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

The question of loan of $50 900 600 or 800 OOO
600 Is now agtating financial circles Much doubt has
been expressed in some quarters the proproty of
the continued issue of tho small demand notes. The
ground of complaint is that although the issue of these
notes to the of $50 600 800 900 900 would
give business increased impetus raising the price of
all commodities and causing increased sales even at the
advanced price, yet the sudden imitation would be sure to
bring ruin on the country when at some future time;
collapse would take place The deprecated value OF paper
money Of tho time Of the American Revolution and the
financial panic of 1887 cited examples of the trou
bic attendant on the issue of paper money Az the time
Of the Revolution the born government issued bills
promising to pay certain future date The
population OF the country then small, its ro
sources undeyoloped, its wealth undiscovered The
nation had navy and but few merchant vessels There
was specie basis for the notes issued 1t WIS under
such circumstances that these bills made their appear
ance and of course their value was nothing.
Again, in 1887, the initiation due TO the issue Of such
quantities Of paper money without adequate specie
basis To this one may be traced all that was dis
astrous In the examples cited The Southern States now
in rebellion arc in exactly such q condition, financially
as were the colonies in the Revolution Their credit is
gone The notes thoy issue considered worthless by
their own employees Merchants and corporations issue
them without any prospect OF redemption In such a
way they propose to supply tho lack Of specie What
will DO the result Of their scheme may be seen
by studying tho history Of the examples referred
to- The croakers may apply their arguments the c. s.
A., but not to tho United States.
On the other hand the Northern States have had
so much specie since the commencement of this war
Tho rate Of exchange has been such this
country large amounts Of gold from foreign lands The
crops Of Europe have been poor those Of America good
Thus we have exported products (havng blockade
to prevent and in return received merchandise
specie This will not leave the country 10 any great
tent for tho expenditures Of tho government
entirely to domestic manufacturers and dealers Thus,
them there is sound basis for the government to ope-
rate Thei OF demand notes is warranted there
will be no collapse.
On an issue OF 500 900 900 the Treasury would save
u 800 OOO-no little sum. The people have been glad
welcome the notes, and will continue be So for by
their ISSUE instead of that Of bearing interest they
save taxation.
The statement that the government will not be able
redeem them when presented is no more worthy of
tce than would be the statement that will be able
to redeem the largo notes at the end of three years The
country Is probably well or financially at the present
moment as will then be, and the government well
able 10 redeem its obligations
We have shown that Mr.. Chase may safely continue 10
place in circulation the small notes Let him not be
frightened from thus benettng the people by the talk
and one sided arguments Of interested parties.