The Portland daily press., 1863-11-07
Financial.

One Of the most surprising facts developed
by the war, is the capacity of the free States
for absorbing the Government debt. Previous
to 1890 the securities of the United States were
comparatively unknown by the people of the
North, as investments were made in them only
In moderate amounts, the debt being small
and aconsiderable portion being held in foreign
countries.
We can all remember the singular manner
In which the people took hold of the seven
thirty" loan. Plain people would cautiously
purchase few Of the notes, questioning the
seller closely If they were not about as well as
he could do with his money, and generally
ending their remarks with the inference that
If Government was not good, then they did
not know what to buy. The interest tempted,
but great caution was observed in the invest
ment. The twenty year bonds Of 1881 suffered
still more. Fear took hold of the people. The
story then was, "the government seems to be
hiring considerable money, the bonds will be
cheaper by and by"-"suppose the rebels should
take Washington'-such was the strain that
monied men were apt to hear from the masses.
Bull Run knocked them down to SIS, and a
twenty year gold principal and interest bond
that had the whole nation pledged for its re-
demption, would sell nearer ninety than par,
while bank stocks and fancy shares, which
were all dependent on the life Of the nation
and at the mercy of the government without
Its resource and wealth, would sell at better
rates.
As the war progressed, men became more
convinced Of our strength and Of our ability to
crush the rebellion. We think that at the first
the monied men were in the main afraid of the
termination of the war, fearing lest the ad-
ministration might fall into the hands of set
of men regardless of honor, who would repu-
diate its debts. But New York bankers put
their shoulders to the wheel, and other cities
at once followed.
The loans needed by the Secretary of the
Treasury were speedily arranged; and from
that time, the faith of the nation has shone out
brighter, and the riches of the nation have con-
stantly poured for our country's welfare.
The victories in the West and Southwest
showed our power; and that power has in
spired the hosts of the North. Our manufac-
tories have been busy day and night. Honest
labor was never so well rewarded; and when
the loan OF 5O0,OOO,OO0 is called for, we see
how rapidly 1t is transferred from the press at
Washington to the pockets of the people. Gov
eminent loans are now believed in. A "fve
twenty" bond, which pays principal and interest
in coin, 1t is now evident to all must be good
iflands and houses and mines and quarries have
value. The employment of troops necessi-
tated their payment. The currency of sound
local banks could not be procured in sufficient
amount, and if it had been possible, the fact
that the notes of many of the banks would not
be current with the soldiers and their families
In the Eastern States would of itself have die
tated some more just and convenient course.
1t was happy provision of the government to
provide for the whole country circulating
medium uniform in its character and merits ::
saving to the West thousands Of dollars annu-
ally 10 the reduction Of their ruinous rates of
exchange on New York, and substituting for
their worthless rag money sound government
nOlc ioi tlC VI WhiSh SfSAs Aou VI
their land was pledged. But it was not the
intention of the administration to take away
from individuals the banking business of the
country. Accordingly we find that law has
been passed granting to associated capital
privileges, superior in some respects to any
which had been enjoyed by them under State
charter. And to these National Banks, the
country will look for the issue Of notes, based
on government bonds, thus guaranteed by the
whole nation. These notes will have the same
value East and West-no one can doubt their
goodness. They can at any time be used in
payment Of debts due to the government.
The business of these new banks v i'll be con-
Quoted on nearly the same plan as is now pur-
sued by State banks. They will be made the
repositories of United States funds, and will
act as agents in the negotiation of any new
loans. Their management is regulated by
laws more severe than our present State laws,
and the public is amply protected, both in de-
posts and circulation. But there is one bad
feature in the present aspect of affairs. In the
past, the banks housekeeping of course in
those times of violent spasms in the market
which induce temporary suspension main-
tanned uniform specie basis. The unusual
experience of war, coupled with severe drain
Of coin from the country, so unsettled the af-
fairs of the country as to compel suspension.
But at the present time, as far as the banks
are concerned, resumption of coin payments
might take place to-day. But it would be of
no avail. Banks would lose their metals and
would be obliged to receive their dues in 'le-
gal tender"-the specie being rapidly boarded
or exported. The new law, however, makes
no mention of specie basis. A bank bill is
noney under this law-it will draw no gold.
II the bank does not choose to give you coin
for one of their notes, you must make demand
of the government, and the pledged bonds oil
the bank will be sold and you will be paid in
"greenback." Now we think that this is an
important omission In the law. A bank bill
may be as good as gold and yet it will not pay
debt in England. Time has shown that a
solid specie basis is the best for a nation.
France has followed this policy, even in her
periods Of war, to her utmost ability. A re-
sumption OF specie payments is looked for by
the people Of this land but the National Bank
Ing Law defers the time to far indefinite fu-
ture.
The twenty year bonds Of the United States
now sell at an actual premium of near eight