The Union and journal. [volume] (Biddeford, Me.) 1858-1882, 1867-12-06


Biz per cent on Sls0yOooOO0 non.inter.
est.bearing United States notes held
permanently 10 rs,erve.;.........."'s sS@o
T0tal................ SIuUU
They receive from the government..... lvSoVuo
Leaving ...................." 5,5oo,ooo
which the banks actually pay rs o bonus to the
government for the privilege Of circulating
their own notes.
The fact should not be overlooked. In this
connection. that the banks have deposited s3i0-
900 900 with the Treasurer rs security for their
issues. Now, the United States could not pos
sibly buy over three hundred millions Of these
bonds without an actual addition Of thirty or
forty millions of gieenbacks to the amount u
Is proposed to issue In lieu Of three hundred
millions Of national bank notes. The result
would he that the government would fail to
save 81, 400 900 on forty millions Of It's bonds
which 1t could not purchase, or II would have
TO try the dangerous and unnecessary expert
nent OF again Initiating the currency.
The ninety millions OF Ave per ct. bonds
might he bought at par. ..........:..$9ooo'ooo
Suppose the six per cent. bonds could DO
bought In ut LOG, Though they are now
selling much hlgheEs2jo, Uo,OoO at LOG. eoapoooco
1t would ACKNOWLEDGEMENTS oooypoo
to buy bonds now held by the hanks. Here Is
q direct imitation of over $50. 900 900.
But the imitation would not stop here. The
withdrawal Of circulation from the banks
would cause nine out Of ten to wind up. not
because the privilege Of circulation Ia absolute
ly essential In order to do q banking business
associations would not submit To the restrictions
and limitations imposed by the act OF Congress
without the compensatory privilege OF circula-
ton. They would either reorganile under
State laws, and thus ret rid Of federal control,
or they would do business as private bankers.
In either event, the entire amount OF legal ten
ders now held in reserve would speedily be
released and added to the volume OF paper
afoat, which, with the fifty millions stated
above, would make an actual addition OF near.
ly two hundred millions to the active paper
circulation of the country.
The effect Of this It would not he difficult to
foretell. but 1t may be more appropriately con
sidered hereafter.
At this point II will not be out Of place to
consider some Of the consequences that would
be likely to result from the general closing OF
the banks Of the country.
That they would wind up may be regarded as
. certainty, and the first step would be In the
way VI construction. Discounts would be sus.
pended, accommodations would cease, and
merchants, manufacturers. and other business
men would DO deprived Of their accustomed
.~H -, T., 81. Ii. h,.;ns.. ~ ,ho
a sn TIE -;,hirawsi NJ n comnsrativsIy
0oun W ,-.,a, 80 ".,;." .a,,;,a, f,ou, Tho chan.
s'usn Po.IIa =, ~ ,ICav0 .ln.;i,, s.,, In ,L;,
hels VI uaue 20 a,uaiS i Ie n.,';,.i .o,,5
be upon q large scale. While the assets OF the
banks were being converted into cash In order
to be returned to the stockholders. business Of
every kind would be unsettled, trade would sui.
Nav''i,,,;'' ~ ,his I;nJ c,riJ NOT he offsc,aJ
II ,,D.,, ~ ."'s nu Uo ,ha onun,rv TSsrs
nilnou' se.' . as.nISo w ,"c IN,
ho uou1' tna' .he ue,na'u ,o' a'..,s ."I n,,,
yes Mou,u so1ncr Sr ,ac. 10 , S,n;,,,as
aut , .ne peod ~ nI has'uo ." nn;,aI onn,J
r"odin., ;,.stS ~, ,h. nsw has;s ,hars wouId be
.. ''u1o, .,r;nnancv Thsro 4. M disnos;tion N
$1,000 ,So sJfsct that wonIJ ma Tins pro-
Jnce5. but IL is ono of the nrobable results of
tho nr,onosed change which Il wouIi be prudent
o., ,prs;Jor and ono concernjnr wb;eb bankers
Jh,.na,. | 49,, ,.ouid hn ahis to f"rnish Wi.
anu u,o i.'n,..,.,; sa "NH'" wv "''' ~
u" %, .u.'a",;nu. ,a.-.J ,,,. t,r . - dos,cnnd
49,, ~ ,'on,,s. .rrr,nan,. oJysrcaJ In
70 meel 'no I opI,ai, s,ua..a am,;uoI,, ~ ~
maor VI Osu'" ,,, V Ill., 49, ~ oo',nonv
S, mo, IL. up - ,bo sas,Or oS inte,.
a.e oo' .L o' hnnI. dauo.;,oJ h~ ,hs harIs "a
ssoI ~" e.. ,hs;. ,sS,,a. TIT. .s S..n .hovn
-. ~ W. aos ro, .ns,"inaJ hv The facts.
P ~ y" Tunn ~. r,srsiv tschn;caj crnund nj
.nnnn,, nsId and ,eceiyeJ Inv the hanks. The
s,.,,uaa 80 ,ha, hn, ~ miiions v;II he sa,ed
nSares snow ina. out Two m'''onS Will W 'a'eu
$3.50 TaL;nC ,ho.o 6c,rs, into occount
!, has bsen e.iabii.bed that the hanks loan the
f,jor,i rnysrnr,art sloO mn (OO M less than
49,. s,s,,.,S. ~ ono nor Cont ner onnnm. and
an y. s.na., 4. ,"nr,h !, ,ho
h,nn. a. asr ."nI,,, ,,sr nnnym n Ia demon.
s.Nas.J ~, ,ho ;m,.r.., IN sisn mn ooo of
,su.I ,and"r. u onnnaiiv given IN The royern.
iosa, " .L,ah oSa"I >" ,.rss naid svsiis Tho
,n,ai ,,rnrnt nail by Tho hanks 10 tbe royern-
ment 20 SOS. 600 ooO-an excess of So. 500 600
oxcr tho interest received nv them, which In A
bonus they pay for their circulation.
Thero a 70 boweyer. other. and In n financial
noint of view. more weirhty considerations TO
be urged nrainst a paper currency furnished
exclusively by the government:
Such A currency possesses no inherent ouali-
t,ss which odant Il 10 the want. of trade. II
does not contract during seasons of inactivity.
NOR eynand to meet the demands of active busi-
mess,
Whotovor NAV be said IN TIM controry. the
facts s,onJ UNCHANGED that the ro,ernment
az, ;ss,a To- nn,o. oriv In naymant az its debis.
gnu ,Ssue . ,ts uv.e, on. ~ r",",;oa Sosws"n
. anu ,I". M H., ~. 10 .",,E;roJ al -h,.h
sn s a NV ;sa,,a5 e. 10, r,,rs anJ ,ha amn"n,
~ 's W ~ ,rsJ 20 liz ,ho hnsnss. M the
VI y n,.,,, ,oo,,,.sd ~. ,Ia arn.n
S,eun9 , 49,. o .''.oun,.,,i ~. 49, H.
u.Ises y, .ne ,', ,nai. .y $500 onn
nuu rsqur, ou' IT'LL, ,,."iS 81 ,ho rsSUm
trac.oh. anu inass MUS .; ns." ' uun,
aanGy oy ma.kns VIZ p.loe,' VI. h ; nn'
iiurnisneu ny 'ne so'. ,uad., m" ~. n.nnO,
mu. ~. u0 ""n r'r, ~ s,',,r,y Thcrs I. ~"
conn'anu . iur.nt, sSuppS, ,ta se,r, w ",
reia.,oh, no syhp;nS, ov t N.Y. ,mU =.
I'LL, " arran.v IN -. n,,sr ,xant "f tba, aIas