Indiana State sentinel. [volume] (Indianapolis) 1841-1853, 1845-08-07
sPFcfr AND RANK CIRCULATION STATES.
a

The paper circulation of twelve States of the Union
is reduced from -four TO thrtyfour millions, while
the banks issuing the latter sum held more specie
than did the ssuers of the former sum. The year
1885 was not the year of the great western bank ex
pansion 1t was then that the Specie Circulation
gave activity to the precious metals, and caused them
to go west and the circulation rose IN Mississippi to
Sl6,OOO000 in 1889; in Illinois to s4,OOOOOO; in
Alabama and Ohio to $4,000 900, followed by
complete explosion. 1t is evident now that the
dition of the currency south and west of New York
is as great whole little If any above specie level,
and that therefore the volume of the currency could
in no wise be disturbed by the Redistribution Of the
spece features of the Sub-Treasury law The return
of the banks in the above table, about January,
1885, say sixty days after the first Specie Circular
began to operate to which circular ascribed the
most terrible results when in fact 1t only forbid the
receipts for Government dues Of bank notes OF de-
nomination less than FIVE dollars, and after March,
1886 less than ten dollars. In the mean time, land
speculations reached such an extraordinary height,
that in July 1896, gold and silver only ordered
be received for land exceeding 800 in quanti
ty The bona fde settlers were thus allowed the
same privileges before, while speculation was de-
stroyed, public lands could longer be obtained
for valueless credits. They were bought only by in
dustrious settlers, who had the to pay. The
sales of the lands fell off as follows:
1884 1885. 1886. 1887
H 4sIs: sold sssss ios sesss
Now it is observable that the effect of the circular
was not to drain the banks of specie, alleged, but
TO stop the speculation lands and reduce the sales
TO the actual settlers The distress which followed
was that of the land SPECTATORS only growing out Of
their obligations the banks, and caused not by
the action of this Government but by the movement
of the Bank of England which issued in the summer
of 1886, summary notice to the American Bankers
in London, to curta their American credits This
letter created foreign demand for SPECIE which de-
stroyed the spectators
Now il will be observed that had the specie circular
always been in operation, those specuations never
could have taken place. and the consequent distress
never could have followed The sales of lands would
have taken place regularly the demand for actual
settlements existed. As for instance, the sales Of
public lands during the year $40, when the Sub
Treasury was in operation amounted to 81, 7o9 637,
nearly large in 1888 before the specusations
commenced. The actual settlers having the means to
pay for land experienced difficulty IN the purchase.
Now, at this time there speculations ahoat,
and comparatively no credits outstanding, hence the
only effect which the restoration of the SubTreasury
can have, will be to prevent speculation Precisely
on the principles that the currency of England
has been restored a specie level at time of low
prices produce any actual change prices but
to prevent those prices from becoming inflated by an
undue expansion of the currency. There could not
by any possibility be more favorable moment than
{ the present for such movement More especially
as that the bank fever is again beginning rage In
Pennsylvania, 81, 100000 of capital Is project
ed and in Ohio banks are crawling into light like
f reptiles in the In all directions, to
bank speculations is apparent and the corrective OF
= the Government should be applied before the evil
n gains head.