The New York herald. [volume] (New York [N.Y.]) 1840-1920, 1869-11-14
Treasury POLICY-THE MISTAKE.
TO THE EDITOR OF THE HERALD

70 THE EDITOR OF THE HERALD
Our last letter referred to The great mistake made
by our pub ic men IN supp0sng that our coined
paper is changed IN current value by the varying
prices OF gold. This great mistake has worked
serious injury to our material interests, has pre-
vented the adoption OF proper measures In the fund
ing OF our public debt and has produced the ruinous
and suicidal policy OF running up and continuously
increasing our public debt In Europe, which Will
entail upon us the payment Of an enormous semi
annual tribute to European bankers, that Is not
necessary to our progress as people or independ-
ence as q nation. As this mistake has worked such
sud disasters, and IS the source of all woes,
we cannot expend too much time and labor In
proving to the people that this belief In the depre
citation of the value OF coined paper Is founded
upon an error
Gold coined by our mint Is aduterated to the
extent OF nine per cent This gold coin is at par In
our country in every part OF It. But when our mer.
chants deal with Europe the par OF exchange Is 100
per cent-that Is, our gold coin Is nine per cent
below the gold standard in Europe. Therefore when
bill Of exchange is purchased IN London the pur-
chaser must pay s1oa Of our coined gold for 800 In
London. Thus you will perceive that our gold coin
has long been subject for purchase and sale Ia
market. The quotations daily made OF sales Of
exchange are at the par OF our gold coin. The sell
iers and buyers OF exchange take the pure gold az
the standard. and thus the quotations are for par
100. Now It will be easy to understand that oil pur
chasers Of exchange must pay In gold Its equiva
lent. TO obtain the gold they must purchase 1t at
at the market price. 1t VIII DO seen by this state
and demand. II the supply ID equal to the demand
our coined gold will stand at l09 Il the supply is
pss in ep TO the demand our standard or
par thus shown to be nine per cent lower than the
European sandard AS therefore, me demand lena, IN
unsettle our standard and take from us our gold
| The demand having risen to ten per cent, ship
ment OF gold Will follow, because this additional per
| cent will pay for the shipment &c. Then, pre-
| MUM OF ten per cent caused by foreign demand
for gold will carry 1t all out OF the country, unless
1 higher premium snail DO offered for II here. But q
continued foreign demand for gold OF ten per cent
specie payments by our banks. And nothing can
keep portion OF our gold here but the imperative
/ demand for customs duties. This demand - made
by law necessity, and therefore, competition has
arisen In the purchase OF gold between the exporter
Of coin and the payer OF coin for duties
| demand has drawn the attention OF brokers to
the fluctuations occaslonsd By these rival purchasers
and hence the daily quotations at the brokers'
| boards.
II there was no call for gold to pay duties at the
/ Custom House there would be no sales at the Gold
Room, and consequently all quotations wond be
| for export and by merchants and bankers IN the
regular course OF their business THIS plain business
| like way OF treating the question would provo at
the source OF the demand and the occasion OF It,
| The demand for gold by importers Is occasioned
BY excessive importations, exceeding now BY several
| hundred millions our farm and gold exports.
The imperlous demand for gold here arises from
| on inudicious act OF Congress that casts discredt
upon our securities and upon the patriotism OF
people by discriminating in favor OF the holders Of
government bonds IN the promise TO pay coined gold
| for interest.
THIS brief and imperfect statement shows that the
| price OF gold Is caused by the demand for export
and for use In paying duties This 10 the point to
which wish to attract the attention OF our people,
| and which should now attract general notice. For
II we satisfy the people that their credit in the
shape OF coined paper Is unimpaired, and that the
assertion that we are circulating deprecated cur
| rency Is false, then we can propose remedy that
will meet the wants OF the West " the most erec.
| tive ana satisfactory manner.
Within few mouths there have been indications
OF more correct view OF the cause of the depres<
| merchant and farmer IA beginning TO LOOK to the
quotations Of the price OF god because he t9ds that