The New York herald. [volume] (New York [N.Y.]) 1840-1920, 1870-11-19

crease ofpubc confidence II was quito possible that
the currency would not have deprecated a. y did N
ITO were 1t not for the Old manuact0ries OF paper
money In the country, which al THIS time recon-
menced the issue OF great quantities. Of It,. Tney
sent lorth reams OF The colonial bills OF credit with
or without guarantees or redemption. tue same
being received al par with Continental money. 1t
mas been estimated that two hundred millions OF THIS
stun was put in circulation. during the war,
In l71z when the tide Of depreciation set
~, the colonial bills anoat did not ex-
continental money then amounted 10 fourteen NIL
lions, AMI the entire circulation from all sources
specie Icing hidden from vew-was twenty MIL
mons, u sum which formed about one-tenth OF tho
Internal and external trade OF the country, ana
ailowei about seven dollars for every lunaolgant
Subsequent investigation shows that this amount
was as much as could be absorbed by the conntry;
ana y was be ause TINS national limit had been ex-
cecueu tnat depreciation began. Had this glut been
prevented and the amount OF paper Kept precisely
equal to what the aggregate or metallic money would
nave been II no paper money were IN circulation,
the depre cation could not nave occurred Follow
ing these remarks the views of John Adams who was
one oil the nrst 20 discover plan 70 SET the prin
cp,es OF paper currency circulation In clear light,
wal be IN place.
1.-The amount OF ordinary commerce. internal and
external, OF country may DO committed at " liked
SUN. certain amount OF money ~ needed 10 CLIP
culate among society, to enable them To carry on
tlier business. THIS precise sum 10 lscoverable b.
can.uialion ana reduceaDle To certainty. You may
emit paper or amy other currency for your purpose
until you reach this rte, and will not depreciate.
Aitr you exceed the rule IL Will deprecate, and no
power or act OF legislation hitherto invented VIII
prevent II. In the case OF papef. yon go on emit
Ting forever the waole mass will he no more than
that was which WAS emitted within the rule.u Row
Tar Adams was rIgnt Is shown IN the above table,
and 1t may be iairiy inferred that paper money
based on national or dit VIII not depre late except
IL be excessive in quantity. And, indeed, II may
DC safely TAKEN as financial axiom That
THE RATE OF DEPRECIATION
IS usually prop0rtloDed TO the amount OF excess In
the issue. ThrdinicniJy Is tnat tile ainounc oil cur
fency required IN commercial counuies-such as
France ana Germany ior ln5tance-i5 variable
Quantity. Its volume huctuaieS IRON day to day
and depends on the activity OF business, the growth
OF opulence, the state OF the pubic mind in refer
ence 10 government stability and honesty OF pur-
pose, the foreign exchanges and other circumstan-
ces.
IL WIN not be unintercsting IN this connection to
give tie table OF paying rates OF foreign exchange
during the circulation 0f the continental money,
The following viii show how many dollars o: paper
money, IN Computing exchange, were reckoned 10
be equal 10 one dollar In conn.,
TABLE OF THE CURRENT RATES or FOREIGN Ey-
CHANGE At PHILADELPHIA DURING TIE WAR OF
INDEPENDENCE. SHOWING now MuoH PAPER