The Athens post. [volume] (Athens, Tenn.) 1848-1917, 1858-01-08
RANKRUPTCY OF THE NATIONS.

BANKRUPTCY OF THE NATIONS.
The nature and consequences of a fictitious
circulating medium, Of currency based on
Indebtedness instead Of property, and consist
ing Of promises to pay instead of the val ia
bic consideration itself, is every day becoming
better understood. The manner in when the
nations have been doing business heretofore
and the disastrous results that musI Soo"e'
ar later follow, are forcibly presented IN
the following article-frOm the New iofk
Sun:
There is not nation in ChrIslendom can
nav ia debts in full. Nationality lhe Oh'ied
States are not heavily in debt; bul as people,
!. States and communities, our debts are I'M
meose. The general government owes COIN
,.r,tiyely little, and the national property is
,vorth many times all the republic owes; but
there il not enough gold coin on the Western
sontinsnt TO pay the debts of individuals, OF
atty and other corporations, and Of the several
St.tes Il would take large share Of the
specie in the vaults Of our city Banks TO pay
the debts of ou- city corporation, and all the
gold in the State would scarcely pay the
State debt. Were we, then, called on to pay
our debts in specie, we should be obliged to
make confession Of general bankruptcy. We
contracted these debts under an inflated state
Of the currency, and we can never pay them
In .hsrd coin"
The case Of other nations is similar. Eng
land IL oppressed with national debt which
she can never pay. France, Austria, and all
the German States, are in the same category.
They are all so deeply involved in debt, that
they must sooner or later repudiaie. or sink
under the load. The whole system of finance
in Europe and in this country il artificial and
unsound. Debts are made TO represent
wealth. since the consols and coupons-the
stock and evidences OF public debt-are
bought, exchanged, and deposited a. the rep
r,sentatiyrs of value, when, in fact, they have
no intrinsic OF fixed value, aud may, rnder
certain circumstances, become utterly value
less As securities.
The State of New York, for instance, owes
some twenty-five millions of dollars; and
it has issued promises to pay to an equal
amount. These promises are bought and
sold as property, and as representatives of
value, but their value fuctuates according to
the state Of the money market. When money
10 plenty, or rather, when the demand for II is
limited, State stocks command a premium,
because they bear interest, aud the State is
supposed to be a good debtor; hut when
money is scarce, or the demand for it is large,
State stocks will not sell at par, because the
interest which they pay bears but a small
proportion to the interest which individuals
will pay for the use of the money invested in
them.
Thus, the business man who, in prosper
Gus times, invests his profits in the purchase
of State stocks, bearing six per cent interest,
will, when the times become adverse, and he
10 obliged to pay two and three per cent.
month Tor the use of money, sell his stock
readily below par, rather than 60 into the
street to borrow at exOrbitant rates Of inter-
est. And when all want money and few want
stock securities, all kinds of certificates Of in
debtrdness must decline in price. 1t will be
seen, therefore, that financial system which
employs the evidences of our public indebt-
sdness, rs if they constituted wealth of
fixed and permanent character, is exposed to
many and frequent disturbing Influences
And when we ndd to these the evidences OF
our railroad and other debts, which are still
more sensitive to the varying conditions of
the financial world, we have constructed n
composite system of finance, which the first
violent shock to credit will break in pieces
II does seem rs If the commercial nations OF
the world will yet be obliged to 60 into gen
erSl bankruptcy, and reconstruct their finan-
cial systems on simpler and sounder basis.