The daily union. [volume] (Washington [D.C.]) 1845-1857, 1853-03-04
COM
srsaa our Commercial Correspondent.



Ngw Yosx. March 1, 1898.
The money market ia this city aud In some OF the neigh
boring has latery undergone slight degree OF pres
sure eatrey arising from the mere moral influence
of the the Bank Of had restored
s rate of the unusually low OF per
per The rule adopted by thu Bank OF Eogand is to
keep the little in advance Of the market in order
the market competitor with those large
banking houses who the actual business OF London
IL is the only institution which utters notes for circulation
within circle of sixty miles of London. The theory
il supply money the banking world around IT, When
charter renewed in its present form in 1884, its fac
uy OF issuing bills credt-that is 10 say, extent
beyond the of coin hand-was taken from il.
The theory which the charter based is that the
amount OF currency ought to fuctuato exactly accord
ing the impulse impaired by in its inhu
upon the precious metals-iha is say f the i'm.
ports had been such 10 cause commercial bal
ance, say Of 900 against the country that
would be exported. and ought TO be taken directly from
the currency in order that its departure might at
influence prices and the exchange Under the old
system, II El,OOOO00 came into the country, the bank
emitted $4,000 900 of currency and persa if Ell 0OO
600 il curaiied CO, 900, 600 Thus the huctua-
lions enormously greater than they would be under
simple specie currency. AT the time a ma rtnnuns
crcuiaion fixed for all other banks of issue Under
the system, 1t is evident that the OF interest
follow promptly the specie movement. The influx from
different last carried the bullion in bank
f22 600, and money Two per The export
has reduced it flsOOO.oOO and money is three poi
cent These fluctuations have by the
that they formerly had, when through the nteraced cred
its of the two countries the paper fabric carried
height which m AIDE cola pse the only alternative.
Strictly speaking, there is now no paper money in Eng
land. The aggregate crc ulaon OF the banks Is indeed
ESQ 900 900 but this does partske of the nature
of paper money ii exists in the United States In Eng
land there under 1925 each and every
ted represented by equal amount OF specie In the
bank vaults The bank has option IL must give notes
for gold gold for notes. according the demands of the
mi 20 MOI than de Nn npte ha
Issued until to the bank with piece oil
gold to exchange for it. initiation Of bank
therefore impossible in Engan In the United States on
the other hand paper initiation of very dangerous
acter is in rapid progress The public the danger and
strong efforts made resist it, In Massachusetts APP
plicatons Tor SOOO,OOO of bank capital being
and in all the western Sa,es-Ohio, Michigan, Illinois, In
diana, and Missourithe duplication of shnplaster
banks for the sole purpose of emitting small of 81
81 each to circulate money at discount OF per
teariuy rapid The mistaken notion that because the
nomnay secured by stocks they u safe
reney, the of the multiplication of laws in mi
tation OF that of the New York banking law. And the
quantity of afoai, working small chan
nes OF trade in the hands Of poor and small deal
before great The direct influence of
paper rags, circulating discount is drive metals
OF REGULATION and of the country Formerly il
avered that bank necessary because that the
sufficient gold in the world do business but
it will be remembered that in the years 1910 and Al when
the bank currency ofhe Union its lowest ebb specie
multiplied such that the Spanish and
fractions, that command three per premium ire
refused utterly by the banks and the post office and they
with difficulty passed all. The i'm poration OF gold
in those years also large 1928 900 900 arrived
1913 Since hsttime, bank paper has
and with the continued receipts of god paper has been
sued Of smaller denominations working the all
until in connexon with the temporary demand from Cali
iona and Australia caused by OF minis in those
localities, the scarcity is become intoerable As long
paper calculates money, the whole mixed OF
gold, silver and paper depocntes in the proportion
other commodities and prices rise, well of the
stocks which form the securities for paper
other articles As tho volume OF the currency becomes full
the metals leave until they become that the
the paper no longer possible Bankrupt
cies and fall in prices result. At such time bank
securities very insecure, If not vaueess protect the
bill holder That metal, which petition
with small notes. goes hrs-iha is 10 say, silver One
dollar do suppan $40 ngo but they drive out
Mexican and Spanish dollars and fve-franc pieces And
this bank expansion is one Of the efficient Of
the present scarcity of small coin, at when gold
supposed be essenng in value by OF
supply. Every effort is being made lessen the demand
for it Tor a currency, by suppantng 1t with paper
The coinage Philadelphia with the deposites and
ports gold Tor the months of the present year.
been fOllowsi