Memphis daily appeal. [volume] (Memphis, Tenn.) 1847-1886, 1867-02-02
TIE PUBLIC nEar AMI TIE CUR


There Is no evidence Of q redun-
dsncy of currency at present, and the
premium on gold and its recent rise IS
no proof Of it. Gold declined rom w
to Us In the face Of a larger circulation
than exists at present.
The compound interest netes in Sep
tember, 1865. amounted to Sz~lfiOOo,uVo'
and then formed q part OF b regular
daily circulation OF the country and al
the same time there were S~t54,OOO,0OO OF
legal tenders and fractional currency
afoat. making a total treasury circula-
ton Of S67I, coo, 600, independent of ma
tional bank circulation. Gold was then
at Is7, and continued TO decline, in face
Of that large amount of paper. 1t was
after this period hat the continued
&C emulation Of interest on these COM
pound notes made them an object for IN
vestment, and now the whole OF them
have disappeared, and will never again
~appear as currency. This has been not
only q virtual, but an actual contraction
Of the currency to that large amount.
The treasury, under the authority of
congress, has for some time, and still is,
contracting the currency at the rate OF
four millions monthly, until II Is now
down toyS8S0, 600, 900, from S6Tl 100000 /
z September, 1865, and from S6~25iOO0,OOOin
4 AbriI. 1866, when hostilities ceased, since
z which latter date the south has been
supplied with a large amount of the ex-
/ isting $3.50, COZ, 1000, thus making a virtual
| contraction to this latter additional
\ amount at least so far as the northern
states are concerned. The currency
which ~previous to April, 1855, was re-
uuired bv the wants of 24,00O,OOO OF peo-
Die. now is diffused among S5iOOOiOO0i
/ and II is a notorious fact that the south
IL deficient in a full supply Of currency,
Int which is gradually flowing there,
and thus still diminishing the volume OF
It at the north.
Among some Of the ablest hnanelers a
I conviction exists that the contraction OF
our circulation to the extent OF four mil
lions monthly, a. now authorized by law,
i iniudicious and uncalled for but a
more serious evil is ahead Of US, to which
we have previously alluded, as regards
Z the compouud rates. As the e~ighty-twO
+ million Of these notes mature, which the
! national banks hold as part OF their re-
| serve. which the great bulk Of them Will
do in the course Of the present year,
these banks, as the law now stands, have
nU other alternative but to supply their
Mace with greenbacks, thus making tins
heavy and violent contraction, in dbl
ion II the monthly contraction by the
treasury. This is a subject which ought
To claim the attention of congress- as We
Dresunre no one will advocate a contrac-
ton by she treasury, and by this substl-
lion for compound notes TO the extent OF
one hundred and thirty millions IN 1901.
We should be pleased 10 have any better
plan adopted than the n We have alIu-
ded 10 Of allowing the banks 10 invest
these compound notes IN q new hVe per
cent stock. and to hold this latter TO an
extent not exceeding one-haif OF their
reserve fund.
Of \ three hundred and eighty mill
Lions of legal tenders now existing, the
treasury itself holds on an average from
thirty to forty millions, and the national
hanks always hold also a very large
amount, not only as part Of their reserve,
Int likewise for their current daily BUSH
ness. All this twhichis actually hOarded)
reduces very materially the amount that
il In the hands of the community as a
real circulating medium.
II is not the amount of currency that
keeps up the present premium on gold
though that premium is comparatively
low TO what il has been. The premium
on gold in July, 1864, was 2S5, with
heavy circulation, independent Of ma
tiopal banks, of more than SjO0,00Oi 600
and in the face of an increase Of that cir
culation to $3.50, 600, 900, and in a state of
fierce war, it declined in September,
1864, to lS7, and in September, 1865, the
treasury had, as already stated, a circu-
lation, including compound notes, to the
extent Of S67l, 900, 00C and yet gold con-
tinued to decline, and at one period went
down to lbs, and is now only II per cent.
above the lowest point.
Gold would have continued to decline,
but for the general distrust as to the
adoption of ultra measures in congress,
and st this moment the recent advance
in it is solely from the dread OF injudi-
cious legislation, not only on political but
also on financial matters.
An actual and serious attempt at i'm
parchment would at once set gold zen
the rampage and an assault on the
currency Of the national banks would in
like mi have a most unfortunate
effect. If our domestic political difficult
had not interfered, we should have
seen gold steadily decline, so that the
for the resumption of specie pay
meats would have come within striking
distance, even at an earlier date than
suggested in the treasury report.
II the measures Of Impeachment and
ultra legislation as regards the south,
war upon the national bank currency,
and other extreme measures that have
been suggested or proposed, are to be
acted upon, they will most seriously al.
feet the general business Of the country,
create general alarm, produce a crisis,
and throw everything, particularly as
regards the public finances, into cOufu-
sion. The national credit would be most
seriously damaged at home and abroad,
and one Of the first results would be a
return Of our stocks from Europe to an
amount which, with our heavy impOrta-
ions, would drain US Of every accessible
iOllar Of gold,RIf we had a debt Of only
i've hundred OF even one thousand mil
ions, we might venture TO trife with
md strain our credit without very great
injury but when that debt is g, 200, OOO,-
100 il is a most dangerous experiment,
md the building which, with proper,
prudent, and wise legislation, would be
Is solid as a massive stone ediiee, may
lrove to be q house Of cards, that would
all into irretrievshle ruin,
Our domestic difficulties are the great
-ock ahead Of US, as regards our pros
the business and finances OF the
country. II the present political excite
nent could be Gained down, ultra and
measures abandoned, and the
minds Of the community be treasured Of
/ speedy and p~eaceabie settlement Of our
.ocai troubles, We should see gold steadily
and surely decline, and soon approx
to a rate that would render a re-
sumption Of specie payments n compare
lively easy operation, a we think we
show. H.