Nashville union and American. [volume] (Nashville, Tenn.) 1853-1862, 1857-10-27

have proved; and, therefore, our position thai mix
ed-currency banks are not reliable we believe estab
lshed. We do not suppose that the more-rehecting
and far-seeing have any doubts on this subject
Such have long felt the evils Of which we spsak.-
But the masses Of the people hsve no suspicion Of
the very deusiTe character Of The currency they
daily use. They have become 50 accustomed to
periodical commissions to regard them as inevitable
and even necessarily incident 10 normal condition
of currency and trade.
". a mized currency has constant tendency to
drlUe tie UalHe money out Of The ccuntry.
The reason is obvious. The precious metals fol-
low the laws Of value in the same as every
other commodity. They 60 where they have the
greatest power in exchange. If this country they
have, as currency, in fact but one third of their
actual value owing to the introduction of credit
money into the circulation they viii CO. in oOedence
to the immutakle laws of trade, other countries
where they command their full value Wherever
mixed currency exists the value money, specie, is,
has no more power in exchange than the credit mo-
ney; they both together form the currency, and one
viii purchase just as much Of any kind Of property
as the other Now, then, if there be any country
with which the United States Trades which uses
specie money only, or currency less diluted than
our own, our specie will inevitably flow off to that
country. With freedom Of exchange, every com
modify viii find that market where has the highest
power in exchange. Theu, five have, ymeans Of a
mixed currency, reduced dollar to the power OF
333 cents here is generally the fact the tendency
viii be to expel it. On the other hand, if our cur
rency were altogether value money, specie would
have no more tendency to flow out than to now IN.
Observe, in this connection, striking fact. The
specie in all the banks in l84S was 46,OOO,OO0; in
1856 it go 00O 600; increase in eight years, ID,
100000 only-while, in that time, we had produced
in California 300,000,000 of gold, thus show
ing that Of al that amount not twentieth part has
been retained in the country as G. basis for our pa
per money currency. Indeed it is one Of the pOpu-
I'D ~.
does expe specie and furnishes cheaper and there
fore desirable article in its stead. Now We DO
not say that if we had none but specie money banks
all the gold of California would remain in this
/ try a circulating medium. Quite OTHERWISE
Gold is now one Of the productions of the United
| States as much as cotton or wheat and like them,
/ in q normal condition Of the currency, would be ex
ported the principle, viz because foreigners
/ needed it more than we did. What do say is,
that by our present system drive out that proper
ton Of our annual product which is legitmaely re-
quired, and would otherwise remain with us as cur
| reney.
vi 4 mind currency coHatracts the influence Of pro-
teetiUe dUis and retards the natural grOS0h Of
faetures.
This wewill enGeavor to show by an illustration
/ Suppose that certain kind of broadcloth can be
afforded by the foreign manufacturer, delivered at
New York. for two dollars per yard the same article
might be made In this country, but would cost two
dollars yard, without any prOdtwhateyer Oicourse
/ then, We cannot afford to make the article The
government, In order TO encourage Its production
Bere, lays du;y upon the imported article OF fifty
cents per yard bat at the same time banks
which manufacture mixed currency, and double or
treble the natural amount Of money. The American
manufacturer now proceeds to erect his mills, but
wages and materials have advanced in price, by
the expansion Of the currency that costs him 20 TO
80 per cent than it otherwise would have done
He builds machinery, but this also costs him proper
tiOnaly high. HeprOceedsIO purchaseraw materials,
aud employ labor IN manufacturing, but all are al
Yanced IN price, for the same reason. His own ex-
penses for living are also higher; and should he be
obliged to hire money that must also have advanced
in price, rate Of interest. Under these circum-
stances, he cannot make the cloth as TO afford
profit, and it will be surprising If he shOnld
clamor for more protection But it may be said that
the same causes that have advanced The expenses of
living and consequently, Of labor, viii equally have
advanced the price of broadcoth. Not The
price OF the br0adcloth will be determined by the
at which it be afforded by the foreign manu-
acturer, and if he ay the duty Of fifty cents per
yard, and yet obtain fair profit his goods, he will
send all the market demanUs
There is another view of the matter. Suppose we
would export plain eCttons, for example, to
India. We there meet the Eagush article made
der a currency two or three times valuable as our
own, which can consequently be afforded for less,
since with the amount Of the money Of India,
z
pay for much more labor in England than the Ameri
can manufacturer can in America. IL is true that
the rate Of 0ages is lower in England than in this
country; out, aIHj0H 10 this Eng aud has the very
great Advantage OF a currency nearer the currency
uI International exchange, which is always strictly
UaEue moHey. In such a state of things, not all the
tariffs tn ever were or ever viii be imposed
Adequately protect inutacJures SO lar as they
have arisen or tOurished, IL has been in spite Of
these disadvantages.
The government has held out promises by its pro-
tective duties, while banks have been pursuing
system which has been continually ,eountervaIlIng
those uuues, and rendering the manufacturing
business ne Of great uncertainty and perplexity.
VII Fndtiy implying GHd crealtag all these evils,
H,aIsd currency is not a self regulated currency.
We lay down these propositions:
LIST. That a Uatae currency regulates itself by the
expectation importation Of ToAty, in accordance
with the laws Of supply and demand, and also by the
adaptation Of the precious metals to other uses, las
for ornaments, plate, etc, and thus preserves the
integrity Of prices, by preserving its own proper
proportion to the wants Of commerce
"a. The Introduction OF credit money deTanges
the effect Of every law Of value upon a currency. Not
possessing full, absolute value but partial and
fictitious one, is governed by the laws OF value
Where mixed currency exists, the substitution Of
credit for value money, Is unrestricted by any laws
whatever specie flows out, and cannot H. though
there be great rant Off, the credit money part OF
Tue currency, as IL uOes not increase Dy Jle natural
operation Of the law Of demand, cannot be diminish
ed by the law Of supply; there being demand for
il abroad il viii not be thus diminished, and it can
not, from its nature be converted into any than
that Of currency; consequently
Sd. All expansions OF mixed currency, as they
not restricted by cost Of production, las is the
case with specie,) they dependent upon the
viii OF thousands OF Bank directors acting without
cJncert and IN competition, Will not be limited by
laws OF value, AMI will therefore, beuunaturala
exaggerated: all cOntraeIons, being reactions, often
increased by panic aud unrtstraiuedby any general
system Of conservative measures. will be harsh, vjo
lent and ruinOus.