this debt has been paid
by the issue of stock 1t will therefore be
pTopeY to deduct this and the res,il; will be- that in
these three wears, there have been actually maid off
more than sixteen millions OF the public dedt To
tins let nae add that, according 10 The e.ateens reIa
I'VE 70 the Smiling fund, and the present condition
OF the Funded Debt, there will be paid. in the year
1876, seven millions more; and in the wears o2S and
1880, all amount beYori this ibeine ENLARGED BIZ
the increased activity of the Sinking Fund, from the
circumstance OF large amount DOW devoted TO in
terest becoming applicable TO the principal the debit
Reckoning then that, during the years 1925, and r.
sixteen millions have been paid, ADD tirst in 1927 g.
and g. twenty one millions more will have been paid;
hore will have been Of THIRTY Seue nkons
OF public debt III the United States paid of 10 sir qys
| Have any vioiept shocks been produced by tins o
Peraon! Has ans arrangement resulted in the fin
ancaI arrange,ns MS OF the COUNTRY? EIas u States
stock fallan? apprehend And wbg? For the
reason have stated and which now apply TO the
proposition before u.s. and from which very extensive
consequences necessarily follow going 10 sloy that
the effect OF the payment Of very large Amounts The
pubic deot is not TO diminish, bu; TO increase the
price OF the residue. When in the 8 stish Govern
rnent their sinking fond established in the wear
1885. it was held neccssary TO tx maximum far il,
operation, lest too great an amount OF money should
thereoy be thrown INTO the market. II VII! be nv
endeavor to show that, with With them the effect
of paying off the debt produces an abundance of mo-
ney and taereio abundance OF tie means OF our
chasing the ban. stock which the same operation has
thrown into the market. While the former or.srs OF
the public stock have iher hands mony which seeks
investment, the sale of i!,a bank stock will furnish, an
admirable Hnoda by which this may be ACCOMPLISHED
App!y ing the principle with which, set ont MFR y
remarked, that il would be apparent that, If any de,
preston was to result it would rather be produced by
paying the dob: in money than BY exchanging il fer
! bank stock By Tedcefning The national stock, nonar
ttr -El E6C ofn1y fl
market and naturally seeks some employment Nov
propose, said Mr. B. while this done TO carry into
te market an equal amount of stock III which thai
money may be INVESTED again. DO gentlemen appre
heDd depression in the price of siocls yyby2 e-
cause say they, there will be TOO largo an amount Of
II Tor the money which is prepared TO be invested 10 IT,.
Bat my proposition, To its whole ex lent, goes 20 pay
of SO muc OF the public debt and thereby TO furnish
the means OF purChsspg-in addition TO which seven
millions viii! be derived next wear from the coer
alton OF the sinking fund The conclusion from a
Wow OF these facts would nc 10 be- that 1t is
neXt 10 impossible that depression be produced
in the price OF bank stock by an operation which WI
1T exposes that stock TO sale supplies at the same time
the means and The iDducenent for purchasing it.
] 40 not mean 10 advocate the old. and what
understand TO be now an exploded doctrine, that the
payment of The public debt addition 10 The actual
funds Of The nation. The effect Of that payment is on
y TO LEI loose much capital from permanent inv
Iuen il creates capitol, bu! il adds 10 the a.
mount Of CAPITAL seeking Investment He.e then,
there viii be combination OF the very two circufn
stances which operate to increase The price Of conmo
dity, viz increased demand and diminished supply
the one created by paying off much OF tho public
debt the other by diminishing SO much Of the public
| funded stock.
MIR b. here presented te result oGsope calculations
Which he had made, with view to shew how far facts
went TO justify the principles he had laid down But be-
fore he exhibited them he wished 10 premise ;ba they
bad been made from the best Information he could OBJ
tain UIat they did aim mathematical exaciness-
fractions and even small sums not fractional having
| Fore arn,,I- i, had IL
tee OF the difference resulting from tie receipts Of d.
vidends from the Bank, being half yearly while tie
payments of interest the public stocks we're GUAR
ery His object vas TO approximate the truth 10 its
great outline, without attending 10 its m,nucst parts
! lie would first eudeaYuur 10 show what was the pre-
sent average rnle Of profit capital in the United
States. The per cent. United Staes' stocks are ct
this time selling at 81 per cent oftheiT nominal
/ Taking them At 81 per cent the actual annual pro
1T realized by the purchaser, about 81 per cent.
But as this description of Stoke were redeemabia at