Daily union and American. [volume] (Nashville, Tenn.) 1865-1866, 1866-05-31
OUR FINANCIAL CONDITTON-PREs.
EMIT AND PROSPECTIVE.

Upon this vitality important subject we
copy the following from the Commercial and
Financial Chronicle, journal of high author
ity. The theory, however, which it ad-
vances in the paragraph below, as to the eff
feet Of financial troubles upon prices, are
not such as are generally entertained:
If the opinions of our most shrewd and
sagacious financial authorities are to be re-
garded, we are on the eve of monetary
changes of the highest possible Importance.
1t is net at all improbable thatgold, relieved
as it is from the depressing influence of the
treasury sales, may alternately rise above or
fall below its present price Now the mis-
chieyous notion prevails that, as gold rises,
the price of everything else ought to rise too.
And spectators are even now busted with
innumerable projects and ventures suggested
by this theory, and consequently based on
most treacherous foundation.
Were the recent rise in the premium on
gold produced by an increase in the volume
of our paper currency, we frankly admit
that there would be some ground for the ex
pectation of a general initiation of prices.
But we presume none of our commercial
ume of our legal tender paper currency is
diminishing. The compound notes are
rapidly Withdrawing from circulation, and
some stringent measures for redemption of
national bank notes will probably be enacted
by Congress which will materially diminish
the forces which have hitherto tended to in
fate the currency and raise the prices of the
necessaries of life Failing in this, how
Il l.
as is semi-officially announced, 10 adopt
method for sending home for redemption by
the issuing banks the rapidly growing accu-
mutations of their surplus outstanding notes.
Some such measure seems to be required in
the present emergency to convince these in
situations that, as well said by Mr.. McCul
loch in his last report, these notes are not
money, but promises to pay it on demand"
Those among US, therefore, who are looking
for higher prices for all kinds of commOdi
ties as a result of the possible changes in the
price of gold, will do well to bear in mind
that gold at present is in an exceptional po-
sition, and its force is governed by the for
eign exchanges and by forces outside of the
state of our paper currency. Consequently,
commodities of home raising and all goods
with the exception of foreign products, the
price OF which, TO considerable extent, may
respond to the price of gold, cannot reason
ably be expected TO rise, and may even re-
cede 1t is not, indeed, impossible that I'M
der the influence of wild, speculative ma
MIA, some advance may be realized; but if
so, there will be no small danger of a sudden
rebound, which may bring danger to the
needless spectators when they least ex-
pect it.
In view of the present political troubles
in Europe, and of the consequent prospective
changes in the money markets Of our great
cities, all business men will do well to be
more than usually careful. Those who are
trading on borrowed capital, and are ven
turing beyond their assured means, should
lose no time in taking in sail. Especially
let it be remembered that under the govern
ment of inconvertible paper money it is the
state of the currency and not the fuctuating
price of gold that regulated general prices.