, 1862-01-01
Gi)t Tribtt1te.
>CSPEccttt'I0N Gz' SPECIE p.v,
WENT,ss'-~-A FAIR WARNING.

Tic banks Of the city Of New lc;,s must
uEfcesl'onably be followed by The adop-
hon OF like measure By al the banks Of
Tie country-those Of Illinois, Iowa, Indi-
ana, Wisconsin, Ohio and Missouri inclu-
ded. They would hare no option were
They inclined to maintain tlcir credit and
solEency. Where, as in this case, press
ing necessity accofds with their inclination
and their greed for profits, they will gladly
avail themselves Of the example that New
York has set; and before this article goes
to press. the telegraph VIII bring Us news
that the heaven Of rag-money makers has
been reaclsed-thas condition Of affairs in
which they may always pay out and never
hc called upon to redeem. The people
who will be plucked and feeced by this
latest maneuver, for which, by the way,
there seems to be no sufficient warrant,
cither in The condition Of the country or in
the low state Of what, with cutting financial
irony arc called "spccie reserves will not
he so we'll satisfied. 1t is theirs to bear the
muluform losses and Inconvenience which
this disastrous suspension will entail; and
though thousands Of debtors will find re-
Lief IN the new order Of things which the
shin plaster era will bring in its train, the
final result will he the rapid, and, we
fear, the ruinous impovcrishment of the
country st large. There will be signs Of
prosperity, as iuscTy and unreal as the
hectic flush on the check Of the consump-
tirc patient; the banks, not having the
necessity Of specie redemption before them,
will pour out any sun, short Of six hundred
millions Of their promises -to-pay; this rapid
and enormous increase Of the volume Of
the circulating medium will quicken com
mcrcc, temporarily stimulate industry, in
crease prices, enlarge profits; our importa-
tions OF credit will rapidly expand, and the
gold In the country will flow out to pay the
foreign debt that we shall pile up for that
Which we do not need; expectations Of
grain, III consequence Of the increased cost
Of labor in its production, will fill of; as,
With the currency that Te shall have, no
farmer can raise wheat here for
the prices which it will command
in Liverpool, where gold is the stand
ard; tie prospective good effect of
cur new tariff Will lie ncutralizcd by the
causes which still cut off from our c1porta-
tons Of farm produce, because when labor
in New England and at the iron mills Of
Pennsylvania is obtained only at cost
three or four times as great as that for the
same in Manchester or Wales, any moder-
atc thrift will cease to be protection to
home industry; and the end of al will
be universal and all absorbing bankruptcy.
compared with which that Of 1887, '57 and
81 will seem to be only temporary embar-
rassnlcnts. These arc bold predictions: and
nothing but an instant, imperative and
stringent law Of Congress, which shall tax
bank paper in such a way that the issues
thereof shall be kept within their present
limits, will prevent us from establishing
character as prophets, and save us from the
disasters Of which this suspension Of specie
payments is only the forerunner.
Ne have no need to argue out these gen
eral propositions and prorethem as prob
lem III mathematics; because the expert
cnccs Of England, at time when all her
resources were taxed in war as ours are
to-day, have furnished us with precedent
which makes arguncn.a work Of srnerero-
CATION. The Bank Of England suspended in
1887, wien it had ii circulation its bills to
the amount Of So ,674 $50; and at the close
Of the war, il 1916, this sun had been III
creased to G27,274,67o, or s13G, 100000.
When the suspension took place, there
were in the United Kingdom two hundred
ether banks with an unknown circulation;
increased by natural process Of vegetation,
as all noxious weeds grow, to ui;se hundred
and jurty, with 3 circulation enormously
inflated. Paper money was the favoritc
speculation Of the speculative classcs Bank
stock was the \ No. !, Investment That
OF the Bank Of England Increased
one hundred per cent in value in the share
market "All,' = says distinguished writer
on finance, speaking Of tllis period, :'who
"dcelt in money, capitalists, bankers, stock
"jobbers and SPECTATORS, and al merchants
"and traders were put in aposition in which
"proft and the appearance Of wealth flow
"cd in upon tlem,' delusiyc prosperity
seemed indeed TO visit all classes save one
no branch Of industry escaped the ctEect
produced by this plethora Of the currency
enormous profits were made on government
contracts and government loans; but while
everything else was stimulated by thu
floods Of paper money, which the banks
all over tie kingdom, poured cut, the ris<
in the rr1ce Of labor, though whcat wen
up from forty shillings, to an average, fo1
seven years, Of ninety-1ive slhillings qna7
lei, Gid not keep pace with the increased
cost Of living; and, as . consequence, mon
ey accumulated in masses in th'
hands Of the acute and wary few, while tn
many were Impoverished. The small
landholdcrs aud the class Of Englisllmc1
AIQN Ii dS CDtt<.3C1S llt4S "a St!ll4i lIpE
hol1s-W ere wiped on, and :llcir substance
went to the Golfers Of the rich. But these
though sufficient to breed discomfort in
whole nation, were triding evils compare;
with those which were endured when th
attempt was made to bring this ruinou
system Of currency expansion to an end
at tue incoming Of peace In 1916 til,
loans Of the Bank Of England were re
duccd from tventy-t1lree millions to eigh
millions pounds sterling; and then cam
tile crash. The banks that had ncen lit
tered with such fecundity toppled down
the fortunes that had been heaped up i
tic day when money (parcr} was plenty an
cheap, went By The board; debtors failed
discharge their obligations; foreign con-
mcrce, it was found, had swept the countr
Of 8 large share Of its gold, q large majorit
Of thc merchants Of the kingdom went int
bankruptcy, md the ruin and distress fo
lowed wherever the flood Of paper none
had been. And it was not until 1927, tht
the commercial disorders and the fnauci:
wrecks, caused by this condition Of affair