Western Reserve chronicle. [volume] (Warren, Ohio) 1855-1921, 1867-10-09


is obvious that the payment of the in
terest of the 500 millions. payable SIS
the interest is, in gold, costs the Gov
eminent over 40 nriHisns yearly, which
would be saved yearly for the next ten
years, by redeeming the bonds at once
with legal tenders, or greenbacks, from
the cost of deferring such redemption
ten years.
1t is also apparent from the law, the
terms of the contract, that the Gov
eminent has the legal right to SO redeem
these gold interest bearing bonds, at
onc and make this saving to the tax
payers. 1t is just and equitable for the
Government to do so; and also its duty
if practicable, VithOvt inexrringa greater
loss to the people, than the gain of the
forty millions annually thus saved
Let US see Uhat loss, ifany, would prob
ably result from this measure.
AredEndaney of currency and its depreeia-
ton from the consequent probability ofre-
pGdiatiOn on the part of the Government,
l understand to be objections urged by
Gov. Cox to these measures /; represent
ing the loss to be the value of the ex-
isting currency, and the character of the
nation.
1t certainly needs noargument to show
the danger Of T~ePudiaion on the part of
Government will not be caused or in
creased by converting this debt of 500
millions bearing interest at this time of
more than 4 per cent. in legal tender
every 6 months, into 500 millions legal
tender notes bearing no i~ntersIt. For the
whole debt could in the latter form be
paid in ten years, by the same amount
required to pay the interest in Its pres
emit form, for that time, at the present
price Of gold. More than twenty mil
lions has to be paid every six months
by the government, to prevent al in
crease By interest, and to keep the debt
from increasing; and this interest
with its compound, would, in ten years,
amount to more than the principal
There will then be less danger of repu-
diation by so redeeming, than by con.
tinuing the same on interest as it now
is. The only loss, then, if any. will be
to the business interests of the country
from q reduction of the currency.
If the criterion-the demand and
supply, be regarded, it will not be
claimed there is a redundancy in the
currency. On the contrary, through.
out the United States, there is almost
an unprecedented ~stringeney in the cur
rency. Bankers in the Middle States
are unable to supply the demand at
the before unheard of rates of 10 and II
per cent interest, double the usual bank
interest. An addition of thirty-three
or perhaps fifty per cent 10 the present
amount Of currency would doubtless
greatly benefit the business, and large
ly augment the products and wealth of
The nation. |,
The last annual report showed the
paper currency Of the country to be
about 900 millions. An augment of
500 millions, it is true is little more
than so per cent. But with an issue
of perhaps 200 millions of six per cent
interest bonds, r~edeemable, after, say
ten years, at the option of the govern
ment, payable say in forty years, ma
king the treasury notes convertible in l
to these bonds, as were the treasury
notes of1s62, into the 5.20's under that
act, all the redundant currency would
find an investment. For there can be !
no redundancy when money can be
loaned at 6 per cent interest,
certainly not when in business opera
tons money is worth 8 per cent inter-
est /; and 6 per cent interest on q. 8. !
bonds not taxable by State Law, is per-
haps equal tos per cent private bonds,
subject to State and municipal tax.
1 only mention the issue of bonds as !
the necessary concomitants of the legal s
tenders, both to maintain their value,
and to regulate the amount of curren- 1
cy, as an absorption Of redundancy
the amount and character of the bonds :
to be wisely prescribed by act of Con-
gress. J
From this brief outline Of the SUBJ
jet, while il must be admitted, there +,
would be 8 large pecuniary saving by
nO0 Tedsem;ns the 500 millions, accord I
ing to the provisions of the law under ,
which issued, there would be no cor :
respondent losses, but real advantages
to the industrial pursuits of the coun-
try; and our national products and !
wealth would be thereby greatly pro-