The Rutland daily globe. [volume] (Rutland, Vt.) 1873-1877, 1873-10-15

rue Of the average Of the year, lthe
,pecic--gold and silver--held by the sew.
raj banks ranged from less than three
per cent. to O trhe over seven per cent.
Of their circulation There were two cx-
ccptions to this that particular morning,
but the average throughout the year OF all
the banks showed that from less than
three to trihc over seven per cent. of
specie in proportion to their circulation
was kept on hand in the banks for the re-
dcmption of this same circulation.
Surprising, for instance, some one, on
the morning of July LIST, 1860, had walked |
into the Lamoillc County Bank, at Hyde |
Park, with ten thousand dollars of their |
bills and demanded the gold thereon, what
would have been the result? The bills
could doubtless have been secured, as their
circulation was over sixty thousand dollars,
and yet they had only three thousand,
eight hundred, fortv-scycn dollars and sew
enty-cight cents in specie, both gold and
silver, with which TO redeem the same.
The demand might have been legitimate or
not, but the result would have been TO have
compelled the bank to suspend. 1t WAS,
nevertheless, sound bank, and paid divi-
dcnds during tho year Of nine per cent. on
its capital, and had handsome surplus
left. This is not an exceptional case, aud
we have selected it only because its pro-
portion of specie to circulation was larger
than that of thrcc-quaiters of the banks IN
the state. The Bank of Rutland would
have been in the same condition, because,
with their average circulation as heretofore
given, their average amount Of specie was
only seven thousand two hundred and
thirty-ninc dollars and ninety cents, or be-
tween three and four per cent. OF their cir
culatiou. Yet all of the banks had as
much, If not more, specie than they nctu-
ally needed. The bills q Vermont banks
were at par all over the country, and, at
times. would command a premium in some
parts of the west. The average circulation
of all the banks in the state, for that year,
was 1885,, 1850, while the average
amount of gold and silver they had to re-
deem it with was SlG9, 60554. The specie
was, in reality kept as matter Of form,
and was, in effect, taking so much out of
the capital Of the bank. But for the idea
of keeping this small proportion on hand,
so much money might have been loaned to
their customers, and the bank and public
receive corresponding benefit therefrom.
No one asked for gold, because no one
wanted gold. II was matter of conf
dence between the bank and people, that
| they would redeem their bills-not neces-
sariy in specie, but in something that
could be used current for money. We
doubt not the same is true in reference to
''grconbacks.." The national banking law
requires that their promises to pay shall be
redeemed in ''greenbacks," but we doubt
whether there is a bank in this country
that could SO redeem a proportionatc per
cent. of their issue Their bills are Just
as good, if not better, than greenbacks,
because there is that same confidence. The
same law Of confidence applies in this case
as in the other. Confidence sustains them
as it should. Everyone knows that theil
bills arc good beyond contingency, and
therefore, receive them without the thought
of redemption, and, probably, the mass OF
people without knowing that they are ac-
tually secured.
A 1.-THE Of this confidence would restore
specie payment, so called, in thirty days.
Horace Greeley used to say the way to re.
sumo was TO resume, which is equally good
and bad doctrine. The general government
or the banks, could not resume specie pay.
ment without some preparation therefor
but the minute the general government
under the direction of Congress, returns tt
a specie basis for ii will be an actual pay
ment Of gold and silver with thcm-ths
banks will be compelled to become nomin
ally specie paying, instead Of as now
nominally legal tender paying The great
bugbear, hitherto in the way, has been tina,
values would be SO depressed as to EN-
barrass all business, prccipitatca panic ant
produce general commercial and financial
disaster. Is this true in fact? Specie Ii
now simply a commodity and dealt in al
are corn, cotton, potashcs, potatoes, etc
1t is now quoted alta fraction ever eight
per cent premium, being seven per CEN
less than ii was year ago, and ten PEI
cent less than four months ago. Did finan
cial and commercial disaster follow in tn,
wake of this appreciation of values Tn,
panic, ii will be borne in mind, was dis
connected with the rise or fall of gold.
fall of eight per cent more, or ihercabouts
would place gold, grecnbacks, and nationa
bank bills upon par. Being now a com
modify, it is like all other commodities
and its mercantile value affected by tn,
supply and demand. Natural causes ma,
come into TO help the depreciation of til,
price because the demand therefor il pecu
liar and limited to certain localities. Som
millions of dollars in gold was shipped
from England to this country, Saturday
and the balance OF trade being IN Our favor
and there being, also, a profit in the ship
ment of gold here in payment for grain
the probability is that it will continue t,
flow in. Its tendency will be, of course
TO increase the supply, and. thereby, Jesse,
the understandable value. IT, at the sam
time, the Secretary of the Treasury shoul'
commence the sale Of surplus gold, it woulV
still further lessen the premium; and on
newspaper goes so far as to say that
would sell at par. If So it will not renal
there long, unless Congress-w which will b
in session in little over month-shal
seize the golden opportunity and resume
, If, by the influx Of gold, its premium
should go down TO within two or tire
cents of its face yalue the Same onno,tun