The Charleston daily news. [volume] (Charleston, S.C.) 1865-1873, 1869-12-28

The c"rrcno.-specic payments.

considers the subjects OF our excessive paper cur
rency, Its disastrous effect upon foreign trade
anu hence the desirnbcnesS and necessity OF con.
traction ana Il return to specie payments by that
agency. lie shows that the foreign balance
against us will probably average now cbout
10000 900 perannun Including the merchandise
account, the movement OF specie and bullion. the
obgatlons for Interest, excess Oh frcights carried
III foreign bottoms, and expenditures OF Amcri.
cans In foreign countries. To meet and settle
this constant Increasing and adverse balance, I'LL.
der the present condition OF prices AMI cost of
production In the United States, there Is hut one
resource, that Is, to remit certificates OF Intebt
ness. national State or corporate.
The commissioner, therefore, points a,tcntiop to
The fact that, while before the war VIC were
able to wholly pay for our foreign imports and
services with the products Of our own industry
including, after the discovery OF California, and
up 10 the beginning Of the war, srch proportion
only OF our product OF gold rs It would have been
practically useless and even mischievous for liz
TO retain. We are not now 10 doing and this
iatter circumstance would seem 10 prove beyond
question, that the aggregate OF national produc.
tion does not maintain the same proportion
as formerly 10 the aggregate OF nationa! con.
sumption.
coming TO the currency question, the commls.
SiOncr truly remarks, tnt not only in the Cfi;e,;
States, but In all other countries curs"i with an
lrrcdecmablc paper currency, the rates Of III
terest are always tho most advanced when there
Is the largcs, absolute amount :of currency IN
circulation. lie then proceeds TO consider the
EXCESS OF THE PRESENT CURRENCY.
That The present value Of currency Is In excess
i. by The lndispu, able fact that the genera,
scale OF the prices OF domestic commodities, as
tlonal commerce, Is greatly In excess OF the
prices OF other countries, nId out OF all natural
proportion to the prices Of the same coinmodi-
ties In the Unitcd States before the war.
.. The excess OF the present currency is also
proved by the further fact that the amount OF cur.
rcncy In circulation hos been arbitrarily Increased
during the past eight years considerably more
than twofoid, although the increase OF popuia.
ti0n, production and accumulated wealth during
In very much smaller proportion; nnd although
ut the former date the amount OF currency In CIR
Gnlation WAS not limited by any serious restric.
paper really or nomtnaliy rcdeeinable In specie.
Furthermore the tendency OF oil commercial
nations is towards economy In the use of cur
1t has been urged, furthermore, that by allow.
Ing the present volume or currency to remain
unaltercd, the Increase In business and the de-
velopmcnt OF the country would gradually dmin-
ish and finally remove all redundancy. To this
II may he replied, that the retaining or the pres.
ent amount of currency in calculation tends to
increase no business but what is speculative ami
to check the very development which IL expected
which elapsed from 1886 to 1850 the paper GIrcn.
latton OF the country, left free and untrammclled
TO expand Itself, Increased from one hundred and
three millions TO two hundred AMI seven millions
or at the rate OF 4.36 per cent. per annum. Now,
should the future demand continue to increase IN
years from lsG0 or until The year 1900, TO bring
the wants Of the country up to; shG present sup.
ply. In tile meantime the currency would pro-
badly remain, as now, irredceinablc or incon-
vertibe.
CONTRACTION AND ITs II. LuEscR
are then considered, aud the Commissioner de.
evils Of Imitation would seem to be contraction,
pure and simple, without nrti0cc or Indlrcclion.
In answer to the opposition to contraction on ac-
count OF the immediate distress which it is sup.
posed would follow the adoption oI such n policy
II Is declared that II requires nc'5f; cf prophecy
all tl,e hariships which contraction could entail,
whether contraction AMI its ultimate benefits be
and ns a S ees Of cont sai M
SO far as II involves commercial disaster and In
dustrlal distress, arc inevitably coming, aud
speedily. II Is evident that the process OF settling
The annual adverse balance OF trade by the trans
mission OF national or other securities cannot
e cn IS nat and S e
porfatiOns cannot be largely checked, aS many
are necessary TO domestic consumption, for our
be to destroy much larger value OF our domestic
Industry. Hence speedy exhaustion OF the sup
ply Of bonds or bullion available for export In.
wolves serious depreciation OF the prices of do
nestic commodities and general CONFUSION OF
tradc-the very effects on account OF which con.
traction Is opposed and deprecated.
AMOUNT OF GOLD NEEDED FOR REDEMPTION.
The question how much gold is needed to begin
wholly upon the answer to the prior question,
how much currency there shall be TO redeem.
Seven hundred millions OF paper could not be
kept rcdeemabe with less than seven hundred
millions Of gold, because with such on amount
Of currency 1t would inevitably be deprecated.
every holder OF paper would be esIrous to realize
With four hundred millions OF paper, on the other
hand, hundred millions OF gold would probably
be ample, because the currency, not being In eX.
cess OF the wants OF commerce, would not suffer
depreciation, and, gold and paper being on other
wise ". equal terms, paper would be preferred for
Its greater convenience In use just Ms In 1860 the
banks were fully able to redeem oil OF their cir.
cuation which wns presented for payment al.
each dollar OF Immediate liabilities. It Is not tile
rSsE between @ goia and paper thGt needs to be
paper In circulation and the volume OF national
and exchange, OF which It Is the In
strument.
Much criticism has been passed upon tho treos
ury for not adopting the policy Of boarding gold
with view TO returning 10 specie payments, Tut
u what has been snicd above Is true, such Il pol
Icy could lead TO no good results unless nccompn-
MED by measure OF coutraction; while contTac
lion would obvlatc the necessity OF any such pol.
Icy, inasmIeh as gold would then come TO us. or
he retained by us--our currency being In a health.
fnl condition inst that extent 10 which IL was
needed, obeying The same laws rs any other com
modify. Equally untcnable Is II to suppose tint
any progress can be made towards resumption by
a reduction, through government purchase and
cancellation, OF the principal OF the funded debt
II We had no national debt; II the two thousand
millions Gf public bonds were Ivy some PROCESS 10
ne transformed into an equal amount OF private
"securitics,n exchanged between citizens, lie
premium on gold would not be appreclabiy ar-
fccicd. "
1t Is not a: ail the condition OF tile credit OF the
nal,om whici, causes gold to Ge at premium,
~ proved by the fact that In Italy, Austria and
Russia-conntrics maintaining large standing ar.
lnlct constantly threatened with war, Whose
debts are larger, relatively to their resources,
lhan r. own. antl are In 10 respect In the pro.
cess o eXtinguisIment, and whose annual cx.
pcnuiturcJ, aS rule, are In excess OF their orti.
nary rcvenues-in none OF these three countries
mas lie recent depression OF the paper money
seon more than one.half as great as In the United
81 Slates. Tue reason being that the paper money
is not as much In excess as ours.
Bnt IL is urged by some that no restrictions
snould DC laitt upon the issue OF currency or any
nmia,lon OF It's amount be attempted, but that
the people themselves should be left to determine
INC eXtcut to which they viii use II. This is sound
doctrine When applied 10 currency subject to re-
demption. 1t Is not true when applied to q cur
rcncy whose sole constituent Is credit, and which