Weekly national intelligencer. [volume] (Washington [D.C.]) 1841-1869, 1852-03-13

u1HtTIng VtIy WIutIy tH05t
which should regulate currency The notes representing
specie depotes and used to transfer and Offset the balances
Of trade, had performed highly useful function and had
nterfered with the specie standard OF value IN no other
way than by economizing its and in enabling less to
discharge the Office of payments If there was ten
dency to contraction of the specie standard the bust
ness OF exchange became more active and thus conrbu
ed TO keep to proper level the currency value Of the
precious metals it, the other hand there had been
tendency expansion of the specie medium which has
not existed since about the middle OF the sixteenth
ury the bullion value Of the precious metals would RISE
and thus tend preserve the true standard But when
banks undertook TO carry the business of exchange
offset by paper which represented neither depostes Of
specie nor actual balances Of trade but which undertook
to find either the specie the bills founded upon real
balances whenever they required at certain place.
the whole subject passed from the regulation of the
ural laws of trade, and placed under the manage
ment Of artificial and empirical rules, which, however
ngeniousy conceived and fuly administered have had
the effect to derange often the whole system Of exchanges
and of commerce in the world. As this paper took the
place specie the currency value of the precious metals
diminished, large amounts driven into the uses Of
manufacture which ought to have been employed
rency and the great law Of nature thus suspended
for time which, by increasing the value Of specie would
have directed more labor to producing it, IT. them specie
enough could be furnished to perform all the Offices Of
circulation and to Danish all paper from the of
rency, except such founded upon exchange Of
real values consisting either in specie actual balances
arising in the operations of trade who could doubt the
beneficial results from such state of things? The vbra
pansons of such currency for the period which would
embrace the transactions Of generation would never be
such to produce 1.-THE of the calamities to which
paper currency has often exposed and commerce.
would be secured from of risk vastly more pro-
life and dangerous than all those against which insur
ance Offices undertake to provide.
If the preceding views correct there is no just
to apprehcnd any dangerous expansion Of the
rency from the increase of the precious metals The
nua production of gold and silver probably does not
coed $150,000,000 but the interest upon the public
debt of Europe alone. Mt per cent per annum, would
amount to 1926 824 And the annual production of
the United States is probably at least four times that
Indeed there is to believe that the value Of the
property of the world is increasing faster than that of the
precious etals with the sources OF supply to
the latter. Now, there be no danger Of an undue
expansion of specie currency until the stock is increased
beyond the point Of which speaking, and up to
that point such an increase would prove unmixed
blessing Indeed increase Of specie produce
expansion if should have but specie currency
until there is enough take the place Of the paper money
aoat In the United States alone the bank notes in cir
cuation in 1850 according to report from the Secretary
of the Treasury which included returns only from por
ton of the banks amounted to $13l 526; and this
constitutes but small part Of the paper money of the
world But would any possible increase Of the precious
metals supersede paper money and leave nothing in cir
cuaon but the paper of exchange? Unless Governments
interfered such might be the effect of sufficiently large
increase of the precious metals The expense of issuing
promises to pay in specie in other words of issuing
bank notes in the usual FORM is not measured only
sometimes asserted by the value of the paper and print
ing but is another form of the great business of exchange
by which banks persons undertake to transfer and Off
the actual balances of trade by of credit instead
of money When specie is and dear this business
is profitable but as the former becomes plentiful and
cheap the profits of the latter Decline and dealers win
pay for promise to furnish specie in mode which
involves chance Of failure when it is SO abundant that
they may readily obtain bills drawn upon actual deposites
The probability is that the whole amount Of the pre-
cious metals raised annually after deductng the quantity
lost the stock of the world abrasion and other
does not amount to the banknote circulation in the Uni
ted States alone In 1903 Humboldt estimated the
nual loss plate in Europe alone from abrasion and
other 81 100000 The loss coin by abrasion
estimated by Lord Liverpool at per cent the
guinea and two per cent half guineas for fifty years.
and in eleven years onefth of per cent on crowns
oneninth per cent half crowns upwards of FIVE per
cent shings, and three and one-seventh per cent
sixpences Some idea may thus be formed Of the
nual of the precious metals which is to be
from the $l50000000 which probably raised in the
year. Upon a review Of oil the considerations which
affect the questions submitted to u.s. there would
be danger from undue expansion of the standard of
value, if we bring into active both of the precious
metals and if the annual supplies ofboth to increase
beyond their present annual measure 1t is true that
none but calculation of approximation can be made
upon this subject The data too complicated and
certain to enable TO mike estimate Of the
ues of the specie of the property of the world But
since the middle of the seventeenth century there great
reason believe that the value of the specie standard
has contracted and there grounds for supposng
that in the United States this tendency has not been
rected even by the production of gold in California The
of 1851 witnessed pressure in the money
market in New York. and exhibit of the banks Of the
State of Massachusetts for the year 1851 shows that the
proportion of their liabilities for circulation and deposes
was to their specie 1317-710 to ], which is far
greater proportion than was ever known in that State
from 1915 to 1851 with the exception Of the two years Of
1885 and 1886 (See Hunts Merchants Magazine of
February, 1852 p. 222.)
This state Of things probably brought about in part
by Of silver beyond the under
law The silver coin left and stimulated importations
from the places where 1t went Gold did not Immediately
replace it circulation indeed for the purposes of small
issue notes to supply the vacancy in the currency Had
the market and mint prices of silver corresponded in the
United States, should probably have nothing Of
oil this Although it is possible that the first effects of
large influx Of specie might be increase Of bank paper
yet this is evil which the laws of trade would soon COR
rect Should however, the present state of things
tnue in relation to silver shall not only lose the adj
vantages Of the abundant Of the precious metals for
the purposes Of standard but we lose the specie
standard entirely in the smaller exchanges of society
is doubtful whether the dollar gold piece maintain its
place in circulation and smaller values in that metal
hardly be used for coins This then be sup
piled by bank Of the very worst kndthe notes of
smaller denominations Somuch Is the value of currency
affected by the facility with which may be counted and
its convenience of transportation that there viii always
be difficulty in supplying the place Of small notes with
any thing but silver that of large notes with any thing
but gold We require then, for this reason the double
standard Of gold and silver. But above all do require
both counterfeit the tendency of the specie standard
under the vast increase Of the value of he pro-
perty of the world. And what harm arise from any
probable increase Of the precious metals, IL both
allowed TO swell the volume Of currency On the con-
trary beneficial event for the trade the industry
moral political condition NJ word copld