The New York herald. [volume] (New York [N.Y.]) 1840-1920, 1861-09-30

Of the 7S0 notes. and that if the former fell to or
or per cent discount they would constitute a
formidable rival to the notes which it Is now the
chief interest of the Secretary to SELL Thi2 no;ut
must be borne in mind in considering tb' present
issue between the Secretary and the b ,nks Il ia
understood that the former declares that he needs
the whole Of his next fifty mllio, g in money and
thai he cannot afford to recei' q anv mart Of il in
Treasury notes. Now if = No hanks accent this
condition the 6 per cent notes will probably de.
cline to q point which will render them better
purchase than the 7 eo notes and on tho other
hand, vacllaton md uncertan,y will, be deva,opsd
NJ une nnanoi"'. policy of the government which
W.. o' Pio' active of injurious effects abroad and
y. none' Probably the best way Of solving the
a'ao" ~ would be for the Secretary to continue to
fec sve the per cent notes, heretofore, in pay
Ient for the 730 per cent notes. and to supply any
deficit which might thus be caused by the issue of
United States notes payable on demand.
This leads us to the second point at issue. We
have already alluded to the views OF certain of our
bankers, who object to tie issue Of these United
States notes by government on the ground that
they will displace the paper currency OF the banks,
and that they cannot he redeemed if presented for
payment The unsoundness Of these views is
| manifest, and has been frequently demonstrated.
II would be decided public gain if three-fouIths
| OF the sl500000 900 of bank note currency now
| aioat in the loyal States could be driven out of
circulation and replaced by United States notes,
| secured, not by deposits Of fuctuating stocks or
mortgages OF uncertain value, but by the pledge of
the faith and credit and the entire resources OF the
United States government. q or NJ ed there be any
| fears entertained about the redemption of these
notes. Every one knows that il all the bank notes
| now current in the North were sent home for
| redemption in specie they could not be redeemed
aud the banks would all break. They are
! not sent home for redemption because the
public have confidence in their intrinsic
value. That confidence rests upon the fact that
they are secured by the pledge of the United
States and State stocks. Surely the same conf
dence viii be reposed in the direct obligations of
the United States government az is row felt in
bank notes secured by the deposit of these obliga
tons. TO say that the pubc viii not have the
same faith in United States notes, payable on de-
mand, as they have in bank notes secured by the
deposit of United States stocks is like saying that
certificate receipt for bullion is better than the
gold itself, or q warehouse receipt more valuable
than the goods thems lives. But the public il
promptly disposing Of the falacies of the oppo-
nents OF the United States notes. Peopie are
everywhere begging for them, and no one is pre-
seniing them for redemption. If Mr.. Chase had
not been so niggard Of them they would have al.
ready been in general use in this part Ct the cour-
try and in the West The sooner Mr.. Chase ex-
hausts The power conferred upon him by tie act
of last session in regard to the issue of United
States notes. the better the people will be pleased.
sach an issue again presents the only practical
remedy for another difficulty which has arisen.
Under the terms Of the negotiation of August 10.
the last instrument of the fret $50 Goa 900 loan will
not be payable till October 10, and no part of the
second $50 ,0OO, GOO will be available for The wants
OF the Secretary till after that date. Now, we un-
derstand that Mr.. Chase requires, before October
Is, not only the remaining SIT 900, 900 due on the
FIRST $50 900 900 loan, but about as much msre on
account of the second fifty millions 1t might EN-.
barrass the banks very seriously to pay thirty four
five millions into the Sub Treasury in the course
of fortnight, especially as the secrotarys drafts
are SO slow in coming to hand for payment.
and the gnld remains so long locked up in
lie Sub-IreasuIy. IT, however the Secretary
should issue fifteen or twenty millions of United
States notes, it is probable that he would not need
to coll upon the banks for more money than thew
into general circulation in tie Western States
where the want Of q currency is severely felt. and
The banks would be prepared to commence their
payments on account Of the second fifty millions
it'll about as much bullion as they had six weeks
ego.
4 sIi'' difference Of opinion has arisen in regard
TO the intent OF the recent act of Congress relating
TO the sub-Treasury. When that act was passed it
vas believed here that it amounted in fact to the
abolition of the Sub Treasury for the time being.
AID that hencetorth, or during the war, the
government would keep its account with such
solvent banks as lent it money. This was
the belief Of many OF oW leading bankers OF the
time the sl50000000 loan was negotiated on the
10th ult. In effect however, there has been no
change in the system. The Sub-Treasury balance
has swelled from 100000 to $l3 GOO goo in the
course of six weeks, at the expense of the banks.
DIR. Chase draws, as heretofore upon the Sub.
Treasurer, and not on the banks. His drafts do
not constitute, as was expected, o part of the
banking currency Of the North, but actually ope.
rate antagonisticay to the banks. 1t is argued