Wheeling compiler. [volume] (Wheeling, Va. [i.e. W. Va.]) 1829-1831, 1829-07-01
STATE OF THE CURRENCY

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system IN tie United STATES.
There is no subject more interesting TO
a community than the state of the curren-
cy, or circulating medium, because it is
the standard by which the value of all
commodities is ascertained, which are the
product of labor Sudden fluctuations in
either its quantity or value, are always 10
be deprecated; as they vary this standard.
and augment or diminish the stipulated
consideration in contracts.
The coinage of money, and regulation
Of lis value, have, by the constitution,
been wisely conferred upon the federal gov
eminent; while state sOvereignties have,
by the same instrument, been prohibited
rom the right to "emit bills Of credit, or
make any thing but gold or silver coin a
tender in the payment of debts" So far,
therefore, as the constitution could, it did
provide tor currency Of uniform value
throughout the United States.
A nominal uniformity Of value, in the
currency, may be attained by legal enact
ments: while uniformity in quantity and
consequently in real value, depends upon
those laws Of trade which are beyond leg
iSlative control Ii will not be necessary
to advert to the colonial history ofour place
in relation to both their commerce 81 their
currency, when their government was sub
iected TO the supervision and control Of
the British crown, are too recent to re-
quire enumeration. Nor will II be neces-
sary 70 state that While the only LEGAL cur
rencv which has existed in the United
States, since the adoption of the federal
constitution, is GOLD and SILVER, the
actual currency Of the country, has been,
during that time, bank notes, payable or
redemable in coin with more or less ex-
pense, delay and risk to the holder, ac-
cording to the circumstance, of place
where, or time when they were held.
A brief retrospect of the commerce and
currency Of our country, since the esiab-
lIshment Of the general government, may
be proper in the present enquiry.
Soon after the close of our revolutionary
war, and while our country was IN a state
ofgreat commercial depression, the French
revolution broke out, which in its progress
involved nearly all the nations of Europe
ia war which terminated only after the
duration Of nearly thirty years. During
this protracted period. the neutral ground
assumed by the u. States threw a great
portion Of the commerce of the world INTO
the hands of American merchants. They
became the carriers for nearly all the bel
Iigerents; and the profits they derived,
with the enhanced value Of our domestic
produce in foreign markets, produced a
balance of trade in our favor, which pro-
cuded the possibility Of coin leaving the
country, except IN the character Of an ar.
tlcle Of commerce.
Il was during this period that nearly all
the banks in the United States were esiob-
llshed. there ostensible object being to IA
cditate commercial operations by the loan
ofmoney, while their real effect was 70 ere
ate a circulating medium, and, m fact,
make money, or substitute for It, having
as a basis coin, which they held ~ suiiici-
ent quantity only to meet the current de-
mand IN the redemption Of their notes.
/ BY this means the currency was prOba-
bly, augmented to four or five fold the
amount Of the coin upon which II was bas-
ed. No evil did or could arise from tgIs
state ofthings. The currency ofthe coun-
try was not increased to an amount great
er than was required by the wants Of the
community, while, if bank notes had not
been used, it cannot be doubted that an
equal amount Of coin would have been IN
circulation. and loss to the public have
been sustained to the extent Of The interest
on that portion Cor which bank notes were
made the ubstitute.-The nation was,
therefore, gamer, at the same time that
the banks were deriving great proh' from
lending their credit in the form OF f'otes'
instead Of lending no more than their actu-
al capital. which must have been the case
If bank notes had not been tolerated as n
Circulating medium. An this could be,
and was d5ne, with perfect security 10 the
banks and the public, because their notes
were more convenient medium Of ex-
change between individuals than coin,
within the country; and coin would not be
required for export % as great an extent as
II was imported, because wo were a com.
munity Of creditors instead Of debtors
To such an extentdid the balance Of trade
accumulate in our favor. during the prohl-
bition to import British goods which exist
ed previous TO the late war, while the mark
cts Of the world were opened for the export
ofour domestic produce. that exchange 90
Europe fell from fifteen or twenty per cent.
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