New-York tribune., 1869-01-05
THE NATIONAL FINANCES.
Mg. GEORGE opDYKE on CURRENCY AND
RESUMPTION.

NEW York, Jan. 2. 1862
THE Hon. Roscoe CoNKLING.-Dear Sir;
Again avang myself Of the standing privilege You have
accorded me- herewith submit for your consideration
few thoughts the present aspect OF our national
finances.
Since last addressed you on this subject Admin.
straon has been elected virtually pledged to the fol-
lowing financial policy:
First: That specie payments shall re resumed at the
earliest period consistent with the heaithiul ACTIVITY OF
second That the bonded Indebtedness @ the Govern
ment shall be paid in coin or IT'S equivalent
Third That official corruption shall be suppressed and
strict economy observed IN all departments Of the Gov
Fourfl That taxes shall be cgutaby distributed and
limited 10 such rates as SHAH snthce 20 pay lhe cIet
expenses o tho Government and accrune interest the
public debt, together with small annual nsallment OF
This though spt the letter, isceay tho spirit Of the
financial platfoAn which the dominant party stood at
the Iate & eleot9h i, o, Congress- to decide pnon
ne proper ue and the best meas cf returning 70 specie
payments This Is the great financial problem OF the day
No one moro strongly desires the earliest return. con
sistent with the pablo good TO sound convertible cur
rency. But must again express to you my conviction
that all efforts to that end by immediate early
resumption prove abortve Our currency yet TOO
redundant to attempt with any hope OF success We
have today circulating medium, exclusive OF bank de-
posts Of not less than Sl 10 one ne Of p0pnamio m I4s 10
cent Ia excess Of what the natural laws Of trade viii per
unit OF such currency, as VIII proceed TO show.
tOsay that deposits In bank constitute part or the CIR
cncctualy coin bank notes, and more checiualy
than either They are usually employed in cOnsunina-
ung the lrgcr wholesale transactions of commerce.
while and notes used IN rCtal transactions Aud
retail iOns simply the resale OF cOmnodl
thai have been first sold by wholesale dealers. u lo
lows it there Is about equal amount OF money ust0
each ~ these forms. IN other words, the gross
amount Of naus deposits are always about equal to Tie
grtss amount " circulating notes ana coin. MY oily Ob
irCt FOR Omittiig them in NY estimate Is to Simplify the
discussion Of subject that Is intricate enough WITHOUT
that useless addition
The principle, natural law, that governs the volume
OF circulating medium, consisting OF com alone. is this
lt bc neither nor less than Is sufficient TO eject
the exchange Ofa other property in search OF market
the principle OF true eqtr0fes equal cost OF pro
uCtiOu. This is the point 10 which Its volume over tends
When tcmpO' ariiy driven fOm it by variations the
supply ana demand, principles. which | have already
noticed. start INTO activity 10 bring II back.
circulating medium consisting OF coin ana con-
Yerbie paper subject TO the law, and Of pre-
csely the volume IL IL consisted OF com alone
that This assertion - not u haruony WIN lho
general belief; IL Is nevertheless This is obNi-
from the fact that in mixed currency or CON ana
convertible paper the purchasing power, or value IN eN-
change OF the coined dollar greater than that OF the
paper dollar.
yerble paper not subject TO the principles when con-
troll metallic mixed currency Its volume is gov
erned by natural law, but by statistic law or the
subyerSiOn Of all law by chance. Consequently its vol
depends merely upon the necessities or the caprice
of the Government Issuing 1t or authorizing It's issue In
Buenos Ayres they have issued much that 1t exchanges
for coin al the rate OF % FOL l.
Having shown that the natural laws OF trade determine
tho quality OF convertible paper that can be Kept IN crc
latOn without losing its quality OF cOnNertpty III re-
mains TO ascertain what that quality actually Is
From 1884 to 1862 inclusive the population ana tho Dang
circulation OF the United States have been IN round num-