The New York herald. [volume] (New York [N.Y.]) 1840-1920, 1863-02-09

ana STOCKS, continued their efforts in the early
part of the week to cause a stringency in the
money market, with q view Of getting higher rates
for their loans and buying stocks at lower prices.
No more important result flowed from the demon
straton than the slaughter Of some weak opera
tors in stocks. Latterly. q number of merchants
and moneyed men have got into the habit of de-
posting their balance with established stock com.
mission houses at the market rate of interest and
on ample margin. This system, which prevails
extensively in Europe, tends to emancipate the
brokers from the control of the private bankers Of
Well street, and, on the other hand, enables mer-
chants and moneyed men to earn 6a7 per
cent, as the case may be, upon their balance over
night At the close Of bank hours yester
day money was freely offered at six per cent on
call. First class commercial paper sold at 5L 6L
per cent. Government certificates of indebtedness
were shade better, aud were wanted at "a per
cent. Attempts are being made by bankers to
keep up the price Of money by spreading state
ments to the effect that the new interest bearing
Treasury notes will act as abscrbents, and will
draw the deposits from the banks. But people are
not likely to be long deluded by such shallow
theories. NetL er the banks nor the dcpositors in
bank are in position to absorb Treasury notes
until they supplied with more legal tender notes
than they have at present. The recent report Of
the Bank Department shows that all the banks and
all the people in this State could not now take and
pay for more than $40 600 900 of the $500 900 900
Treasury notes which it is proposed to issue. IF
the notes are made legal tender-as proposed
by the Senate--they will be eagerly accepted
by the people, and will circulate freely as
money until they come to bear cons-
derable amount Of interest. If they are merely
exchangeable for legal tenders--as proposed by
the House-the first which are issued will be rapid
ly exchanged by the banks for the sake of in
creasing their supply of legal tender money to
meet depositors' checks. Eventually they may
be used by country and savings banks as an in
vestment. But at present there is no loose money
here seeking investment, which, in the present
condition of the currency, and with the present
prospects Of the country, is likely to flow in that
direction. The pretended Secretary Of the 80
called Confederate States tried the effect Of nte-
rest bearing Treasury notes some months ago.
According to the financial statement Of the rebel
Treasury Department published in the HERALD q
few days ago-t would appear that quite large
amount Of these interest bearing notes have
been foated at the South. But they did
not have the effect of making money
dear at Richmond, or of checking the in
fation which has quadrupled the currency
price Of all kinds Of property in the rebellious
States. They circulate as money, and though
some are boarded as the period approaches for the
payment OF interest on them, they really operate
rather to aggravate than to check the deprecia.
ton Of the rebel currency They are in fact there
as here. nothing more and nothing less than paper
money; and, under all circumstances, paper money
must dcpreciate, and the current rate OF interest
must decline, in the ratio Of its issues.
Gold was less active last week than during the
week previous. After selling at l6O it fell to 1856,
and closed yesterday at about 1861. Exchange
sold at one time high as IT. but closed yes
terday at about l73. The expedency of taxing
speculation in gold is being actively discussed both
at Washington and at Albany Sound opinion
in Wall street is settled the point that it is mex
pcdient to attempt to check the advance in gold
by legislative enactment. 1t is believed. in the
irst place. that no law that could be devised would
achieve the desired result, because it would be in
violation OF the supreme law Of trade which de-
clarcs that issues of paper money must cause gold
to appreciate; and secondly, that any legislative
restriction upon the freedom Of trade in gold would
alarm the community at large and rather increase
than diminish boarding. AT the same time, when
the country needs revenue from every source and
every honest trade is taxed to its utmost capacity
we see no reason why the gold spectators should
not contribute portion Of their gains to the ma.
tional exchcquer. A tax Of one eighth Of one per
cent all sales and purchases OF gold made at
either of the stock boards, or at auction, or at
brokers' Office would not operate to prohibit deal
ings in gold, and at the same time would yield
raj Ia no act ALI
all contracts void unless the tax were paid. This
Is about as far as sound discretion would Justify
legislative interference with tho trade in gold.
The Senate will probably take action tomorrow
or next day upon the amended financial bill which
was reported on Friday by Mr.. Fessenden, from
the Finance Committee. We learn that the House
committee, keenly conscious OF the value Of time,
have already opened informal negotiations with
the Senate committee, with view to obviate the
necessity Of q formal conference which would
necessarily involve delay and that the representa-
lives Of the House express their willingness 70
yield TO the Senate in the matter Of the pet
banks" the amount Of bonds and their length,
and the provision rendering the Treasury notes .
legal tender, provided the senate wil yield TO the
House on the proposed issue Of $500 900 900
legal tender notes. IL is argued BY the House ma
nsgers that the frst duty Of Congress Is 10 leave
the finances in such condition that there shall be
no risk Of any want Of money to pay the troops.
and that the best way TO fuil this duty will be to
invest Mr.. Chase with plensry authority. An act
authorizing the issue OF $500 ,oOo 900 legal tender
$500 900 900 Treasury notes and $500, ooo, 900 long
bonds would render the Secretary master Of the
situation, and would, on the one hand, leave him
free to provide money by the method which he
might deem most expedient, and on the other
would clearly devolve upon him the responsibility
of any financial failure. Under such law
he could either borrow on long bonds or borrow
on short bonds. or issue his legal tender paper, |
as. in his judgment, the circumstances of the
country and the temper of moneyed men and banks |
might justify; and with such pIenary powers he
aone xnnld be resnonaihle f the soldiers rouai,aa