New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1869-12-06

business community The private banker, de-
must charge much higher rate OF interest to realize the
same relative profit supposlng OF course that the ds
100000 capital invested III securities bearing six per cent
interest," upon which II has received ~ circulation:
profit of Sl23OO capital The private banker, lend
toners twelve per cent TO realize the same profit
bank. The merchant and the radesman know this and
expect pay about that difference the OF money
which their necessities compel them to resort to private
bankers and brokers'
upon the business public by enabling IL to borrow money
at moderate rates Of interest than generally realized or
admitted. III all the banks deprived OF their clrcu-
laon during the coming year by act OF Congress tho
of the country won he nearly doubed The Sss9mption
by the Government OF the sole power to Issue circulating
notes would In nowse furnish relief The United States
get its notes into circulation by paying them out for
its expenses and tn payment OF its debts Not being able
to do banking business, however, t cannot lend them
as a bank can, but would have to pay them out to
its creditors, and, In the end the notes would come
neople at high rates . OF interest Taking tho
country as whole, Government and people
the issue Of its own notes~or to use an ex-
preston in the amount saved by the use Of
It's notes as loan without nterest-woud not com
pensae for the additional tax upon the business Of the
country caused P the advance e rates OF h c
culation The amount loaned by the national banks 10
the business of the country will average about
sOOOO0 and for every addition OF one per cent 70 the
rate of interest @ OF not less than SIOO would Do
1--WE Ser cent TO the rate of interest would make the tax
less than s350OO This would be the actual money
dem while it would be very serious drawback TO the
prosperity Of the country could not well be estimated In
money. As general thing, national BANKS lend money
TO their at about the legal rates. though Oh
course there exceptional cases. -,
Heavy taxation also, is burden on the business OF inc
country and like every other item that enters INTO tho
expense OF conducting any business the burden borne
II by the customer consumer. BANKING sys-
TENS had been in operation IN several states Tor num-
years before the that issued circulation based
upon deposit OF State United States bonds and there
limitation to the number OF such banks or 10 the
amount of circulation they might The deposit OF
bonds required security tle Clfcuf
ton OF national banks nothing new either IN theory OF
practice The that the United States PAID the IN
terest on its bonds in gold which gold was sold Oy the
banks at premium enabled them TO make larger pions
than were accustomed to be realized by State banks Or
merly doing business under similar circumstances. And
the additional fact that the amount Of circulation that
could be issued by national banks was Limited
to 100000 OOO-giyng TO the system the semblsnce
of q monopoy-operated to produce an lnpres
sion in the public mind that national banks banks
were mines OF wealth. realizing TO their sockhoders
fabulous dividends Some of the earlier banks which
sold their gold interest at from 100 10 leO per cent pre-
mium and which sold fyetwenty bonds iOr the agents
OF the Government TO the amount OF millions PropaST
did realize very large profits But that gay has Pae
The average dividend made by the banks during the
their capital after deductiDg taxes and expenses ana
as the premium on gold shall diminish ana the hatohat
banking system shall be made free 70 an VINO are aDe
and choose to comply with its conditions the average
profit will conform 10 the law which governs all Dus
SOUND CURRENCY. -
The currency constitutes very important part OF tne
financial system OF any country without sunni cur
rency healthy financial condition Is Impossible There
are two requisites sound currency -cOnyertlDihy
The present currency of United States possesses
neither OF these requisites During the last year II mas
neither increased or diminished, but stands ABOUT as
did this time year. Will be seen BY tho following
table:
statement of United States currency for 1868 and lsS'
Noe. !, 1860. Noe l, 1862
Legal tenders ..........S3 56O2l.U'3 $5l6llS'@s
Fractional currency. a5,il5'so' S''Ooo'4tz
Total ................ $3.50, 4s5.o58 s3,3,l487oo
sTs,se OF OIL i Tssonai Sc2i5T
Total increase. s37lS'6l
The volume or currency thus stands 1890 100000 issued
bv the Government and $500 100000 issued by the BANKS
neither redeemable convertible into anything more
valuable aud therefore not susceptible OF reduction oy
any ordinary process, each issued 10 the fun limit
allowed By law, with no power OF expansion le Nnoo
amount must be employed. wheherit IS wanted or not
and the limit cannot exceeded matter how urgently
| more may he required. During the summer months,
when there rest In almost all branches OF trade inc
whole circulation was in market seeking employment;
and now that Autumn has come, with us bQnnteous mar
vests when the farmer seeks 10 realize IN money Tue
reward Of his labor and the interests OF MS capa tor me
whole year when hundreds Oh iIo1S t G IS 'i
uted throughout the length ana Dreauh OF tne lau VIC
have the same unyarying amount 4i currency 70 USE
/ directly by the Government tne otner i'Su e,S ~
| the blanks One kind would seem 10 De enough
other withdrawn Applying the drst the Govern
ment Issues Is noted at once that they are NOT redee
purpose. The very moment they are made redeemaple
they will 10 answer the purposes OF currency Ior
after they redeemed they are III the treasury ana
cannot again DC pau opt viii the constitn5pal pro-
Except AS disbursements may be necessary pay
expenses and debts OF the Government SO thar Gov
eminent circulation not convertible, and therefore Is
not elastic and cannot De made 80 without nfsJ AnB
radical change in the organization Of the United States
Treasury by which it should DC converted Into huge
banking Institution, calculated 10 receive deposits MAKE
loans ana Otherwise perform inc IuCtiOhs VI h1''Vn@
The notes issued by national banks are nOmnaly re-
deemable and II the legal tender oUE Of tho
Srsr Noud actually be So and being issued by nstu-
Ions sympathy with trade would contract and ehpana
they would also possess the element OF elasticity As 70
the comparative merits OF the two kinds OF currency, an
impartial consideration would probably ueolue IN aNot
OF bank circulation, principally Dtedus5 !. Nouli P,
power OF adapting ilsei 70 to ~ y.
trade II Government issues cOuu be hiur 10 pOesess
thrtsame power OF adaptation the verdict would De IN
their favor long, therefore, as the collection OF tpe
revenues Is llaele 10 De process "a - tSr, IN
disbursement process Of nhauOn the age through
which collections and disbursements are effected cannot
be regarded suitable agencies for furnishing asouhd
! currency 10 the people
The argument that the Government should furnish the
currency IN order that II may realize the ptoht upon It's
circulation a common one but Will not bear scrutiny.
There is no profit TO the Government on Ine @
OF an inferior currency Ony s0unu currency WI Pto
mote the material prosperity Of the people ana me Gov,
eminent can realize no profit from anything detrimental
10 their interests As currency therefore, Goyernment
issues profitable As loan without interest lney
are equally improbable, because they are Injurious 10
the national credit and add enormously TO the expenses
OF the Government II, however ~ II posslole LOT inc
order 20 furnish sound currency can at least provide
for the withdrawal OF It's own notes, ana prescribe the
better currency may be- provided AS before stated
there should be but one paper currency IN the country
and that should source that j. lhdcnced
by and is amenable the laws OF trade No check or
Limitation should be imposed upon IL other than the la"
OF supply aud demand
FREE BANKING.
The banking system now IN operation under the act OF
Congress doubtless al improvement upon The c0ndi-
uuSf THINKS that prevailed prior TO It's inauguration
IL NAV have mperfeetOnS, but most OF them can be
traced % the evils OF an rrcdeemale currency Abuses
OF various kinds practiced or tolerated. during sus
pension OF specie payments. that would disappear OF
themselves healthier financial atmosphere aud. as
observation and experience bring to light detects, they
may corrected by judicous legislation ANY radical
changes wOnld affect many ana suth great inter
ests that would be safer and build upon ana
mproye the present system bring IL fully up