Washington sentinel. [volume] (City of Washington [D.C.]) 1853-1856, 1855-05-19

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War is condition stimulant, and while il
contracts the sphere Of many branches of bust
ness, and nearly suppresses others, il throws out
greatly extended circulation Of money or its
representatives, ~ II lA4sfsi8
England, France, and Russia, are now throw
ing out among their people an increased national
circulation, in the aggregate, of not less than
three hundred TO FIVE hundred millions of dollars
annually. sf
The effect of this addition to the currency is to
stimulate all profitable business to their utmost
tension; TO engender and give life to new opera
tons promising profit in those countries.
The first and most natural are those branches
OF trade which minister directly to the war, and
which can be supplied by the respective nations
themselves as cheap as they can be had else
where; and, secondly, such new operations as
those to which the war may give arise q {.
In order to Judge how this will affect the United
States, it would be necessary to determine in
what and to what extent these countries can sup
ply themselves as cheaply as can the United
States supply them; and whether the war affords
any new opening for capital to the people Of
those countries, and to what extent
1t would also be necessary to know what
branches of trade there, with plethora of money,
could be proftably extended
Upon all and each Of these points only an APP
proximate estimate can be formed from any in
formation accessible. Without venturing into the
computation by specific figures, we can yet, in
general terms, state the natural results.
We can state, with much assurance Of its ac-
curacy, that the falling off in the demand for
iron for ordinary commercial purposes, is not less
than the demand for this article, to which the war
further demand for capital in this branch Of
trade.
We can further say, with safety, that the Rus
sian demand for goods must greatly fall off, and
probably Austria and Turkey will take less than
usual; most probably England and France will
take less of each other than during peace. The
United States, a largest-class customer, has
diminished her demands for the commodities of
these countries to the extent of many millions
We are, therefore, well assured that many
branches of trade, SO far from being able TO ex-
pand, are obliged, regardless Of the abundance
of money, TO curtail their business. The course
of trade, which is well known, clearly shows
that very many branches of trade cannot expand,
and therefore will not need money
In those branches Of trade which have received
powerful stimuant from the war, the demand
has, to very considerable extent, been supplied
by the United States. Our commercial marine
is reapng rich harvest in the employ of the bel
ligerents. The commercial operations of this
country have been most extensively curiailed.
England and France cannot profitably employ
the enormous circulation created by the war, and
will not call on u.s.
The supplies of gold from California, and the
general contraction which has been going on, to-
gether with the above influences, would seem to
indicate an inevitable decline in the rate Of
money, until the numerous suspended and pro-
jected, but not begun, operations shall begin To
absorb dormant capital
liz our views be correct, the summer cannot
pass without general rise in the market through
out the Union.
Already the eastern cities feel the relief Of idle
money accommodating there. Money in Boston,
New York, Philadelphia, and Baltimore, may be
quoted at TO per cent. But this ease has not
yet reached the south and west. In this city, for
instance, among bankers, not our banks,
having occasion TO ask what terms they were
dscounting satisfactory paper, we were informed
the rate was two per cent. per month This may
not be the precise rate Of all for every piece OF
paper; but the rates here are, out Of bank, inor-
dinately higher than at the cities above men
toned 10 it is in Virginia, the circulation Of
whose banks has been diminished, as we learn,
some two millions OF dollars. In California the
rate is three per cent per month. But the
causes we have adduccd will bring ease TO the
market.
'frhc more the belligerent nations borrow, the
greater will be the circulating medium, while
many branches OF trade must continue 10 contract
in spite Of an Astounding money market.
There is danger Of our being tempted, within
two years, 10 indulge in expanded and hazardous
undertakings.
We have thrown out these desultory remarks
somewhat with the expectation that they might
induce some one having more full and accurate
data, TO make some more near estimate Of the
effect of the immense circulation being created
by the bellgerents.
There is one contingency, and only one, which
can threaten a scarcity Of money, and that is,
that the operations in the East may cause de-
mand for specie there. Should there be no occa-
sion for apprehension this point, then the fact
that there must be superabundance of money
stands palpable.
vIRGINIA-AND ESPECIALLY THE
METROPOLITAN DISTRICT.
IL - Il. H.. 4