Lynchburg Virginian. [volume] (Lynchburg [Va.]) 1829-185?, 1840-02-17

pulse 10 prices The first instance and this generates
spltit OF speculation which. In IT'S turn, nerease'
tho banking credit. Mr.. Took. In liz able ant
practical woik on high aud low prices, has show,
most renciusi,el, that banks rarely set the bali u
speculation IN motion, beng rather The effect thar
the cnusr
Having made these general observations that
portion Of the Presidents Message, which would
seem to charle all or difficulties upon the hanks,
shall nov make lew observations upon the cha
ractcr Of the American and British trade, with n
view vi illustrating sumo OF the remarks already
made. aud To prove thai The present crisis nnde,
which we are suffering. 80 FAR ttom establishing the
policy of the Subtreasnry scheme NJ the President
asserts. exhibits on the contrary its Iuinious tenden-
ey in light which should remove seep,icism from
every mind. In looking 10 the external commerce
ofour country, there ~ ONE commodity which NJ
ooce fixes the attention. rs being the most important,
as oil as the most valuable of our exports. This
is cotton. II is the Atlas which npholds our whole
con,me,c ial system. Its the commoilly whcb pays
Tor the greater portion Of all or imports. and Is pro-
dncrd alorc 10 The southern States. II is the com
noIuy therefore whose condition to quantity and
price must most influence ioteIgn commerce and
foreign exchanges whilst il erecis aud supports AT
homr, to II great extent tie whole system OF our
public mud private credit. Suppose, Tor example,
that th, important article sAoud continue to rise IN
pnce Cor series Of years IN sneccssiop II ilfasy
10 see how ii would generate spirit Of speculation.
which would eventually communicate Itself To all
both private and public, would be digiously
arecd. Tho first effect of the rise Is iuo, dnaioy
hrh profit on all the cotton lands. These lands be.
GIN to rise. and negroes likewise. Then there is
rush in the tide OF our population 10 these lands.
where great fortunes are IL be mndc-lhc effect col
Investigation added the influence OF the HIGH pice
Of cotton carries up the price Of land still higher.
Those who bought ltilc before have become
wealthy by The change in value alone. Rlcn begin
TO buy to make fortunes by the rise in The p,'oe
of land not bv cullivaiing II. Thus the public Of
speculation is blown 10 lis nimos, tension. In the
meantime the whole system of credit rapidly extends
itself The general rise III prices produces aneces-
shy lor an increased currency. Upon the same
amount OF property much larger loans can he ncgo-
taied because fihe iurroase ot price; aud ut The
same time every man pushes his credit 10 the ex-
IRENE because OF the high profits q rh he has al
ready realized or of hi. high expectations for tho
future. Thus whilst capital and populaton, from
other portions OF the uhion, are flowing into this
country, il i. At the same iimo purchasing labor.
stocking land aud buying goods on ctedn--all de.
pendent on the high expectations OF tho future.
Let us now sec how this advance Of prices may
finally communicate Itself 10 other portions oi our
Uniun. THIS is done not dUecttu but ,hi,rcciy.
The high price of COTTON excludes The production II
all other Articles the cotton country but the great
siaplc--hcnce this country becomes new mar
ket FOR bread SUITS. caille, horsts, hJgs. DC aud
thus has tendency 10 raise other agricultural pros
duets while the movement Of labor and capital from
other pn,tions Of the Union To The cotton country
enhances still further tins result.
Again the price Of cotton stimulates the mcfcan-
tile ine,es, Of tic North by The immense amount Of
inpoyts which IT orcrs into the country because Of
the Great amount ol exports, and the cotton country
becomes an increasing market Tor manufactures be
cause of the Increase VI wealth and luxury. Now.
at This stage If the price ol cotton should become
permanently fixed at high rate. we should have
ovrr,radnp, but II would not be ruinous.
.. mi oI Cutfo
high prices generally, and Of course, large super
structure OF credit. would be tight and proper lbal
The latter should exist coniempofaneousiy with tile
fm n,cr and, long ~ the nature Of man remains
unchanged. they will exist Together. But, suppose,
instead If the price Of cotton fixing itseil NJ petnia
nen hieh rale 4fer long period Of advance. il sud
lenv and xpeeedly begins TO decline aud finally
sinks perhaps, 10 half or nehlfd lis former value
do we sec at once cause ior widespread iuin,
and an in,mcnse destruction Of private and public
credit You have, IN fact. pursuing the smlie al
ready used. thrown down the Atlas that upheld the
snprrslructutc. The whole round of speculation
suddenly sops-lhe whole class 81 colloI merchants
VII have bought on credit become suddenly and in
rxtrcsby involved. and unable 10 comply with their
contracts. The planter has not only borrowed. on
III faith Of the wcseni crop, hut he has anit Ipaed
those to ceme former high priccs-his creditor
can no longer wait payment for he, IN turn, Is
pressed from some other quarter. This brings an
immense amount OF land aud negroes into the mar
ket which, Of course, SINKS Their price Ia mos
ruino us pitch OF depression and thus The debt which
on ycsieray bore upon the iafmer as lightly rs the
feather in his cap. when cotton was selling ~ ) or
20 &c ats the pound, hangs day about his neck like
a millstone when prices have suddenly fallen TO 3
10 cents. II is impossible Tor an agriculture country
10 nav q great debt Immediately II must wait for the
slow annual returns of lis crops. and take all the Ia
2 ,rIs ul he markets and the seasons. Thus the rate
of exchange rises TO enormous extent against The
cotton country, which IL the debtor portion Of the
! Union and IN l.vpr Of tie North which generally
becomes the creditor by virtue OF it's capital. THIS
rapidly der,ugrs The currency of The cDunry while
foreign exchange suddenly aud alsfmngiy t0rns IA
ranst us Ut the same time, as may be readily ex
claimed. Thus the high p,ice OF cotton makes our
exports pIea--tb0so. IN u year 81 two. VIII be sure
TO produce CORRESPONDING Imports. Besides. ours
being the young country. with an immense field or
adventure vii ueees,anly. atsuch time, attract Il
/ large amount Of t0reIgn capital Thus, upon Tue
whole. perhaps in spite oil our large export. we be.
come the debtor naon, even wrh an exurbi'anl
mice for our great export staple. Just AT such n
with which all our debts to have baeo pad aud
i the equilibrium maintained. cause an immense ba'
lance To appear suddenly against us. Suppose the
ton crop sells Tor hall lis former ptIce aboard sun
h1ye il sunlly tins single transaction, hI!arce
against the county 10 the amount ut one.haif al
what your cotton crop formerly sold Or. This sud
lea turn in The exchange, aggraya ed by the sudden
demand fur Eavment OF debts wlch would not under
other circumstances be called lor, produces an nm
! mense de a,and for specie. Enrupe calls for II al
the importing puinis--at New York, Philadelphia,
Has,nu and Il ,Itimnfe These citie, call suddenly