Liberty advocate. [volume] (Liberty, Miss.) 1835-1866, 1838-05-26

would prompt him to divert his capital In
to the most profitable channel Of business,
to wit; the agricultural or manufacturing
pursuit. Imagine the whole capital Of a
nation consisting in gold and silver, and
you imagine acountry in which the peo-
pie would all be lenders, and no borrowers.
No one would borrow money, for the plain
reason, that he could not convert it into
any other channel Of business, and, conse--
quently, there would be no possibility of
making cents profit out of the borrowed
capital. But no rational man could ever
dream, least ofall, hope, that such should
be the condition of our country. Nature
has decreed others@se She has establish
ed diversity q soil and climate, adapted
to the producdbn Of different articles or
commodities. To that nation, whose soil
and climate fit it for the production of q
certain commodity, she has said, exchange
the surplus beyond pour wants for the sur
plus Of any other commodity beyond the
wants Of another nation blessed with diff
ferent soil and climate, and thus mutually
promote the welfare and happiness of each.
The God of Nature has ordained the So
ciality of nations, and mutual commerce.,
seems Of necessity to spring from his i'm
mutable laws This exchange of the
surplus Of onecommodity, for the surplus
Of another, may do to carry on commerce,
on broad, comprehensive scale, such as
peryades thetransactions Of nations. But
TO limit individuals in their minute con-
Germs, to the same awkward and bungling
mode Of exchange, would be absurd
Hence originates the necessary for money,
or circulating medium. have noticed
above, the folly and absurdity, of suppos-
ing that the whole capital ola people can
consist in gold and silver. Here must be,
then, certain proportion Of money, or cir
culating medium, to the capital, or rather
the annual product of a country. What
this proportion is, has never been definite
ly settled. In establishing the proportion,
it should be borne in mind, that the more
enterprising a people are, the greater
should be the proportion OF circulating me-
dium. This latter circumstance though
generally overlooked in fixing the proper
ton, should not be lost sight of. Some
have fixed the requisite proportion Of cir
culatng medium, to the annual product, of
a country at,1-5. Others have fixed it at
100. Making all due allowance for the
infancy of our country, and the enterpris-
ing character of its inhabitants, we may
safely fix the requisite amount of money
here, at Is of the annual product By es-
timating the annual product ola commun-
~, at Ito, Of the gross productive capital,
which we think a good average, the requis-
lite proportion Of money to the gross pro-
ductive capital of country can easily be
ascertained. By taking the requisite a
mount Of money at l-3 of the annual pro-
duct, and the annual product at lilo, Of
the gross productive capital, we have the
proportion Of money to the capital Of
country from at 100. Whether the people
of our country have wofuly aberrated
from this golden proportion, it is not our
present purpose to enquire. In our State,
the proportion has been completely revers-
ed, and instead Of fixing the necessary a.
mount of money at l-9 Of the annual pro-
duct, it actually exceeds the annual product
ofthe State. Beyond the requisite amount
of circulating medium TO country, specie
is worth no more than an equal value of
any other commodities. When motion
is furnished with sufficiency of circula-
ting medium, or the precious metals, it is
useless to force specie into the country be-
yond this point, for il will either seek
market where ii will be more profitable to
the owner, orif it should, for the want Of a
better market, flow in with the circulating
medium, and remain in the country in the
latter character, the volume Of the circulu-
ting medium being enlarged, will necessa-
rily depreciate, Or be diluted in its value,
property will nominally rise, anditwillre-
quire more specie to perform the functions
Of money ID its diluted state, than when
filling the diversified channels Of business
Units former salulafy proportion. II 10 be
ccntinued,l al