Richmond enquirer. [volume] (Richmond, Va.) 1815-1867, 1835-06-26

cICct Produced on the circulating medium by n rl-
pd or sluggish circulation. And it is very evident,
tiat while the quantity ofthc currency remains the same,
its apparent amount and real efficacy may be either in
creased or diminished, merely by an increase or diminu-
I n Dfthes apidity of circulation. For example. $40
passing through ten hands, in the course of the day, will
accumulate as much property as 500 passing only
circulating medium TO remain stationary in amount. but
that the rapidity Of its circulation is suddenly doubled
uoushou' ,he whole country, thenits epgarents mount,
and ITS rem efficacy would be doubled hkewv =. With
the help Of these incon;rovcrtiLle principles, let us now
proceed to examine into the effect ofthc late money pres
sure IN the United States. LIST. On the rapidiiy OF the
clrcuiauon--and 2dly. On the amount ofthe circulating
medium.
Isl. Eject on Circulation.
l shall not pretend 10 enter into an investigation of
the causes which produced the late pressure i'm the mo-
ney market. The nation has already been fully and COM
plclely enlightened upon this subject, by men whose
minus can compare with any which the world can fur
nish Moreover, it would require me to enter more fully
INTO the field of politics, than would be agreeable to my
sell, or suitable to an agricultural Journal. Suffice il to
say, that the pressure did every where take place; that a
general difficulty of procuring money existed throughout
inc country; that prices, for a season, fell every where;
ana mat confidence and credit, for Il short time, in the
great commercial towns, were almost entirely DESTROYED.
First, let us see the effects of all this on the exchanges in
currency.
During n pressure Of the kind inst spoken of, the loss
oil confidence and fall of prices, force a great deal of real
ana other property in the market. to be sold for payment
OF debts, which ordinarily remains stationary in the hands
OF It's owners. Lands, houses, negroes, stocks of Foods.
&C. are 'hus forced to change hands, and Of course in
tiAauPo tt I'M Vi prices C.
morally may have 4 tendency to diminish the sales of
the annual products Of the soil; such as corn. wheat. IN.
bacco. and sugar; but not of cotton-for the FOREIGN mnr-
aet is the regulator of the price of this very import
ant article. Hence 1t may be said, that a money
pressure at hrst has a tendency, by the great guam
IVY oil property forced into tho market, for sale, ra-
tner to increase than diminish the number Of ex-
changes. Whilst, however, the number of EXCHANGES
increase, the circulating medium suddenly becomes much
more sluggish, taking the whole aggregate, in perform
ing the functions of circulation. The great capitalists
who are in the habit of purchasing produce with a view
TO sell with a profit, when prices are falling, rather keen
siooi from the Pur base Of raw produce, lest a further
tall may injurc them-thcir capital then circulates more
Slowly, ana IN consequence of it, the annual productions
oil the country are not distributed with that regularity,
and adaptation to the various wants Of the community.
as under ordinary, circumstances. The body polite in
this situation, is like a patient suffering congestion in
one pait of the system, while there is u depletion, almost
to the loss of vitality, in another.
Again-bonds, bills of exchange, &c. ordinarily per-
forming the larger portion of the circulation of every
country, have now a muck slower circulation, and conse-
quenty less eficacy in cifecting the exchanges; because
as 'hrre IS a general loss of confidence and credit, y,
whohas sold TO b, is distrustIul of his bonds, his bills, in
fine ofcredit in every shape-hc wants money. Money.
too, has generally n sluggish circulation on such occa-
slons, Tor every one getting possession of it, is disposed
u hold 1T as long as possible-hard money seems to he
almost the only true friend which one can get hold of i'm
such umes MS those, and is consequently held with a
miserly grasp. Persons will not venture it out without
the best security, and on n high rate of interest, obtained
either directly or indirectly
Thus we find, first, that the number of EXCHANGES has
4 tendency to increase during the first operation of n
money prcssure; and second, that the whole circulating
medium OF the country suddenly, from the very same
cause, diminishes in the rapidity of its circulation. and
therefore becomes less eiicacious, as | have already
proved.
End Effect Of money pressure on actual amount Of circu-
dtiRg medium.
Let us now examine into the state of the circulating
medium, and see whether during a money pressure, il
has any tendency to increase in quantity, so as to conn-
teract the operation of the causes above specified. IL is
evident, first, that the money has no tendency 10 increase
in quantity; because, first, the Banks are distrns,ful of
the credit OF individuals, and of one another; the cur
tallment forced on one, communicates TO another. and
finally, all arc obliged to curtail their accommodations
and issues-hence a decided diminution in Bank paper
Secondly, gold and silver in actual circnlatidn diminish
es in amount, becaSs9 of the universal disposition to
hoard, in consequence OF loss of confidence. Thirdly.
bonds and bills of exchange will generally diminish in
amount, because these depend on credit altogether, and
pae hrst effect OF the pressure is the destruction Of conf
dence, and the ruin OF the whole fabric of credit. Fourth
iy, stocks OF every description diminish in value, or are
entirely destroyed by the disastrous operation of the
times. Money, and not stocks, is what the times call for.
And thus do we see, that while the exchanges increase.
the circulation of the currency grows sluggish, and the
quantity In actual circulation rapidly diminishes.
(I0 lie concluded an our neIk)
An ineonvertble bank paper is never hoasled in this manner,
~ IS IKE he M each mans hands; ho wants To get rid OF il as sp.cdi-
" $ possible, lest 1t my be caught on him alta still lower point of
appreciation. Hence the inconvcriblc paper OF the Bank OF Enc
iund, IN l'S', soon relieved the money pressure, hut only to brin9y
on eviisg greater still, as an inconvcrtiblc paper always windo