The daily union. [volume] (Washington [D.C.]) 1845-1857, 1846-04-25
THE TEMPORARY PANIC IN NEW YORK


A kind of panic prevails in New York. The
prstsrt for il is the passage Of the "sub-treasury
bill" by the House. An intelligent correspondent
thinks the real causes for it are the following:
First The great expansion made by the banks
within the last eighteen months or two years one
Of the effects Of which is TO be in the nereas.
ed import Of foreign goods in the face Of srpsetsd
reduction ofthe tariff Other effects are visible in
different parts Of the country
Secondly. The railroad mania in England This
| causes demand for money there; and as America
is always in debt to England, an increased demand
for money there is generally felt with more less
| force here.
Thirdly The uncertain nature Of our relations
with England
"Eourihly. The recent news from Mexico.
"FythIy. The Canadian government is drawing
bills on England, and selling them in New York
for whatever they will bring. This is causing large
expectations Of specie to England, inasmuch as
these bills are either directly indirectly, paid for
in specie.
ain this way the British government, through its
agents in Canada, are trying TO cripple our banks,
and thereby to cripple our government, as all the
| funds Of our government are at present in the
banks.
at was stated by Mr.. John Smith, who was at
that time United States marshal for Pennsylvania,
that similar demonstration was made by the
brlusn autnOrltles on our banks IN 1914; and ne
gave il as the immediate cause Of their suspending
specie payments.
IAN operation Of this kind, or unintended opera
ton Of this kind by the French authorities was
said by some the immediate cause Of the suspen.
sion ofspecie payments by the Bank Of England in
1881"
But the panic must be temporary. The "consti-
tutional treasury" will probably pass in shape
that will permit the banks, except in very extraor-
binary cases. to retain the present funds Of the gov
eminent to remain with them, until they are gradu-
ally drawn out by the wants of the government.
A hard-money correspondent, who has studied
this subject with great care, and is no friend to
banking institutions, is of opinion that
"The Chamber Of Commerce of New York, in
their memorial to Congress, greatly exaggerate the
inconvenience Of paying duties in gold and silver.
Foreign coins are legal tender at so much penny
weight but even if every piece were separately
counted, this provision Of the bill would mot be
found wholly impracticable and physically impossi-
be-
"But whatever system we may adopt-whether
national bank, pet bank, or sub-treasury-treasury
drafts 10 run for certain but not long me) will be
used These will be drawn against specie in the
sub-treasuries. and these will be used by the mer-
chant in the payment of duties"
He illustrates it by the following:
"For example: Drafts on the sub-treasury at
New York may be issued to the clerks here in pay.
ment Of their salaries. These will find their way
into the hands of the traders here who buy goods at
Baltimore Philadelp hia, and New York. The mer-
chants in those cities will receive them in payment
for purchases from them, and with them pay their
dues to the custom-houses.
CAT all events, there will be no such carting and
| recarting Of specie as the New York Chamber OF
Commerce ignorantly imagines."
We agree with our correspondent perfectly in the
opinion, that it would be well if the sub-treasury
system and the warehouseing system could be
| brought into operation simultaneously.
He sees no objection to "the approach to the new
system being gradual and progressive" provided
the progress be not too slo,o.
"a mint agency at New York, which should re-
| ceive foreign coin and bullion and transmit them to
| Philadelphia for coinage, at the risk and expense Of
| government, would be much less extensive than
a new mint, and could be more speedily brought
| into operation"
The New York Chamber of Commerce "fill,
in The principle that il IS neither desirable no,
erpedient that any portion Of the public money should
be used in loans to any branch Of commerce or trade
This is taking ground against both the nationa
bank and the pet bank systems, dscounting fol
their advantage and extending the fictitious circula
ton of their paper upon the funds of the govern
ment. This is something. We are happy to ne,
the Chamber of Commerce of New York take such
a bold and correct ground.