, 1863-12-15
Chase and the Heterogeneous Banks

Chase and the Heterogeneous Banks.
We extract in full what Secretary Chase
eays in his Report In relation to the shin
plaster ciculations called "banks." It will
be seen that much the greater part Of the
difference between the value Of "grcen
backs and gold is caused by the issues OF
the heterogeneous banks. II their circulation
were retired, lcgal-tcndcr and gold would
approximate very nearly to one yalue. He
says:
Much the greater part Of the rise Of prices
not accounted for by the causes inst stated,
ence between notes and gold, is attributable
to the large 1mount Of bank notes yet In cir
culation. We're these notes withdrawn from
use, it is believed that much Of the now yerr
considerable difference between coin and
United States notes would disappear Ger
tainly there ought to be no difference In favor
Of coin. when it is remembered TINT United
States bonds bearing si1, or even five per
cent. coin interest, are intnnsically worth.
unless the theory Of national bad faith or ma.
tional Insolvency is to be admitted, more
than their amount in coin; and yet such
bonds can no" be lad for their amount in
United States notes.
Nor cau q condition of affairs in which ex-
cessiye prices prevail or national notes COM
mond less than Far in coin, be regarded as of
permanent duration. While It lasts, it must
be borne with patience, and made tolcrable
by economy. No useful remedy will be
fonnd in ext1ayagant increase Of salaries and
disbursements, but an aggTovation rather Of
the evil All proper measures should be
adopted to hasten the return to the normal
condition Of prices and business: the patri-
otism and Intelligence Of the people must be
relied on for the rest.
The secretary has heretofore expressed the
n11fr $ayn f,n@ @1,o i
In which the currency Of the country affected
by bank-note circulation, Issued without
national sanction and By corporations indie
pendent Of national authority, and not receiv-
able for national dues, it cannot be question:
ed that in some similar degree the negotiation
Of national loans must be prejudiced and their
yalne to the national finances diminished.
This opinion is confirmed by observation and
experience.
:. 1mpelled, therefore, by profound sense of
the present necessity Of national currency
to the successful prosecution Of the war
IN protecting labor, cheapening exchanges,
facilitating travel, md increasing the safety
OF all business transactions; and at the same
time unwilling to urge even safutary and nee
essary reforms in such way as needlessly to
disturb e1isting conditions Or impair the ynl-
nc Of existing Investments Of capital. the Sec
Rotary recommended, in two successive re-
ports, the authorization of national banking
associations, to which the capital Of the cor.
porations now issuing notes for circulation
might be transferred, with advantage to the
parties interest as well as to the general pub
Lie. ~
The sanction Of Congress WIS given to
these views at the last session; and the SIM
Pile assurance thus given TINT, henccforth.
the country is to have national currency &C.
cured By pledge Of NATIONAL bonds, and the
belief that this currency will at no distant
day take the place Of the heterogeneous cor
por2te currency which has hitherto filed the
channels Of circulation, ut once inspired
faith In tic securities OF the Government, and
more than my other one cause enabled the
Secretary to provide for the prompt payment
Of the soldiers and the public creditors.
If the policy thus indicated shall be fairly
and judiciously pursued, md proper meas
ures adopted to induce the conversion, at
corporations Of the States into national
banking aEsocintions, and of the corporate
circulation into national currency, the Secre-
ta1y believes, and, as he thinks, not without
good grounds, TINT all the money needed for
prompt payment Of troops, and for the most
vigorous prosecution Of the war, can be OBJ
tained by loans on reasonable terms; while
nil interest On debt, and nil ordinary cIpendi-
tures, and considerable part also Of the ex-
trnordinaty expenditures caused BY this war,
will be met By the ordinary resources. Nor
does he doubt that, through wise legislation,
sustained By Intelligent popular will, and
md military administration, national cur
rency can be so approximated in recognized
value to coin, that resumption of payments
in specie can be brought about much sooner
than even sanguine persons now permit them
selves to hope.