The Evansville journal. [volume] (Evansville, Ind.) 1866-1870, 1867-11-05

let US see how IA " <
In the first pa c. sas .EC
greenbacks coAvert- > nj Ten 1-f3
! bonds, they mas way eZ9ctlT
/ IF the same value # ti- BOMBS. " 2
aaEe chosen ten ,orais.,= sa-e.aaza--.ti2.ss
are indIsputa niY, a0LE LOBE-. 1l 81
/ principal and in ereStf haV t.ii'
seven years yet to run before tney be
| come payahIe, aud drawsug but. Tvs
per cent. interest. This Is rate ot
Interest which the people of this gen
GRAFTON VIII be perfectly satisfied to
paEi = gai
By making the Ave twent:cs GEMS
vertibleinto green backs-at the ? "a
sure of the holder, they will be cen
stantly passing into currency, and
when the currency isafteryards fund
ed into ten-forties -the eovernmenf
will save one per cent go(d interest,
as the fEe-twenties draw six per cent
10 gold, It Is a seriously disputed
question whether the principal Of the
fve-twenties Is payable in'coin or cur
rency, bat no such dispute exists in
relation TO the ten-forties. By apply
ing the surplus revenue to the pur-
chase and cancellation of the ten
forty bonds. the market price must Ct
necessity advance, and as fast as they
rise the value of the greenbacks will
advance with them In an equal degree
There are but SIP, 900, 000.of this de-
scription of bonds in the hands of the
public, and the Government will not
have to buy many of them before they
will rise to the market value of five
twenties. When this. takes place the
holders of the latter will begin to ex-
change them for -ten-forties, as we'll
as for greenb4cks. y
A bond having nearly forty years to
run, drawing five per cent, free of
taxation, ayable, psfsc41pal ard in
terest n coin, and convertible into 1e-
gal tender currency at the will of the
holder, must rapidly become popular
at home and abroad. By adopting
the plan here proposed, there can be
no doubt that the ten-forties would
quickly rise to par with the five-twen-
ties, which will add six orseven cents
In gold to the present value of the
greenback and bank note currency.
But the adoption of this plan may
Unfortunately or injuriouslyzin the
currency, says an objector. How can
it? When there is more currency
afloat than the business wants CT the
country require, the rates of interest
will fall, and then it becomes more
profitable to convert currency into
bonds than to use it. I, The bonds will
become the great savings fund Of the
American people. IF portion of
them are. issued. on which one per
cent. interest shall be paid every
seventy three days, five times 70
makes 1861, every man in the Uniop,
who had no immediate use for his
money. would change it into bonds and
keep it in that form as long as he could
spare it. The banks would do the
same thing with all their idle cash. 1t
would be perfectly safe to calculate
that a five per cent. bond, drawing
one per cent. interest every ten weeks,
and convertible into legal tenders at
the will of the holder, would always
absorb the spare currency in the
hands of the people, and would ever
exercise a powerful influence in the
direction of healthy contraction. At
the same time the country would pos
sess currency susceptible of expan-
sion when its commerce required it.
Every Fall, after the new crops be-
gan to come to market, the banks
would convert portion of their sur
plus bonds into currency, and keep
them in that shape until the dull
season" commenced, and the demand
for money fell of, when they would
change their spare currency back into
bonds.
If any ring" or combination
should be formed to initiate the cur
rency, they could only do it by with
drawing bonds from the market,
which wonld tend to render them
scarce and dearer, and that would set
everybody else converting currency
into bonds. But if a = ringP should
undertakeAtO create currency strin-
geney by converting g7eenbacks into
bonds, they would instantly cause
other people to Change bonds into
green backs, to make profit out of the
strIngency- or to prevent it. Thus,
from whatever point of>view In which
this.p.an is examined, If Wilt found
to be self-regulating and. exactly
suited to the financial necessities
of the people. But, for the purpose
of guarding against. any. posi-
blllty OF unuue expansion, it will be
very easy for Congress to provide that
the maximum amount of currency
outstanding at any time, during the
next two or three years, shall not ex-
coed what it was on the first day of
January, 1867. Our belief is, that
under the scheme here proposed, it
would not reach that limit, because
the increasing purchasing power of
the currency would enable less of it
to transact the business.of the coun-
try, and because the temptation to-
cnnrort n,nrranou snfn- hondS uhioh !