Nashville union and American. [volume] (Nashville, Tenn.) 1853-1862, 1858-10-23
Mr.. BeIl's Theory Of Currency.


which the President and those who sustsin his views
would seem to be ignorant, behind the age. From
the time Of Adam Smith, il has been admitted BY
writer's upon political economy, that bank notes,
OF paper circulation founded upon such securities
Sc insure their converibiity into gold and silver on
demand are Of equal value in all respects, 20 gold
and silver. a not less importsnt fact, which ap-
pears to be ignored by the President IS the superb
or advantages and convenience, in some respects,
Of paper currency, or circulation convertible into
gold or silver. sound paper circulation has not
only the advantage of cheapness and convenience,
as 3 medium Of exchange but, TO the extent that IL
takes the place Of the gold and silver that would
otherwise be required TO be kept in circulation in
any community or country as a medium Of exchange,
it adds to the floating OF unfxed capital Of the
country. The gold and silver dollar released or ex
PEELED from circulation by a paper dollar being no
longer required as medium Of exchange, in which
employment it could not increase, but, on the con
trary daily loses by abrasion, becomes part of the
active and productive capital Of the country, and
adds its due proportion Of increase 10 its wealth.
If therefore, the President, and those who sup
port bis policy, should succeed in putting down all
banks Of issue, and provide no other paper ciroula
ton Of equal value it be demonstrated that $780,,
600 900, at least, would be Withdrawn from the
present productive capital Of the country, without
any equivalent benefit.
As this speech has been extensively distributed
over the State and embodes doubtless, the leading
1QeAe luhb DC III the uhAe NdAhdoo W tuO
party Of which he is tie recognised head, such
declaration as the foregoing is worthy of special
note as illustrating the Federal egOtism of the
thor the singular fallacy that characterises all bank
logic, and TIE dangerous tendency of such policy
in this respect, as gentlemen Of Mr.. BELLS school
would force upon the country.
The propositions of the foregoing extract are set
forth with self-importance and an arrogance Of
style peculiarly the authors own; snd yet, from
the first letter Of the opening sentence 10 the
last lie ter Of the concluding sentence is tissue
of bungliDg ridiculous assumption, untrue in fact
and untrue in theory.
For instance, we are first told that the President
and those who sustain his views on the subjects of
trade and currency, "seem ignorant or behind the
age" and this remark is based upon that portion of
the Presidents message which declares 1t ssppsrent
that our existing misfortunes hayeprOceeded solely
from eur exravagsn and vicious system Of paper cur
rency and bank credits exciting the people wild
specuations and gambling in stocks Where was
the ignorance displayed in such declaration Did
not the statistics of the country show unusually
inflated oonditi1 IN Of the currency? Did not the
fact Of the inability of the Banks in nearly every
locality, to meet the legitimate demands against
them the suspension of all aud the utter failure of
many clearly attest TO the world the truth of the dec
laration the President had made? For, that such
8 period Of devastation should occur at time when
the nation was at peace, when there was no reason
for extraordinary expenditures, public or private.
when every branch of productive industry was in a
state Of wholesome activity and California furnish
ing her annual harvest of gold only be explain
:. 4. a., n, 80. HI q
own creation. Facts so apparent and conclusions
50 inevitable, leave the charge Of ignorance or viii
full reoklessness ct Mr.. Bells own door.
Mr.. BELL sets out by assuming fact at the basis
Of his argument which, unfortunately for his con-
illusions, never exised-that is, that "a paper cir-
culation founded upon such securities iss their
eOnUsrtJility into gold and sUsT on demand, are Of
equal value in all respects TO gold and silver.
Without stopping debate the proposition We deny
the fact that there ever was in the history Of bank
ing paper currency" founded upon any such Sc
curies; and TO bear US out have only to refer to
the history Of banks Of issue from their inception
to the present time. Of the thousands Of banks
which such statesmen as Mr.. BELL have imposed
upon the country, how many of them in their time
have failed or suspended leaving rotten and depre
GldleQ IN the hdAus VI Tue P6bPLGg "-A~-'
if convertible at ALL was only convertible at their
pleasure? VIII Mr. BELL or his friends point them
out? Have not their very best banks" as they are
sometimes termed, CHE Bank of Tennessee, for in
stance been the first to suspend and the last to re
sumo Why did not Mr. BELL by way Of gthen-
ing his argument, point to an instance Of paper
circulation founded upon such securities as insured
its eoRvertbiity into gold and silver" at all times!
But these are minor points in Mr.. BELLS theory
on currency, in comparison with his next master
stroke, in which the grand discovery is made-Of
which he may well suppose the President and those
who sustain his views were iguOraut-that d" to the
extent paper money takes the place Of the gold and
silver, shat would otherwise be required to be kept
in circulation in any community or country as me-
dium Of exchange it adds 10 the floating or unfxed
capital of the country The gold and silver dollar
released or expelled from circulation by paper dol
lar, being 10 longer required as a medium of ex-
change, becomes part of the active and productive
capital Of the country, and adds its due proportion
of increase to its wealth" StupeuduOus argument,
indeed Wonderful discovery Let US simplify it
for more easy comprehension, as follows: Real
money, that is gold and silver, is thing Of value,
as much so as corn, wheat, any other commodity,
and constitutes part Of the actual wealth of the
country. Being most useful as a medium of ex-
change it is generally used in that way. Paper is
thing of comparatively no value, and the labor re-
quired to produce gold dollar would produce
thousand paper ones Nov, says Mr. BELL, to sub
stitute the paper for the gold and silver andle that
occupy some other relation in the channels Of trade
would be adding just that much more to the pro
ductive capital Of % c-auJry and to the
increase Of its weakly & this be 10 Il is
sad waste q the pro capital ali wealth
Of . country 90 caa u OF use any thing |
ss g medium Of sEcla.kt ,val1fble than paper. |
It was q foolish t.uz, she Trainers Of our
constitution TO declare e. li1c should be made .
a legal tender but gold co.. r But Mr. BELL's
theory is too failacicus taH fscIous argument.
The simplest mind can sss ten thousand dol
lars Of real money is Wa from circulation
to day, and that much p Iaary printed and
thrown out in its stead thu real vsalth Of the
community has not been ira. .rI, Che paper or
sham money being valuelcai Sept s1 Jar as IL is
sustained, dollar for dollar by 10 .ToN money with>
drawn; and that just to the rslent the real money
is applied to another purpose And ceases 90 be the
basis Of the sham money, the latter becomes spu-
riOus circulation, fraud upon the public. Mr..
BEIL's theory upon currency has been very fully
and efectusy tested in Tennessee Of late, and need
we state the result? Every has practical