Memphis daily appeal. [volume] (Memphis, Tenn.) 1847-1886, 1864-03-18
THE FENAFCEaLsYSrRm ADOPTED
nv CONGRESS-.

Anp NuAAuINg ~ AINR A. All hoAEASf ~ ~
one hand, and at the sam time provide for largI
necessary Government expenditures BY q system
Of combined taxation and funding.
To accomplish these ends, taxation is heavy
and funding compulsory, to 3 large extent, and
not a iitls tension used when Ii is not actually
compulsory. Upon that large portion Of eircu
Istion composed of $l00 bills, The force is Also
late. These are tsIed 333 per cent on the Isl
Of April, and 10 per cent, per month afterwsTc
until funded. The original tax of 1888 per cent
however, exhausts The ~c5mpalsiOn used as re-
CARDS bills Of less denominations. For, although
8 tax Of 100 per cent. is imposed January LIST
1865, the bills Meanwhile are e1chsBgesble fol
the rev issue, without further loss by taxation
The only effect of tho exchange, therefore, is to
insure the reaching Of al the cid bills By the
tax, aud also public convenience in using bills
whose face shall correctly represent their valne.
Not only Is taxation used, bus another equal
Iy stringent force is applied in the refusal TO re-
ceive bills tor public dues,
The 7 80 notes are, by the latter means, rstr-
Cd from circulation.
The new bonds, issued 10 absorb currency
might themselves become part OF circulation.
To prevent this they sFe issued not as coupon
bonds, payable 10 bearer, bu. as registered bonds,
not negotiable By delivery, but only By trans
fer on ths books Of The Treasury Department.
The call certificates aTs dealt with, ~ The cur
reney which they Boald command.
Such are the stringent means adopted for re-
retiring and reducing the circulation.
To keep it down, as well ss bring it down, II
is provided that ell laws authorizing the issue
Of treasury notes are repealsd. 0aly notes
Issued in exchange fOf those previously out
standing can be issued at all. And, BY the
te ms Of the lunding act, only two dcllsrs OF
new can be Issued f5T three dollars Of old bills.
The aggregate OF new currency, when all IS
sued, cannot, therefore, exceed tWo-thirds Of
the volume of The old cUusncy-considering
only the non-intsres. bearing notes as such.
This currency, by being turned over and
OYER, is TO support the Government. There is,
doubtless, more than enough for the purpose, If
it can be brought back aud reissusd. It's to
return to the Government by taxation sud loans,
and be reissued from Tins to time Taxes psid
in kind bring back none into the treasury, bat
these require meme to be paid out. Taxes paid
in currency furnish The Government with cur
rency for reissue. Such is the scheme-to issue
no new notes, bu! make the substitutes fer old
notes sufics.
The provision made for loans consists 10 the
authority conferred On the Secretary Of the
Treasury to issue 6 per cent. untsxsd bonds,
with a specific pledge for tteir redemption, and
their coupons receivable in payment Of expert
and import duties. Unfortunately, tie block
sds, for the time being, prevents any particular
demand for the cOHp0ns. Yet tie bonds are
highly privileged and valuable.
Tho resources of the Government, therefore,
viii be: /. The Issue Of 50 Of new notes for
50 of old notes exchanged tor 4 per cent. bolds
2 Notes received il payment of taxes, 3
Notes lent to Government on the new = Fer
cent. bonds.
The notes exchanged for the nsw issue will
rot form part of Government resources, IS The
nav notes VIII be returned TO holders in eK-
change for the old.
Notes received in Payment Of taxes fer the
year 1864 will be few, and not enlarge govern
ment resources much; for taxes viii be paid IN
the 4 per cent. bonds, except such as are paid
in kind.
TheTefoIe, government! will be dependent, first,
on two-ihiEds of the amount funded second, On
loans, and third on the tithe5.
We have no accurate means Of knowing what
amounts Of the various denomins.ioBs have
been issued. Again is ell con C ursl what
amount will be funded of bills not forced in by
downright necessity. We viii suppose a case,
hoWeFe5:
Suppose currency to stand thus in March,
1861;
500 bills 0.O00, 900
50s, 2O8, 900
....-.-------.....- ...,..-,.... 98.O196O9
Under 3OOoV0V
Total noa-irtersst bearing. ........7O oy0oe
eOO
Total currency. SIS OO0,OO0
OF the foregoing The 7 30's sre withdrawn from
circulation from the date Of the passage of the
act, leaving seven hundred millions Of non.in-
terest-beaTing notes.
We may safely consider that all $tOO bills,
(sSve some stray bills By accideut,l will be
withdrawn. Also that enough bills will be con-
verted into foar per cent. bonds to pay the
money taEes Of 1854. Many of the ZOOS viii
used, however, in purchasing bonds tor tax
purposes; so thstof sos, COS and los therewil be
tower withdrawn tor that purpose. Agsin /:
There may be some of the money Iunded rather
than pay tho 335 per cent. tax. Suppose the
funding TO be Is follows:
sloO 2O0,O0000O
5os, 2ea. los converted into four per cents. so OO0.OeO
Do. TO avOii 335 per cent. aX............ 50oOeOeO
s. TO avoid 80 ax....-.- 2SOOOeO
Total Withdrawn fsm sireuls'o-x..... S25OOO.OO0
Leaving subject TO tax OF j35...........-. 375000,OoO
Original circulation. ...........---.. 100 .O0o,00O
TIE treasury. in exchange for these 1875
COO 600, will issue $3.50, 100000 Of the new
notes, paying them to the holders Of the old
notes.
It will have as resources the right to issue
two tnif06 OF ere amount WlAnoraW4 nom Cif-
~culstion ssy-S2l6 600. 900.
Ard also the tax, lover the 1.-THE tax paid in
1864 in money.
And for al OF ler expenses, it would depend
on loans derived from the six per cant. bonds,
snd he agreements Of contractors 10 accept six
per cent. certificates.
It would be an interesting problem 10 en-
| deAvor to ascertain the probable amount Of the
currency outstanding at several dates through
the year 1S64-ssy LIST April, May, June, July,
October, and January l, 1865.
II will touch bottom April !, when only 50
bills, ct $780, 900 600, together with the old cur
rency not funded-psssing at the ratio Of two
for three-ssy $3.50, 000, 900 more, will consii-
tuts currency. However, the ISSUE Of new
notes in exchange for the old viii then be very
rapid. By June l, the now notes viii largely
h1ve taken the place Of the old. making ciTcu-
lation, say $500 coo, 600; but then 8 reduction
will be made by taxation. Woe be 70 him who
has not provided four per cent. bonds to pay
taxes Hithsl, for currency will be scaree-rela-
lively, and taxation bSsed on the EOppositlon Il
is superintendent. l. will be hard to get money
in Nay.
In July, the s. will have disappeared large
~. People will then act more AdvISsdly o. the
decision Of the question whether IL Is wiser to
fund or 10 pay 331 per cant. tax. Soon two
thirds of the So issued viii reApPsEr in new
currency.
We msy expect very little funding, however,
/ after the dates fixed for the 33A lax. The cleo
ton will have been made before that time, and,
if not tEksR at par, the bonds viii hardly DO
taken st what is virtually so per cent. premium
ii e., $50 Of old currency for 500 bend.
In October and the fan, the tithes will be
coming in. In January, 1865. a large batch OF
taxes fal due.
The fuctustions Of currency, perhaps, will
not be altogether so great as might, at hfst
sight, be supposed. TIE grsstest soundsRce OF
currency would be outstanding at ths time con,
tracts due at the close of ths year were 10 be
discharged, perhaps the best time for en.aIge-
meut.
The foregoing gives = general view OF the
currency scheme actually adopted. Its lnge-
NOUS and has sumsrous good points. II Is TO
be remarked, however, ihss tho effect upon sx-