The New York herald., 1867-01-31
CURRENCY AND SPECIE
rseiIsR AND AMERICAN SYSTEMS.
History of Paper Money in
Great Britain.
superiority Of the Present System In
tho United States.


Rome EnRiish newspapers have lately called the a.
ssnson OF their readers to the present state Of tho
American Currency and the London Times has informed
she world that the people Of the United States are just
suffering the perplexties Of men who become sud-
denly too rich and who do not know what to do with
their money That journal great supporter Of Peels
bin, OF 1870, and can, therefore, SEQ no good In
paper currency that not convertible into gold a Axed
pries: and It ntmAss that America be really
prosperous and safe without return TO specie payments
The reade Of that journal also informed that with
the exception OF the New York importers, no ono In
this country disposed to advocate resumption Of
the last our nve years. the great struggle in which
the people OF the United States have been
engaged the extraordinary expenditure required
for carrying the war; and the wonder
fui elasticity Of the peoples industry In meeting
this great drain upon their resources It would sur
prisin2 indeed that tho people Of tho United States
should DO In favor Of return to specie and
why Because had they goriousy and entirely
emancipased themselves from the idolary for gold,
which periodically letters tie trade and of
England, they never could have carried the and
at the same time retained their powers OF production so
vigorously as they have done The way in which they
have accomplished this Is remarkable event in
morcia history 1t might be important therefore, to
bofa them II they change their present pder
into based upon gold at fixed price and
do better than take review Of some Of the prom
facts the financial history of England from the
commencement OF the great French OF 1898 TO the
pang Of tho Bank Charter Act OF 1874 Before enter
Ing upon the historical part Of the question will be
we'll 70 say few words
NATURE
There Is, sad has ever been, much misconcepon
about It. Money is Of two kinds and to understand the
curroncy question II Is necessary that we should sec
clearly tho distinction between them. The kind is
used in mercantile transactions between different
nations tho other is legally used within any given
nsion. They distinguished in Scripture 'moncy
ourveut with the merchant and .'tribute money" Tho
sssnust characteristic OF tho former is the intrinsic
vaiue Of the material Of which is made but the
tiai characteristic Of "tribue moneys the legal
thority Of the impression afxed to the material In
ths former unconed gold and silver may be money
IN the lsstsr they no not money until they
co.osd, although, Of course. they may BE- and are
nsasys worth. Tribute money may DO made OF gold, 1
sver, "copper" leather wood paper Of any othera
commodity which is comparatively worthless In itself,
the s,sn asnxed to it by the ruling Power
oonsitutiug It's value legal tender for
the payment Of definite amount OF national
Axss any other crod engagement within the State
bst this tribute money further valuable to the
ohaa who wants 70 take his money for expenditure in
fsssagn ua.ion than for the amount OF gold silver
may contain for the amount Of these any othsr
valuable commodities which he obtain for II in the
sAsea TO which this tribute money belongs In this
csuntsy this distinction between the kinds OF money
nov observed, and there Is accordingly paper cur
Fsaoy for tribute money, and tho presious metals for
mercantile money. In England this distinction 10
oSserved and the consequence that while in America
gold Q useful servant varying in price like other CON-
neAitss In England II is tyrann cal MASTER fixed in
price, aud from time TO time causing money crises such
= NE people there have just passed through.
vfsAsoiaL HISTORY ENGLAND YRox 1923
When the with France broke In 1898, the great
sbssc Of paper money In France had begun to develop
tss and this naturally aroused the fears Of the English
people lest English bank notes should also lose their
vains. Under these circumstances, many persons in
England induced TO hoard all the gold and silver
money they could accumulate this together with the
policy Of the British government produced severe
monetary panic. This panic was, In great measure.
arrested BY the judicious OF the British gov
eransat The government sanctioned IN Issue OF tx
ohequer biis hs Of which merchants and manu-.
factars who had largo stocks OF goods hsud which
the panic had rendered unstable, enabled 70 OBJ
tain an advance OF money upon their goods 70
mest their immediate payments without
fsroed saic OF their commodities BY thus Withholding
their goods from the market until the natural demand
for thsm revived, the nerchanss and manufacturers
nately 70 repay the whole amount which had been ed
ysneeA Or good. without any lcss % The ExcheQus
Dat tbs pressure Of tho war sompt lied the government
- borrow, through the medium Of the Bank OF Eng
nnd, vcU large sume Of money IN gold and silver for
fUregu opsrati0ns In 17o4-eS more than Is 600 600
= spsce we're sent ~ subsidies 10 continental ales In
1876 the Bank Directors gave much "a sa per o.
q courss, inorsassd The national diihcutes Il AZ
length became totally mpossois for the Bauk of Eng
ssd 70 cosnsus 70 supply the government with gold and
- -sncune Of hank notes and coin sufncent
iasrsasng taxes required ihe mercantile value Of the
precious metals being much above the tribute value at
tsoo1 70 them In CON- In that state OF the bullion mar
The bullion dealer bad only TO take notes 10 the
bank and demand the amount in gold silver coin the
higher ps than that attached 70 q eos coined
II manifesry impossible that this state Of things
oould ccsnus Either the government must have aban
tAsa deemed essentai 70 the sacty and honor Of
British nation, the Bank Of England while assisting
ssvernmeut Mr. Pitt therefore, with that sagacty for
vsieh he wn distinguished, advised the king,
ssu.e ~ Which K. bank ~s. rs:osss from
* ras%su & oeaid s ,sssa on .ss sss,sos Parliament
shortly Afterwards sanctioned the Suspension Of cash
psymsuts and m cot was passed % continue the sus
peason Amer this act was passed the Bank Of England
spA u the Feneh var the ono pound Bank Of England
aoss became the real representative Of the pound sr
aag.n as that term understood In al the receipts
ssd dsowscnents u the government The one pound
soss became In fact the tribute money OF the natiou
nMcnan1 who might want gold or silver for foreign
purposes had 70 bay those metals In the market juse the
ness ney bought IRON Iced copper at the current
Ioe o. the day, aad the government agents had 70 pur.
ohaee sne precious metals for all foreign purposes q
hsr market price, estimated in bank notss In the same
Casas = they bought ali other naval and military ssorss
foee 1000 sterling Of the national debts vsre bor
during ns period that the pound sterling WAS thus
segay rpresenseo oy the one pound bank note IL Was
sxpeosed ~ many that when cash payments usvc thus
suspended = the Bank Of England the markss prss a
gos1 ~ ~ rss&ive value 70 the bank note stspdard
would have been considerably snharcsd hut a vss 80
20; for - soon - the public found that bank nosss
sancttoasd By the government would pay taxes rsss:
md eli other monetary demands In the eountrv :. 49,"
sally gold coin, they had inducsment 10 nss
crsmium for gold money and the market price of yoS
declined instead of advancing 80
rhe market price Of gold was rather below the min,
ice than above u from 1927 70 17op; but in couse