The New York herald., 1862-12-01
FINANCIAL AND COMMERCIAL.

i SUEpAv Nov. 20, 1861.
Congress meets tomorrow. and. though the
| Treasurv rcuort NAV not be forthcoming for day
or two, we may learn from the message tomos
row afternoon the leading features Of the future
financial nolicy OF government. II that policy
contemplstes further issue OF legal tender money
without previous attempt to negotiate loan. it
viii, he a confession Of weakness and Of want OF
confidence in the financial strength Of government
entirely without parallel in our history. The
several States Of the Union. with revenues barely
equal to their ordinary peace expenditures. bor-
| row money readily. and the public fight for
their bonds at premium. Railways, which
are not earning -four per cent on their
cost. and whose resources are small nego-
tiate loans. and their bonds sell at or over
par. Merchants engaged in perous mercan
tile adventures float their paper readily
at 4 5 per cent per annum. Yet it is pretended
in some quarters that the United States govern
mcnt, with a revenue which cannot fall short Of
$3.50 900 000 and which may exceed $3.50 900 ,0O0-
that is to say. revenue four to six times as great
as its average annual expenditure in time o.
peace-cannot appear in the market as Dor.
rover and negotiate loanl Currency, it is
urged by the opponents OF United States loan
is 30 scarce that new loan could not be paid for
And this nonsense passes current in Wall street
almost without question. Everybody knows that
Mr.. Chase has already added 5000 900 900 of
legal tender money 10 tile volume OF our cur
rcncy; that he has 800 O0C 600 more to be issued
that the banks OF New England. New York, Penn
sylvania, fNew Jersey aud Ohio have been ex-
panding their issues as fast as the printers could
supply the notes; and yet there are people who
kol ~ 10 af
| in the country to pay for government loaa. 1t
is to be hoped that, whatever the Secretary OF
| the Treasury may recommend. Congress will take
the pains to inform itself before acting upon the
! subject. It is quite true that when Mr.. Chase
called upon the banks to pay him twelve millions
OF dollars in legal tender currency within twenty
four hours they found il difficult to collect the
| qusite amount Of notes. But there was very cx-
cellent reason for this. There had been, and was
| stl, an active demand for legal tender notes at
| tho West to replace the broken down Western and
Southern wildcat paper, which had served as
money in that section and Mr.. Chase's legal
tender paper had gone thither as fast as it was
manufactured, whereas here there was no demand
! for it at all. Currency will always go where it is
wanted just as water will find its level. IT Mr..
Chase calls for loan to be paid for in legal tender
money, and it is well understood that it
will be awarded to the lowest. bidders,
without drawback. restriction or Limitation,
there need be no apprehension about
want of currency to pay for it. Currency
holders at the West cannot be expected to part
with their money unless they get its worth If Mr..
Chase gives out that he will not sell government
bonds below par it is. quite doubtful whether hold
ers of currency, which is convertible at any time
into United States bonds at par, will think it
worth their while to place that currency at his
disposal. 1t Is rather their interest to hold it and
await contingencies. But if they arc offered a
bond of the United States bearing six per cent in
terest. at a tempting price, they will very quickly
produce their legal tender money and take the
bond. Some people entertain the notion that 1t
is better to cause the price of food clothing,
merchandise and produce to advance so 100 per
cent than to sell United States bonds at
a discount. If Congress takes this view,
further issues Of paper will. Of course. be
authorized. Government bonds will advance,
and the expenditures of government and
the cost Of living will be at once increased from
30 to so per cent. The farmer who finds it hard
work to pay his store bill at the current prices
will then not be able to pay it at all. Dry goods.
groceries, farm utensils and every description Of
merchandise will advance materially. Govern
ment will pay 81 where it now pays 81 SO for
military supplies Soldiers wages will have to be
increased; for Sl3 a month will not procure ss
much as $40 now do. Mechanics, working for
government at the foundrics and navy yards, will
justly demand higher wages. Everything required
either by government or by the people will cost
more, and the expenses of the war--which Of
course must be ultimately paid in specie or its
equivalent--w be swelled so a SO per cent. Gold
will rise from l2s to $50 a l6O, and exchange from
I42 to IT'S a $50, and our currency will appear
to be proportonatcly deprecated. In return
for all this, we shall have the barren
satisfaction of seeing United States skies quoted at
a premium at the Board Of Brokers. IT. on the
other hand Congress should be wisely counselled
to test the public credit at this juncture, and
United States loan should be placed on the mar
ket the condition of affairs would be precisely re-
versed The cost OF living would fall at once.
Farmers would pay their store bills without diff.
Guilty, and keep something over for the taxgather.
err Dry goods, groceries and all kinds Of produce
and merchandise would fall to natural prices. Go.
vernnent would get for 81 that which now costs
81 So The cost OF the war would be materially
diminished. Gold and exchange would fall rapid
ly, and the national currency, which is the true
test Of national credit, would rise nearer to the
specie standard. The only drawback would
be that United States skies would probably
sell at a discount at the Brokers' Board
These arc the two alternatives between
which the Secretary Of the Treasury and