Staunton spectator. [volume] (Staunton, Va.) 1849-1896, 1869-05-11

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The Currency.
With the exception of the Confederate States
and other revolutionary systems no government
ever had such currency as now constitutes the
circulating medium of the United States In
all other governments and in all former periods
of our own, gold and silver were the measures
of value. When we had paper Of Banks,
either United States, or State, it was redeem
able in gold and silver, and whenever Bank,
without authority of law, failed to redeem its
notes in gold and silver, it was discredited and
forced into liquidation. This obligation to re-
deem was constant check On the issue Of pa
per. If Bank issued too much, it was
promptly sent home for redemption, and thus
the gold standard was constantly applied to
measure the value Of the paper. AS long as it
was convertible into gold, it maintained its cir
culation. As soon as it became deprecated, it
would no longer perform the functions Of
money.
But now the currency of the country does
not even profess to rest on specie basis. 1t
is not even nominally convertible at the pleas
ure of the holder into gold and silver. There
is, therefore, no fixed standard which can be
applied to test It's value The whole volume OF
currency rests on credit. The T. S. Treasury
notes have the faith of the government as the
only pledge not for their present. but future re-
demption.
The notes of the Banks rest on a similar
foundation. The Banks buy bonds of the U.
S. and deposit them in the Treasury, and there
upon the government furnishes 80 per cent Of
the amount Of these bonds in Bank notes for
circulation. The U. S. bonds deposited are the
security for the redemption of these notes.
1t will thus BE- seen that the whole system OF
currency is q stupendous system of credit
There is no cash about it, and there are nc
means by which either the government or the
Banks can be made to redeem their paper in
gold.
AS might have been foreseen, the currency is
therefore as unstable and as shaky as the foun-
dalton on which it rests. The credit Of gov
ernment, like that Of individuals, depends on a
thousand adventurous facts If farmer
raises good crops, and is temperate, industrious
and frugal his credit rises. IF his crops fail
1t he frequents bairooms and gambling sa-
loons-lt he ldles his time and engages in rash
speculatlons his credit falls. So il is with ma
tons. Ii the government is wisely conducted /
If the taxes are righteousness prosperous
expenditures small-debt moderate and rela-
tons with other governments peaceful-its cred
1t VIII be good. But on the other hand, if bus
ness Is parayzed by unwise legislation-f the
people are over-taxed-if the public debt be
onerous-the people disconnected and the for
elgn relations be unsatisfactory, the credit of
the government must decline.
A currency therefore which rests not on the
sohd basis Of gold and silver, but on the nm
stable foundation Of credit must always be
tuctuating in value. Hence we have seen II.
:. currency ranging, when measured by the
gold standard from l2O to 2SO-in other words
IN one condition Of the credit of the country
800 in gold will buy $40 in greenbacks
while In another condition of government cred
1t 1t will buy $3.50. And SO it must continue
to be. wise and prudent course on the mart
OF the government will increase the yaIne If
greenDackS as compared with gold, while rash
and indlscrcet policy will diminish it As an
illustration Of this fact we saw cold few wool
ago down to l3l, and now in consequence of
sumner and Chandler speeches in the Sen
ate threatening war, and the prospect Of trouble
IN regard to Cuba, gold has gone up to 138a-
jar IN our foreign relations will carry II nm
still higher, and war with England Or onr
other great foreign power would carry gold to
2OO; Or stating the matter in another form. the
value OF Treasury notes would be diminis shed
one half.
Every olunder Of the administration will moro
or less affect the currency, because If ;mna;rc
the confidence of capitalists in the s,lvonar r.
the government.
Seeing therefore that we have such an nm
stable currency, the practical question arises
what should people who have money (currencv)
do with it?
Our answer is the best policy is to vest it in
some substantial property-real estate or per-
sonal property. Stocks and bonds partake Of
the instability cf currency, for they rest on
credit Even individual bonds and mortoaoos
are not entirely secure because they may be
paid Oft in deprecated greenbacks.
Land and houses are permanent No con-
vulsions IN politics Or finance can DESTROY them
Nothing short of an earthquake can swallow
them up.
Other considerations recommend the invest
ment In real estate. Our population is rapid,v
increasing and increased population makes an
increased demand for land and it's productions
Land therefore is not only a secure investment
but it is one likely to rise in value. The West