The Portland daily press., 1865-11-22

DE ouincet in his "Templars' Dialogues,
takes occasion 10 distinguish the common ana
improper use of the word pdradoS-ineail-
inc what has specious air Of truth, ou'
"a IN fact false-from the correct use, 70 sisr
nifty the direct opposite-that which has tne
annearance of falsehood, but is In fact true
II IS one of these apparent contradictions, In
IN which we are directly led when we endea-
vor 10 state in a single sentence the prime
cause of the late financial panic and present
monetary stringency. Money Is Ho,o scarce,
because IL Is too plenty. --,--.r
We need not say that the precious metals
are fitted to measure other values by the per
manency of their own. We reed not point
out the evils which flow from the substitution
OF an inconvertible paper currency, whose
daily fluctuations are marked by the daily va
rying quotations OF gold. 1t is necessary
however, to dwell fo- a moment on the Iact
that paper currency exchanseab'e at par
for gold will always be limited by the necessi-
ties of trade, superfuous issues promptly re-
turning to realize the values which they mere
~ represent: and that a suspension OF specie
payments has no other motive or purpose than
to keep afoat larger amount of paper than
is actually required. But if larger amount
of money is offering for goods, if money is
too plenty, prices must advance. II the pro-
ductien of corn is increased, if corn becomes
moreapleny in all markets, it viii be worth
less money. If the supply Of money is in
creased, if money becomes more plenty in all
markets, it will be worth less corn; that is to
say, the price of corn viii advance, and SO will
all other prices. 1t is impossible to deny that
the high prices under which our commerce
languishes and our domestic trade staggers,
have reached their present proportions main
ly because money is too plenty.
Profits have not advanced with advancing
prices. Merchants who held large stocks in
1861, or who bought largely in the first years
of the war, did indeed realize a. handsome
profit. The cost of production however kept
close behind them, was indeed the real cause
of the advance in prices-cost of production
estimated I'M depreciating currency, and
augmented by increasing wages for labor and
cost of materials. Expenses Of all kinds were
growing at the same time, and it is safe tos say
that the net profits Of the majority of our mer-
chants are certainly not greater, perhaps less,
to-day than they were before the war.
To transact the same amount of business
noao requires considerably larger capital than
before the war. Our business men, whose
capacity and opportunities best fit them to
speak with authority and command our con-
fidence, declare that there is scarcity of mon
ey to accommodate the needs of legitimate
trade in this city. We cannot doubt the state
ment. 1t is the fashion to speak of lspecula-J
ton as the cause of all financial troubles, and
in ordinary times it is good fashion enoush
But speculation thrives on credit, and credit is
now hard to get. These are not speculative
times. Look through the markets of this city,
and you will not find heavy stocks in any de-
partment. In most, they are much lighter
than usual, kept down to the lowest figure
everything snug for gale. Money is scarce,
no doubt Of it; hard to command for pur-
poses of legitimate trade. And the reason is,
because prices are SO much enhanced that the
regular exchanges Of this, market demand
more money than formerly. And prices are
enhanced because there is too much paper
money afoat in the country at large, and
there is no conduit to let it off.
Out of this vicious circle, we see no escape
save by contraction of the volume of paper
currency The more we have, the more we
want. Let us have less, by such slow degrees
and wise methods as may seem best, but at
any rate Tess, and as soon as possible. We
have no pet plan of contraction to advocate.
We have no suggestions to make TO the Secre-
tary of the Treasury. 1t is our office to pub
fish and our privilege to criticise such plans as
may be submitted to the Aneiiean0 people !
from whatever source. But ills q duty, so far
as in us lies, to make plain and patent to all
readers the fact, that contraction of the cur
rency can by no means be avoided, unless we
are to go on from bad to worse and end in
blank reputation. % ~ = -
mi.