New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1869-07-19
HOW TO RESUME.

We are favored by A. Alison, ESD, Chair
man of the Currency Reform Association
! London) with the following Plan for effect
| ing a Resumption of Specie Payments AS
this Plan, unhappily, contains no provision
for making our people generally desire return
| TO Specie Payments, we consider it defective in
q vital part but we give it as it reached US.
| Mr.. Alison proposes what he calls
state Bank OF ISSUE to be established in the City Of
Washington with branches in all the large towns on the
| following principles 'N
The Bank to have power 10 ssue notes Of dollar
and upward as legal tender payable to bearer IN gold
on demand. but to do no other banking business.
2. The Bank to be managed by Governor and Coun.
Gill; who will be independent Of the Government as the
Law Courts. The State Bank will have no share capital
and viii be quite distinct from the State Treasury The
Bank will merely act trustee 70 receive the gold OF
the public exchange for promissory notes. and to re-
exchange these when required.
8. The issue Of notes:to be unlimited. As tho Bank
be called pay more gold than 1t has pre-
yiousy received, there can be no difficulty In meeting
all demands is therefore, necessity to limit the
issue TO make limit would cause periodical
money panics has been the case IN England, where
the issue OF Bank Of England notes is limited. .t.@
The State Bank notes will all be payable at the head
office Of the Bank at Washington; but only the notes
which are issued by the branches will be payable at the
Of England, where 1t is found to work WELL F's r,a
As the State notes will alwaysbe convertible into gold
at the Bank and its branches. they can never
be deprecated in value, nor can the amount in crcula
ton ever be in excess. ~
g. The Government shall receive its duties and taxes In
state notes and SPECIE aud make all its payments in the
This provision will bring thelstae Bank into full
operation at once, and afford immense facilities.
7. When large amount of gold has been accumulated
the vaults Of the State Bank-say 100000 GOETHE
Bank shall have power TO invest the surplus gold beyond
that European Government stocks such can be
readily sold for gold when that required 1t Is obvious
that II would do 20 invest any OF the funds OF the
Bank in American securities for TO sell these for gold
when that was required, would make that commodity
and iniuriOusy affect the credit and position
Of the Bank but by investing exclusively in European
stocks, that contingency can never arise.
The operation Of the proposed State Bank will gradu
ally supersedo and extnguish the whole OF the
vertbe currency including both bank notes and Green
backs In this way the nation will naturally gradually
return TO Specie Payments without any sudden check
and without fixing any definite period. Instead OF
sT50OO0OOO OF deprecated currency, shall have cur
rency much more extended, and such can never be
deprecated.
The Banks will be great gamers by the change
At present they bound TO hold American
State bonds against their issues that their profits
upon these issues must be very small By the resump.
ton Of cash payments the value OF state bonds will be
greatly enhanced for tho State bonds may then DO ex.
peoed to 90 to premium, which will materially increase
the profits OF the Banks.
The depreciation Of the currency being at present up
ward OF 80 per cent, IL follows that when specie pay
ments resumed In the manner have ventured 70
suggest the wealth and income OF the nation will be in
creased onethird and such is the bright prospect which
the present proposal holds out.
II 1t be replied that there may be difficulty IN finding
the necessary quantity OF gold that there is no
fear Of that When the Bank OF England falls short OF
gold that arises not from the supply at hand
but from the want OF the to purchase IT, The
English Bank is commercial establishment; and when
is high, the Directors induced to lend ont
their funds too freely that they may pay large diy
dends to their shareholders and In this way they are
unable to add to their stock OF gold when time of pres.
sure That contingency, however can never han.
pen the proposed State Bank OF America as IL Will
have funds to lend OUT and dividends to pay 10
shareholders. The State Bank will always have ample
means at her command to buy gold the full amount OF
her notes in circulation.
The present system OF suspended cash payments has
been found TO be most preudcia to the best interests OF
the country and, until II is abolished, permanent re-
yyal OF trade and prosperity Is to be expected and the
sooner return TO cash payments Is made tho better
Tho profits OF the state Bank will be very considerable
hIe4 NIL ~ PWagg the gedueLep VI taxAQR. ThleR u