The Athens post. [volume] (Athens, Tenn.) 1848-1917, 1858-03-05
THE PLETHORA OF SPECIE, AND
WHERE 1T WILL LEAD.
From the New York Herald.l

PROM the New YORK heraldl
The city banks showed on Monday eve
ming nearly thirty-two millions of specie; an
increase Of over million on the week Prevl-
GUS, accompanied, singuar!o state, by re-
ducton in the loans and discounts. similar
abundance of specie is reported by the banks
of New Orleans. In London the Bank OF
England holds S75,OOO,OOO in specie, against
thirty last October. The Banks of France
and Prussia were never so rich 10 specie as
they are at present.
The history of the revulsion of last fall
rightly understood-explains this startling
and widespread phenomenon. We have pub.
lished statistical reports of the effect of the
rovulsion upon the commercial world of the
United States, carefully compiled by CONNER
eisl agencies; they 60 10 show that through
out the country not over two per cent of the
houses engaged in commerce found It neces-
sary 10 suspend or break last fall. Evident.
ly, this proportion bears no just relation to
the alarm and excitement created BY the re.
vusion; Il does not represent the amount of
damage done. Many houses lost money
which did not suspend; much business was
destroyed without absolutely breaking any
one. This damage must be taken into ac-
count in any reliable review of the effect of
the revulsion; we can guess at It's extent BY
comparing the present operations of the
Clearing House at this city with its opera
tons at the middle of last year. They show
decline of ohe.haf. The weekly totals are
one-haf what they were during the height
of the excitement in the early part of the
summer of 1857. II may therefore be as
suhied that the revulsion of last fall not only
broke two per cent of the mercantile houses
throughout the country, but destroyed fifty
per cent of the business done. II may like
wise be conjectured that the same figures
will answer for the foreign commercial world,
that while two per cent of the European
merchants broke during the crisis fifty per
cent Of the entire business done by the Euro.
pean mercantile world has since ceased to be
transacted.
II Is the money which was used in trans
acting this business, and which the desruc-
ton thereof necessarily liberated, which has
now found its way into the banks. II has
come out Of the pockets of the merchant, the
mechanic, the ship owner, the agriculturist,
the private banker and money lender. In
active commercial times all these classes are
constantly receiving and for time holding
quantities of specie; in time like the present
they have none, bills answering their purpose
quite as well as gold, and there being no
very promising employment for money; and
In such times, accordingly, coin flies to the
bank. II may be said in round numbers that
one.half the money with which the mercan-
tile business Of the commercial world is done
either is or is going to be stored in banks at
the great financial centres:-we add, "going
to be-" for the indications are that the banks
VIII hold this summer very considerable more
than they do now. At the present rate of
exchange, for instance, gold cannot be ship
ped probably to England; thus, the whole
drought from California will be retained here,
and the country will continue to forward its
surplus to the great centres until business
revives-that Is 10 say, til next fall at EARL.
est
1t Is no exaggeration to state that the eff
feet Of this accumulation OF specie at New
York, New Orleans, London, Paris, Frankfort,
&C., will be greater than was ever produced
by the discovery of gold in California and
Australia. The gold is not only added to the
basis for banking in greater Quantity than
those gold bearing countries ever produced
it; but it is here already, in bulk, with no risk
of transportation to undergo, no time to be
wasted in voyages, no ffliiering away of
large amounts in semiweekly driblets. If
California and Australia stimulated an in
crease of production, nm augmentation of en-
terprise, development of industry and a rise
in prices such as the world had never wit.
messed before, il is but logical and reasonable
to expect that the pending accumulation of
gold at the banking centres will In course of
time lead to similar results and occasion
similar changes. tt
Thus far the effect of .he plethora of specie
has been chiefly seen upon the stock market.
Since October last, when the city bank s sns.
pended, State and railway securities have
risen in market value some thirty per cent on
an average; and from the immense extent of
the daily operations it would appear that
there are many who do not consider the sum.
init by any means reached as yet. This in |
llation and activity of stocks is the effect of
the anxiety of capitalists TO get something to
do with their money. BY and by, these men
will have driven stocks so high that people
will be afraid to have anything TO do with
them, aud then the capitalists will turn their
attention to produce. cotton, &c. These will
share the impulse given to stocks, and will
impart il, on their side, 10 other branches of
trade, until at last the whole commerce and
industry Of the country will find itself surging
on the tide Of fresh initiation more unbound.
ed and more headlong ;han the last. That
this must be followed by n corresponding 70.