The New York herald. [volume] (New York [N.Y.]) 1840-1920, 1866-02-04

buildings and other property to the value of fifty thou.
sand dollars.
The Currency-Beginning Mt the Wrong
End.
The policy Of Withdrawing the legal tenders
from circulation and to supply their place
with notes of the national banks, we deem
a very short-sighted policy-a policy which,
in the end, must prove disastrous, both
financially and politically. In fact it is be-
ginning at the wrong end. We do not
know what amount of circulation the Secre-
adequate, for the business of the country. In
his report he expressed the opinion that our
currency was redundant, and that 1t ought to
be contracted in order to return TO specie pay
ments; but, judging from what he has done
since and proposes 10 do. he does not find i prac-
ticable to carry out his views. The hard money
theory is M excellent one, and we are all for it
when-it can be practically applied. The theory
that all men are born free and equal is an ex-
celent one, too, to the extent to which it Is ap-
plicable; but it so happens that nature has
made great inequalities in races and in the in
dividuals of the same race. So with regard to
an exclusive hard money circulation, natural
or adventurous causes may stand in the way.
But surely the way 10 return to specie pay
ments is not by withdrawing orfe kind of paper
money and substituting another for It's not
by taking away the best, as the legal tenders,
based entirely on the government credit, and
giving us in their place the less reliable and
LOGS ouhstont;ol no tionoI hcpL rot.o II ,o,y
be said that the government securities depos-
tied to secure the redemption OF the national
bank notes, or thereabout, are guarantee to
the public. This is true only to a certain cx-
tent. There is no security against these banks
becoming insolvent through overtrading, spec
ulation or mismanagement; and even the Sc
curities held for their circulation, when forced
upon the market in crisis, may not meet the
amount their notes call for. great financial
crisis would necessarily reduce the value of
these securities, and the note holders or credit
ors of the banks might not obtain more than fifty
per cent Of the vaue promised on the face Of
the notes. There is something bordering on q
fraud upon the public in these national bank
They are called national
banks, the notes are printed and Issued by The
and the mass Of the people are
led TO believe, consequently, that the govern
ment IL bound to redeem the notes. They are
no more national in this sense than The old
the payment of the notes and could only pro-
tect the holders to the extent of what the secu-
rites deposited might fetch. 1t requires but
little sagacity to perceive, therefore, on what
an insecure foundation we rest, or what fear
full state of things must be the consequence of
any great financial difficulty in the Country.
On the other hand, the government is bound
for the legal tenders and whatever troubles
we may pass through they would be good in
the end, for the government exists always.
Indeed, who could have any doubt that the
notes issued by the government Of this great
and productive country, on its own credit and
in its own name, will always be goods
But, Independently Of the superior value and
greater security in legal tenders to the pub
lie, il seems monstrous for the government
TO lend its credit to those private corporations
called national banks even 10 the extent Il
does. If there is to be q circulation of three,
four or five hundrd millions Of notes called
national, why should they not be really and
truly national-that is, government money!
The profit on the currency loaned TO these pri-
vate corporations, even while its full redemp-
ton Is not guaranteed, is enormous. Besides
this, they draw six or seven per cent on the Sc
curities deposited. In all, probably the banks
make over fifteen per cent out of the people
upon their capital invested. Should their cir
culation reach five hundred millions, as II must
ifthe present system should continue and the
banks be proportionately distributed over the
whole country, they would draw from the in
dustry Of the people sixty or seventy millions
annually. And what do they give for IT. Ac-
commodationi Would not legal tenders &C.
commodate the public quite as well, or better,
fpersons or companies wish TO bank, why can
they not bank on legal tendersi Why should
Tho government lend ih credit 10 individuAls