The Washington union. [volume] (City of Washington [D.C.]) 1857-1859, 1857-10-22

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and diminption Of the currency by the action OF the
banks, whether designed or not, the debtor in
terest suffers to the extent that property falls in
value, and the creditor interest profits in the
precise same ratio. The consequence is, that the
poor debtors made poorer and the rich creditors
made richer, whether those creditors are banks
landowners, merchants, others. This is not so
much the fault of the debtors or creditors of a
system which natural leads to such results whether
designed or not
In 1929 the United States Bank expanded its
issues, and other banks followed the example, and
paper currency became abundant In 1888 "a that
bank contracted, and portion of the others were
compelled to do the same money became scarce,
and property took a downward tendency, Distress
memorials were sent to Congress by the bushel, and
the friends of the bank claimed that all salaries of
officers Of the government should be largely cut
down, because money was so much more valuable
than formerly. In 1867 the bank changed its
course, and expanded most largely, and other banks
followed, and property to enormous prices. Pa
per money was most abundant, and the mass of peo
pie bought property running freely into debt. With
triaing but honorable exceptions, all the banks fail
ed early in 1881, when it took large amounts of prop
erty to pay small debts in real money. Debtors suf
fered and creditors profted by the state Of things
that followed. Creditors took from their debtors
substantially all they had and the bankrupt act fol-
lowed in lS4l to wipe out the balance, relieving
some honest debtors and dischargng many dishonest
ones from debts to which they should have applied
their concealed means to discharge in full. Our pa
psr-money system is responsible for these terrible
results aat.r s. lsI. $50. ,rsal s.la. N, slaas
At this very time the relations Of debtor and credi
tor producing their natural and ruinous results
Tens of thousands of debtors being compelled to
sell at such prices as creditors, or those having
money, are willing to give Although debtors are
bound to stand the consequences of mourning obliga
tons to pay money, and creditors entitled to
their lawful rights still debtors have fair right to
demand and insist that currency shall be stable
neither expanding nor contracting, because of its in
herent faultiness Our constitution made provision
for one that would remain comparatively uniform.
This the people have right to claim for the protec
ton of the debtors and the creditors have good
grounds to insist upon one which may operate more
for their benefit. On the other hand debtors have
no right to insist upon having one which will ex-
pand for their advantage. Stability in the currency
is most safe and best for all But instead of such
currency we now have made by those who are
accountable to no one for their acts and which is
now bringing injury, and often ruin, upon millions of
people And the great question is whether this ruin
system shall continue, shall give place to the
one contemplated by Washington, Adams, Madison,
Franklin, and Hamilton, and their associates, in
framing our constitution. w z7..s.
1t is not our wish to deprive merchants of any
reasonable and constitutional means of transactng
their business. A paper currency is not necessary
for that purpose. Without apparently knowing it,
they have in practical operation in New York among
banks substantially the old Amsterdam Bank well
true bank of deposite, though few seem to know
it. Although now only used by the banks, these
could be easily extended and multiplied, if necessa-
ry, 80 as to afford all the conveniences which COM
merce demands. In an interesting article upon the
clearing house in that city, the New York Herald
says: .,,..a. ...,. Oh, r......s., .. observation-disclosures.
1.-The associated banks, from time to time appoint
of their number to be depository to receive, In
special trust such coin any of the associated banks
may choose send to it flor safekeepng The deposit
tory issues certificates in exchange for such coin in prop
form and for convenient amounts. Such certificates
are negotiable only among the associated banks and
ceived by them in payment of balances at the clearing
house Such special dcposites of coin entirely voun
tary each bank being left perfectly free to make them
not its discretion The coin thus placed in spe
cal depose the absolute property of such of the
ciated banks as from time to time the holders Of the
certificates and held by the depository subject to with
dawa the presentation of the proper certificates at
any time during banking hours d stlq gs4 e..
The following shows how clearing house balances
are settled: sI
q" The credit banks, those whose exchanges have
been in their favor then commence at hafpast o'clock
to receive their differences in rotation occupying about
half an hour. Thus instead of chasing another
about the city all day. the banks that the others sim
ply pay the clearing house and the others to the clear
ing house and get It, Though the payments Of the clear
ing house nominaly in specie there is will be
by the constitution, Art is, smplifcaon by which
the cartng about Of ponderous bags of coin is avoided
The Bank of America is the depository of the other
banks and certificates issued by it representing the coin
special depote received and paid specie at the
clearing house "sa smassaI
These conveniences for facilitating bank exchanges
and settlements can be made equally useful to mer-
chants Instead of banks of issue, let them consti-
tute those of deposite the Bank of America is
for the other banks. If they wish banks of discount
where good short paper be converted into ready
money let them organize banks Of money where it
can be done There is no hazard or Inconvenience
about either except what arises from want of integ
xpb;cb mora likav tn occur hanks of ieaue