Indiana State sentinel. (Indianapolis, Ind.) 1861-1865, 1863-12-28
ssco More Paper Money, wise Al
chemy.D

ssco More Paper Money, wise Al.
chemy."
This is the assertion Of Mr.. Chase in his an
nual report after contemplating the fact that ht
has put afoat four hundred million dollars, and
is about to put afoat seven hundred million dol
lars more" He put out paper Until it depreci
ated IN the market to sixty six cents on the dol
lar and then sold five twenty year stock, PAYABLE
principal and interest in gold, for that paper, dol
lar for dollar. He has the right to redeem the
stock in gold after five years. Suppose il car
be done at the end of ten there will then be paid
one hundred and sixty dollars in gold for the ust
OF sxty-six dollars in gold ten years. or nine per
cent. per annum interest. This operation that
gentleman calls "a wise alchemy and he plumes
himself upon "wise alchemy" which he practices
In the manner denounced by Richeleu, the wise
cardinal, Sin the crueible called debt" and in q
most wonderful manner. When he advocated
greenbacks be set forth their advantages in bis
first report thus:
"They are a loan without interest"
They are uniform currency"
They are constantly esua, 10 specie.n
They are l-ss ruinous than bank paper"
"They are Government promises"
They are legal tender.''
The people understood this and submitted 10
the issue, until, notwithstanding their constant
equality to specie" they are at discount OF
thirty -four cents per dollar. Mr. Chase now pro.
features are as follows:
They cost the Treasury per annum eighteen millions
They have two thousand shades Of uniformity"
1T. ..Ihsy arc never ts BE P.ia On sYSsse:',
s'They more ruinous than United States notes''
They are promises Of unknown persons"
They are not legal tender"
Mr.. Chase advances these features of the new
currency as reasons why they are superior to
United States notes. Thus indicating the singu
l.. ~. L. ID
hundred and twenty six millions of dollars of this
rredeemable and disastrous issue" are TO be put
ahOat, because the United States notes have
reached limit prescribed by law.
And the Secretary thinks it clearly nexpedient to in
crease the amount. When circulation exceeds the leg
mate requirements for real payments and exchanges
increase its volume viii increase its value ON the
contrary such addition tends inevitably TO depreciation
and depreciation, If addition be continued will find its
only practical limit in the utter worhessness of the aug
mented mass"
Now this understanding of the ultimate results
of the paper system is correct, but in inaugurat
ing a system of two thousand banks with two
hundred and twenty. six million dollars of capital
pledged to continued suspension, the Secretary
knows that he is creating a power which will
compel an increase of the limit Of capital In the
same manner that he himself demanded the orig.
inal limit of fifty millions United States notes, to
be raised successfully to two hundred, three
hundred, four hundred and fifty, nine hundred
millions, his present authority. 1t is always the
nature of dependent paper to demand more cur
rency. This principle the Secretary himself rec
ognzes.
Tbe Secretary proposes change Of this limitation
and places reliance therefore, any increase of
from increase of circulation Additional loans
this mode would indeed almost certainly prove iilusory
for diminished vaue could hardly fail to neutralize in
creased ameunt-"
When his two thousand political banks have
invested their money upon inflated values, and
have reached their limit. resistless clamor will
arise for more money "to meet the demands oil
business" the stereotyped cry in such cases
and this cry will involve the ruin of the national
credit
But Mr.. Chases "wise alchemy" manifests it
self in other wonderful ways He pretends thai
the four hundred million interest bearing legal
tenders, which he asked Congress for, are not
currency, and will not initiate prices. The law
says:
''And the said Treasury notes may be made a legal
the extent as United States notes. for thel
face value, excluding interest,""
He ponderea over these notes from March Sd
to August 3lst, and then asked the New York
banks to lend him fifty millions ON them at six
per cent, and wrote "a follows:
The issues of them will be ready during the month Of
September"
Not ready yet, December 18th.
Being legal tender for their face, excluding interest
they cannot fall be the legal tender par Bearing
teres they cannot materially effect the circulation with
reference TO gold"
The banks agreed to the loan, and Mr. Chase
eager for money, was only too willing to accom-
modate the banks. One of them suggested that
the notes should bear three coupons for semi an.
nual interest. This was agreed to. Now comes
the 'wise alchemy" which provided that those
notes should not effect the circulation" The
Law says the notes illegal tender for face ex
elusive ofinterest." Mr.. Chase SAYS "they wont
effect the circulation" The holder says "wel
see about that" He takes pair of scissors, cut:
off the coupons, which he keeps to collect agains
the Government. and passes the "face for legal
tender exclusive of interest" Mr. Chase is con
founded with this alchemy" of which the Evils
dom" is on the wrong side of the question. H'
will practice a very long time before he viii
make gold out of paper by this plan of "al-
chemy"-IN New York News.