The New York herald. [volume] (New York [N.Y.]) 1840-1920, 1862-08-04
Since January !. .saI ,ela,e50 e,s2i,70o 1884 o.

showed specie average of 1913 ,0G4 $780, being an
| increase of 81 ,l37966 from the previous week;
deposits average Of 1892 l7s, being increase
of 1884 ,20l; loans average of $40, 76s 1903,
| being an increase Of $049,S70. 1t is understood
that the deposits, specie and loans will all show
further increase tomorrow. Money is accumu-
latng rapidly at this financial centre, and the
banks sadly puzzled to find lucrative employ
ment for their means. large portion of the
specie reserve consists Of special deposits
bly, some eight millions. As general rule the bank
managers continue, as heretofore, hearty sup
porters Of the financial policy Of the government.
There are, however, some exceptions to this rule.
1t is understood in the street that some Of the
most malicious and unreasonable attacks upon Mr..
Chase's policy which have lately been ventilated
through the public press have been inspired in
banking circles. The Clearing House Association
negects its duty if it allows the public finances to
be assailed and the bank assets to be impaired in
value by members Of the association OF persons
under their control. The financial policy Of the
government is fixed, and, be it sound or unsounl,
cannot now be changed To attack it, and predict
its failure, s to work in the direct interest Of the
rebellion.
Money was easy all last week. especially to-
wards the close. The authorized quotations
yesterday were a per cent for call loans; as
6 for prime mercantile paper, according to date;
SO for government certificates of Indebtedness
one year to run The Sub-Treasury received last
week nearly half million on deposit on call, after
ten days, at per cent. Money is evidently be-
coming more abundant and easier; and but for the
Willingness of government to allow per cent for
deposits, it would be fair to expect two to three
per cent money market this month. Financiers
are beginning TO question the wisdom Of the gov
crnment deposit system 1t is said that, by allow
Ing per cent for deposits on call, Mr. Chase is
standing in his own light, and impeding the natural
| advance OF his six per cent stock. So long as
capitalists can get four per cent CALL the temp
tation to give par for six per cent stock is slight
1t is argued that if the rate allowed by govern
ment for deposits was reduced to 21I per cent,
| the public would naturally invest their money in
| the funded securities of the United States, and
| hence that the fve-twenty bonds would soon
| be placed at a price which would induce
active conversions of currency. We cannot
| help thinking that the deposit system
has achieved its purpose and fulfilled its
object. At very serious crisis in our
financial history it supplied the government with
| funds when no other resource was available.
Whether it presents any present advantages which
counterbalance ITS obvious dement's is at least
l d
dangerous expedient. II is simple and tempting
financial method; but every Wall street operator
| knows that demand loans are invariably called in
just at the moment when it is most inconvcnient to
| pay them. We are inclined TO think that steady
adherence to the convertible paper money system
will work more satisfactorily for tho government,
and in the main, more benefciaIly to the public,
than any other plan which has been or can be de-
| vised.
The gold and exchange markets were active all
last week. Gold sold as high as H. and as low as
ia; it closed yesterday at about ll5 "A. Elk.
/ change sold as high l29, and as low as l251a
| it closed yesterday at 1859. 1867. An impress.
sion prevails that the backbone Of the speculation
| in gold is broken. IL is evident that the export
demand cannot be relied on to keep up the price.
| We are already exporting as much as we import,
and in the course Of few weeks our exports will
| probably be SO largely in excess OF our imports
that we shall not only cease TO export coin, but
| shall begin to receive gold from Europe. Hoard
ing still continues to ssme extent; but every day
| certain number OF persons discover that the loss
of interest more than counterbalances any reason
| able prospect Of profit through an advance in the
rpYemium on coin; and, simultaneously, others are
ecovering from the panic which induced them to
hoard Notwithstanding these adverse elements
however, there is sufficient vitality remaining in
the specie speculation TO keep the price Of gold
active at a figure considerably higher than IL
| ought to command. Efforts have been made
in various quarters to throw obstacles in the way
4 Of speculative purchases OF coin. The Board of
i Brokers has passed q resolution declaring that
/ it will not take cognizancc Of time contracts
| in gold But the banks continue to foster spe.
| culation in the precious metal by lending on
gold at the lowest rates Of interest. The wisdom
Of this policy may well be questioned. 1t is clear
that each advance in the premium on gold amounts
indirectly to q depreciation--to O corresponding
extcnt-in the bills receivable Of mercantile
| houses. The interest of the commercial commu.
nifty and Of The public at large is obviously sppos-
ed to rise in gold. The higher it rises, the more
merchants lose; the nearer II falls to par the bet.
ter their prospect Of doing sound and lucrative
business. These principles being so clear as to
command universal assent, il has been matter Of
some surprise that the stockholders in the leading
city banks--who are the parties most directly con-
cerncd-havc not already intericred to preven the
encouragement by the banks Of further specula
ton in gold. X would be very easy to put an end
to it IL the leading banks would agree not to lend
on specie. Very few persons would operate for
the rise IL they had to carry their gold. II is the
case with which large sums can be carried on
small margins, with the aid Of the banks, which
encourages spectators to buy for the rise. Let
the Clearing House adopt q resolution that no
more money shall be lent on gold, and that any
bank violating the rule shall DO excluded
from the association, and coin will soon
fan to it's natural level. Private bankers
will find it to their interest TO follow the
example Of the Associated Banks. None Of them
will care TO be singled ont az enemies Of the ma.
'',nI currency o. ths pyssspt eJbis, p!sl0val as