Wilmington journal. [volume] (Wilmington, N.C.) 1844-1895, 1847-12-17


and when transfers unprecedented in amount
were required at distant points for disburse-
ment During the last eleven months, the
government has received, transferred, and dis
bursed, more specie than during the whole
aggregate period of ffty-seyen years prece-
ding, since the adoption of the constitution.
To render the system still more safe, useful,
and economical 10 define more clearly the
powers of the department., and especially to
render more secure I" the public money in the
hands OF disbursing agents. the amendments
suggested in my last annual report, Qncludlng
the establishment of a branch mint at New
York } and which received the sanction OF the
House of Representatives during the last ses-
sion, are again recommended TO the favorable
consideration of Congress. During the year
ending 30th June, 1847, our imports OF specie
were $24,121 ,289, (see table To most OF
which, under former systems, must have gone
into the banks, to have been made the basis
OF ISSUES OF their paper to the additional a.
mount of fifty or sixty millions of dollars
Such an expansion, during the last spring and
summer, accompanied by still higher prices,
and followed by greater fall, and by bank
ruptces in England 10 an extent heretofore
unknown, finding our banks and credit great
ly expanded, and reacting upon this expan-
sion, would have produced a revulsion here
exceeding any that has heretofore occurred in
the country A general suspension of the
banks would probably have resulted; depres-
sing the wages of labor and prices of property
and products; affecting injuriously the opera
tons and credit even of the most solvent, and
producing extensive bankruptcies. From this
revulson we have been saved by the constitu-
tional treasury, by which the specie imported,
instead of being converted into bank issues,
has been made to circulate directly to great
extent as a currency among the people-hav-
ing been re-coined here during the last eleven
months by the new orders of this department
under the act of 9th February, 1898, and the
Jealous cooperation of the able and efficient
head of the mint at Philadelphia, to the I'M
precedented extent of S2O,758,O48 10; and
there are thousands of our citizens now SOL
vent and prosperous, who have been saved
from ruin by the wholesome operation of the
constitutional treasury. The banks that so
unwisely opposed the system have been res
cued, probably, from another suspension
their stockholders, depositors, and note-hold-
ers, from severe losses and the country and
government from the ruinous effects of de-
preciated paper currency. If the union of the
government with the banks had continued,
and their suspension and the depreciation of
their paper occurred during the war. requiring
large specie disbursements, which suspended
banks could not furnish, consequences the
most disastrous to the honor and the interests
of the country must have ensued. The gov
eminent is now disconnected from hanks, and
yet its stock and notes are at par, although we
have been constrained 10 contract heavy loans,
and to keep larger armies in the field than at
any former period. But during the last war,
when the government was connected with
banks, its six per cent stock and treasury
notes were deprecated twenty-five per cent,
payable in bank paper twenty per cent. below
par; thus amounting to loss of forty five
cents in every dollar upon the operations OF
the government. In my first annual report to
Congress, on the Sd of December, 1915, in re-
commencing the adoption of the constitutional
treasury, the following observations were
made:
"Nor will it be useful to establish a constitu-
tiona treasury, if it is to receive or disburse the
paper Of banks"
"If paper, in whatever form, or from whatever
source it may issue, should be introduced as a cir
cuIaton by the constitutional treasury, it would
precisely TO that extent diminish its use as means
of circulating gold and silver"
During and before the commencement OF
the last session of Congress, twas thought by
many that this measure could not operate sue
cessfulIy during war, and that large loans
could not be negotiated if the payments were
required in specie. The department, howev-
er, adhered to the recommendations of its frs
report, believing that the government would
be rendered stronger by the divorce, and thai
if the treasury should resort to banks to nego.
tate its loans or supply its revenue, that both
If the war continued, would be involved, as
they were in the war of 1912, in one common
ruin. During the months ofiJune, July, and
August last. (per table NJ the sum of Sc, ooo,.
600 was transferred from the assistant treasu
rer of New York for NECESSARY disbursements
at New Orleans and in Mexico. Heretofore
the public money being deposited the
banks, and loaned out to their customers, wher
, such enormous transfers were made q con
traction of the banks with runous losses mus
have ensued ; but the money OF the govern
ment is now transferred from New York Il
New Orleans, and scarcely affects business o.
the money market, because the transactions O.
the government are disconnected from those
OF the banks. When the government former
ly received and disbursed only the paper O
banks, whenever revulsion and numerous
bankruptcies occurred in England, they uni
versally reacted upon our perilous paper sys
TEN, so as to create a pressure in our none,
market, large and sudden contraction of tn
paper currency,a calling in of heavy loans b.
the banks, and, as consequence, many fail
ures, and most frequent suspensions of speci
payments. Now, for the first time in our his
tory, although failures in England of the mos
unprecedented magnitude have occurred, in
Guiding banks and bankers, yet our banks an,
credit are sound and stable, and the bushes
OF the country is still prosperous and progress
sive.
Nothing is more injurious to all classes, blu
especially to our manufacturers, than the ex
pansIons, contractions, and fluctuations of tn
> bank paper system, vibrating with every con
siderable change of the public moneys held b.
them as repositories. This perilous and Sc
:, ductive bank paper system opens temporarily
8 and beyond the wants of the country, mar
ket here for foreign imports, not in exchang
! for exports, but for credit; the redemption Q
q which drains the country of its specie, con
tracts the paper currency, forces, at sacri
flee, the sale of domestic fabrics, and depres
; ses the industry of the whole country. Do
/. nestle manufactures require for their perma
nent and successful operation the basis @
: specie, checking vibrations and mutations O
the paper system, combining our imports to tn
wants of the country, and preventing the tenn
= porary purchase of foreign goods for credit
and not for exports, which always results i
. disturbance of the monav noarLof ,nd IN IN