New-York tribune., 1868-01-20

FINdNCIaL F0LLY.
From Der Special Correspondent

Fren Der Special Correspondent
W,sInSGToS, Jan. II. 1888
1t pains me to think how unable am to adequately
express the views which in my mind on listen
ing to the fragmentary discussion of Mr.. Sherman's
proposition, made yesterday in the Senate, on tho
question of concurring with the House i'll its vote 10
stop contraction. Here proposition OF the very
gravest character and farreachng consequences in
troduced by few general remarks of no particular
bearing and the modest request made that tho
Senate would just pass and get 1t ont ot the way,
and then discuss the subject hereafter. In other
words, merely hang the man, and try him afteiwad.
Nobody seemed prepared TO enter upon the discussion
of the subject and at first it looked if the Senats
was about to initiate the Boetian action OF tho
House. and expose itself to equal rdicue, by coming
TO a vote without any discussion. Neither Mr. fes-
sender Mr.. Morrill,, anybody else on the side
of sound finance, seemed, for reason, ready to
enter into an exhaustive review of the subject Bus
both these gentlemen made remarks which wer,
good so far as they went, and Mr.. Howe, who cant
always be said to be as happy strengthened the dis
cussion by his observations. His good points were,
however like pearls scattered on cobweb, and he
spoled all BY saving he should vote in opposition 10
his talk
What the discussion seemed sOrely to need was that
somebody should uncover the foundationsof of the sub
ject and plant few cornerstones on which an intel
gible review of the whole question could he reared
The first requisite good physician il the skill to
make good diagnosis. He must first be able to tell
what as bis patient before he can begin to cure him.
IL Congress proposes to legsate anew on the hnancid
nuestion il should begin BY expounding the situation
and then we can all be the better judges Of its IN
teligence and the wisdom of its proposed measures.
What is the state of affairs to which Mr. Sherman
proposes to apply his legislation' Why just this.
We have had great war. The Government has been
an enormous purchaser and consumer and has hllei
tbe channels Of trade with its promises to pay.
Many have been paid. Many remain outstanding.
IFS demand notes used as money during and since ina
war have swollen the circulation immensely ms
Secretary of the Treasury, under Congressional
guidance has been slowly paying these notes, rs'
tirng them with view to the ultimate resumption
of specie payments He wishes to be allowed 10 60
on with the process which Congress sanctioned IN
the outset with remarkable unanimty.
The process is most natural and inevitable, IL W.
are ever to return to specie But lt turns OUT, os
everybody of any thought Knew it must turn ont.
that the process of contraction is not 80 easy nor ="
profitable as the process of imitation. And although
the contraction has not proceeded far to redr
the premium specie, gold being worth as much
paper as it was year ago yet great oucry Is rats \
that the business of the country is being ruined b.
the process The evidence of this being found IL
| falling markets and general stagpatioR
In this consists the fundamental error Of the n-
hatonists in which it is easy to see Mr. sherman
participates from remark he casually let fall during
the discussion, when asked whom he proposed ~
resume contraction he replied AS soon a. the bust
ness of the country revves and becomes prosperous
Now. the real truth is that the existing financial
situation, the pressure and distress in certain
trading and producing circles, is not to bs at
1 fba Of cnFfo ppV
but to totally different First 10 Ice men
toned is superabundant productions and relaxed
consumption second is the natural reaction
| from extrayagant 10 moderate prices which
always follows period OF high commercial aud
speculative excitement; reaction growing ont OF
the nature of things, and which often takes place
without any reference to the volume of money IN
circulation. It being merely contest between
buyer and seller in which the buyer always WINS IN
the long run because of his inability long to pay ex
| travagant rates. third and commanding reason
the distrust of capital which always withdraws on
declining markets. and wh,n affairs are agtated
and unsettled waits for them to get into 4 natural
| condition.
The business of the country hnguishes for want Of
| consumers. Capitalists and prudent men every
where seeing thereacton from the high excitcmena
of the war, and the unnatural condition of the cur
rency, are waiting for things 10 touch bottom, know
| ing that there is and be nothing solid till VS.
reach specie payments The naked truth Is that We
| have reached the settling time OF long career OF
the spectators. the middlemen, the operators in
every walk and even of the great producing estsb-
| lishments and the Government itself. Aud this
settlement is not to be avoided. After every storm
comes 4 calm: after every excitement relapse. Tho
history OF the whole trading world il filled with Just
such examples Initiation is followed by collapse;
h,l,,o ht~
natural excitement by corresponding depreSson;m
| travagance by economies. But, above all the
| gigantic evils of an irredeemabe paper currency
were never overcome or escaped from but by severe
| sacrifices.
Such being the condition Of things what signIie'
it that you contraction, even renewedlya'
fate the currencyi The channels OF circulation are
over full now. No supply OF paper money can create
| one single consumer aud il is consumers that are
wanted TO make trade active and business prosper
ous Ii is alleged the floor of Congress ta' tnere
| is great distress among workngmen; only low wages
and scarcity of work. What suicidal Jolly 10 innate
OF continue imitation and thus enhance the prices OK
| living TO them when no issue of paper money can
| give them dav's work We are just entering upon
| a new phase of our paper money experience. "e"s
now to see the Joint operation of the oppression sna
robbery of the laborng classes by mcaus oil MI -
| fated currency. D.
| ENDOWMENT OF ELMIRA FEMALE COLLE6h'
pv tho stO nv the Maxwell OK