Middletown transcript., 1868-01-04
The scarcity OF CURRENCY.


gently maintain that there is, at present,
a sufiiciency Of currency in any part of this
country. In our own city it has been at
no time abundant during the past two
years, while at times its scarcity has been
most annoying. Even in New York, the
great commercial centre, the point in fact
of issue and redemption, it is by no means
too plentiful, while in many portions Of
the interior, particularly in the Northwest,
and especially in the South, its almost
total absence is extremely prejudicial to
the interests ofthe community and of the
Government itself. Its scarcity hampers
trade, hinders cultivation and prevents
the development of private wealth and the
increase Of taxable property. We read
constantly in the papers of forced sales,
made in the South where most ruinous
sacrifices are constantly submitted to. In
| the Tribune under date of December
"a, we read of fine residence and ten
acres of land which sold in Georgia for
| 800 and Of 450 acres of prime land which
fetched only $l50. These are stated to
have been bona ttte sales The cores
pondent giving the information says at
was Court day "and large concourse of
people were present. The most of
" them were large property owners, but
really had not S5 in their pockets and
I" in consequence would not bid, as the
"sales were for cash." Paper money
may not actually be value but it is GER
tainly medium, of exchange, and the
United States legal tender note is the cur
rency in which the exchanges of the
country are at present made. A man may
barter his horse or his OK OF his gold
watch or his diamond pin all of which
have value; but he cannot buy with them
at public sales, where property is sold for
cash payable in the established representa-
tive of value. If it is an arbitrary meas
ure on the part of Government to make
paper the currency of country, it is
much more arbitrary act to make forced
sales payable in this currency and yet not
to provide suiioiency of it to enable the
community to effect purchases or to nego-
tiate its ordinary transactions.
But the want of currency, which is SO
evident to most people, and the unfortu-
nate business experiences of the past year
are not only the proofs of deficiency Of cir
culation. The truth is that we have not
to-day in this country as much currency
per capita as there is in England Or in
France. People are too much misled by
the loose statements which are constantly
being made of the volume of currency in
circulation in this country before the war.
Yet, fair comparison made between it
and the circulation to which it is now pro-
posed to restrict the country, will show Get
eris paribus decided decrease of curren-
cy in the last decade. i,5 -. .l
The currency of to-day consists of u S.
notes 1857 900, 600, and National Bank
notes $293, ,000I000. We take no ac-
count OF the small note circulation, as that
is about equal to the average currency
cash balance retained by the Treasury
Department, nor Of the legal tender COM
pound interest notes, as they are being
rapidly withdrawn from circulation. We
are to have, therefore, total circulation
of $3.50, 900, 900. If we deduct from this
the amonnt held by the banks as reserve
fund, which was in October, 1866, $205,-
770, $40, and which we will estimate at
$500, ,0O0, 900, we will have S450, 600 900
as the total proposed available active cir
|, culation. & .s@ isH
= The bank circulation for the years 1858,
1859, 1860 averaged over $500, 600 900.
J The specie in bank averaged over $02,-
900, 900. 1t was estimated that the a.
mount of specie afoat was about equal. to
: the bank note circulation. five place it,
} however, only at $3.50, ,000, 900, we still
, have total circulation of $442, 600, 900.
Deducting from these the reserve of specie
> held by the banks of $92, 900, 600, and we
have left an active actual circulation o.
$3.50, 200, 600 on specie basis, which, al
: premium Of 30 per cent. is equal tc
: $4T2, 800, 600 in paper currency. So thai
' without taking into calculation the grow.
g ing population of this country, its increas.
ing business, and, what is really more
important, the increased requirements fol
Q currency rendered necessary by the abo,
lition Of the credit system, we find thai
Q the circulation to which it is proposed tc
K restrict us is actually less, calculated on
e gold basis, than twas before the war.
: In 1888, estimating the population a
80, ,000, 900 the per capita circulation wa,
h in specie $ll.86, equal at present price,
J. of gold to $15.75. The proposed pei
i capita circulation after the withdrawal o
the compound interest notes, estimatin,
the population at 35,000,000, will b
$l2.S6, considerably less ceteris paribu
! than that OF ten years ago. Does not thi
| show plainly that the volume of currenc,
!, in the country is not sufficient for the ac
r tual wants of the community ? @
Mr.. Moran, in his work on money, pag
200, gives us the received estimate cir
: culation of $2S per head We will take
: however, medium of $25, at which rate
= to supply population of 30, ,000, ,000, W
u would require circulation of $500, 900,
: 900 on coin basis, as against a paper circu
o lation Of $50, 900, 900, which is the pres
ent note circulation Of the country, con
# siderable portion of which is locked up a
/ a reserve fund in the Banks. We mus