The New York herald., 1873-12-03
Our Enhances - -RecommeadasIons of
the IressGent and the Seeretary's

Eep0rfI
When Senator Boutwell, was Secretary of
the Treasury he vas SO tenacious Of his own
perverse policy and so thoroughly its advocate
that the Presidents Message was generally a
document OF secondary Importance. This rule
seems 70 ha reversed under Mr. Richardson's
administration OF the department, for We find
his report second in value and interest 30
General Grants recommendations. The
Presidents discussion of the financial situa-
tiou is curious mixture of sound principles
and unsound deductions. He believes with
the HEEAID that a specie basis alone can
give US sound currency He also be-
lieyes with this journal that we cannot
reach specie basis until our exports
equal our imports; but if hs offers any
suggestion rs 10 the method of Increasing our
exports it is by making the currency elastic.
Put III iuxtaposition there Is in this a mere
confusion OF ideas-;i letting the substance
fall to grasp after the shadow. Had Mr..
Richardson, instead of telling over again the
causes OF the panic-ths payment of interest
on deposits by the banks and the great accu-
mutation of money in Wall street during the
dull months taken up this subject and dis
cussed it wisely and well, the country might
arrive more nearly at the Presidents mean
ing. Evidently the increase of exports is not
to be attained by currency regulations So
long as We continue to buy what We do not
need or what we ought to produce, so long
will our imports exceed our exports. Last
1al, L.
Sil9,5 CAT. Among the items which con-
s.ituts this heavy sum the President mentions
one--the carrying trade remarking that we
pay about $50, 06Q, 900 per annum to for.
eign Vessels for the transportation Of
our surplus products to market, thus
increasing the balance of trade against
us to this amount. 70 this we might add
another item; we pay Spain and Cuba about
1920, 00O coo gold annually for the single arti-
Gle Of sugar An elastic currency will not in
itself build up our mercantile marine or keep
Cuban sugars out Of the American market
The two questions OF the currency and the
balance Of trade must lee separately treated
and though in many respects they are in
timately related to each other we must not
think that even 3 specie basis, desirable as it
is, will cure all the lila from which we are
suffering
After ramarkllg the recurring panics and
str;ngency every autumn as tho result of the
tempting offers Of interest on ''call" loans.
which brings nearly all Che currency Of the
country TO the money centres in dull times
there 70 be used for purposes of speculation.
tue President adds: elasticity IN on,
monetary system, therefore, is the object to
be attained first, and next, 50 that there
may be, as far ~ possible, prevention Of the
nse OF other peoples money and stock and
o.hes species OF speculation To prevent The
hitter il seems to me that one great step would
be taken ny prohibiting the national banks
from paying interest on deposits, by requiring
them ito have their reserves in their own
vaults, and by forcing them into resalmp.ion.
shough it would bc only in legal tendor
uotea" For this purpose he suggests the
establishment Of clearing houses and thinks
it would be advisable 10 authorize the Score
tary ot the Treasury 10 issue, ut any time, 10
national banks OF Issue, any amount u their
notes below liked percentage Of their Issue,
say about forty per cent upon the banks depot
itng with the TreasnSer Of the United States
an amount Of government bonds equal to
tho amount Of notes demanded, the
bsnks 70 forfeit 70 the governnent
say four per cent Of the interest accruing on
the bonds 50 pledged during rho time they
n1nain with thc Treasurer as security for the
increased circulation, the bonds 10 pledged to
be radeenable by the bank. ~ their pleasure,
either in whole or in part, by returning their
own bills for cancellation 70 ON amount equal
to the faco Of the bonds withdrawn. And
this Is about all he does recommend We
rnioha lake IN tisa p-ssid4s,is oronosition that