Belmont chronicle. [volume] (St. Clairsville, Ohio) 1855-1973, 1873-10-16
The Prestdent's Views on the
Financial Situation


81 WAsHINGToN, Oet. 1.-The view
Eof President Grant on the fiuancis
lquestioa were exposed in substance
yesterday, during . couvensaiion. i
!the first place. he fhoaght The pani
-lgeneraiiy through the country differs
{ essentially both In cause and effect from
any similar event Of which he ha
, known. When such events have here
. tofore taken place distrust has been oe
casionel as to the currency in eireuls
! ton. Everyone in possession of cur
rency would rush to the banks With
!, or spend it in the most liberal manner
, but now the currency, instead of beinI
\ deprecated, is actually becoming dali.
more valuable. In response to inquir.
he said he thought he saw in passing
ieyents the first steps toward resuffip
ton, for the reason that panics gener
laIly occur when the country lacks pros
lperity, such as from the failure of crops
toverpurchases from abroad, DC. In thi
instance the panic has occurred in th'
midst Of the greatest general prosper
lity. The aid recently rendered .in thu
purchase of an unusually large numbel
of bonds was not so much real as moral
The fact is, the President said, the
money corporations Of the country had
become stampeded, and in turn startl
ed and stampeded the whole country
Had not the Treasury seemed to aid
them in some way. the fright would
have become more general and the con-
sequences to the country more fatal. As
it was, he really believed the effect was
going to be beneficial in many ways to
the country at large, though the cost
to some individuals deserving of bet
ter fate may be serious. A return to a
specie basis can never be effected ex-
|cept by shrinkage of values. This
Isbrinkage has How taken place. Dis.
|ssters to individuals have already over
taken them, and he sincerely hoped
the advantage might be retained, in
order to reach the solid financial basis.
Already currency has appreciated to
about par with silver. He wondered
that silver Is not now pouring OUT
When this should take place his theory
was that the country could absorb from
two to three hundred millions of it.
This would prove a great benefit in
several ways. 1t would.supply a mar
ket for number of years for the pro-
duct of our mines, now becoming a
drug. 1t would take place of forty
millions Of fractional currency, about
the amount that experience has proven
to be necessary for the transaction of
business, and will become the currency
which will be boarded in small amounts
He believed that silver, once more in
circulation, greenbacks would never be
at discount for silver. All fluctuations
from that point would be in apprecia-
tion of the value of our paper money.
As to legislation, the President said
he had thought much upon the subject,
and If he were now engaged in writing
his annual message to Congress, he
should recommend the positive author
ity to reissue the forty-four millions
reserve; free banking law, with the
same protection to bill holders as now;
a repeal of the clause requiring a re-
serve for the protection Of depositors;
a percentage Of other reserve to be kept
in gold, and that increased in regular
ratio until the whole reserve would be
in gold. This could be solely effected
by requiring such Institutions to save
the whole, or large percentage of gold
interest paid to banks on their. bonds
held by the Treasurer of the United
States for the protection of bill holders.
He also favored an absolute prohibition
to the payment of interest on deposits.
The President did not contend that
he wonld be tight in these recolnmen-
but they embodied the views to
which careful examination had brought
him. There was no question but that
much demoralizing and injurious specu-
lation and gambling were caused by
the accumulation of capital in large
centers by the payment of interest on
during a portion of the year,
when money is not required for NOV
ing produce. This leads the country
merchants, and Others of de-
posit in city banks, principally in New
York, to make this money earn some
thing during the period when they do
not wish to use it. Banks paying in
terest on deposits cannot afford to hold
money idle; hence gambling in fancy
stocks, millions of which as an invest
ment would not support family even
in the most economical manner, the
of railroads that are not want
ed, and which cannot for years to come
pay the running expenses, etc. Such
gambling and speculation had, heI
received a blow from which
they never would recover. = t.4i ~
The President said that unless his
mind should undergo change, hel
would recommend a Postoffice Bank.
This would give an institution i'm which
everybody would have great confidence
within the reach of everyone who can
money order postoffice. He
should recommend the payment of
per cent. to depositors and the CONVEX
sion Of deposits either into outstandingl
United States bonds or into new 41 per
cent. bonds, and the taking up of a cor
amount of those outstand-
ing. e-i -#3li.# u...- .s.t 50
The President having been asked q
in relation to the Chief JUSTICE