Green-Mountain freeman. [volume] (Montpelier, Vt.) 1844-1884, 1873-12-03
SPECIE PAYMENTS .

that we can never have permanent prOsperi-
ty until specie basis is reached, and that
specie basis cannot be reached and maintain
ed until our exports, exclusive of gold, pay
for our imports, interest due abroad and
other specie obligations, or SO nearly
to leave an appreciable accumulation Of the
precious metals in the country from the pro-
ducts of our own mines.
The development of the mines of precious
metals during the past year, and The pros
pective development of them for years to
come, are gratifying in their results. Could
one-half of the gold extracted from the mines
be retained at home our advance toward
!, specie payments would be rapid. To in
crease our exports, sufficient currency is re-
, quired to keep all the industries Of the coun-
, try employed; without this national ias well
as individual bankruptcy must ensue. IN
due initiation on the other hand, while it
might give temporary relief, would only lead
to initiation of prices, the impossibllty of
competing in our markets for the products
of home skill and labor, and repeated renew
ais Of present experiences. Elasticity of our
circulating medium therefore, and Just
enough of it to transact the legitimate bust
, ness of the country and to keep all industries
employed is what is most to be desired. The
exact medium is specie, the recognized me-
dunn of exchange the world over, that OBJ
tanned we shall have currency of an exact
degree of elasticity.
If there be too much of it for the legiti-
{ mate purposes OF trade and commerce it will
flow out of the country, if too little the re-
,, verse will result. To hold what We have
and to appreciate our currency to that stand
ard is a problem deserving of the most Sc
rous consideration of Congress.
The experience of the present panic has
proven that the currency OF the country,
based as it is upon the credit of the country,
! is the best that has ever been devised. Us
/ ually 10 times of such trials, currency has
become worthless, or SO much deprecated in
value as to initiate the values of all the ncces-
sarles of life, as compared with the currency.
Every one holding it has been anxious to
dispose of it on any terms. Now we witness
the reverse. Holders OF currency hoard 1t as
they did gold in former experiences of like
? nature.
1t is patent to the IN ost casual observer
that much more currency or money is re-
quired to trausact the legitimate trade OF the
country during the fall and winter months
when the vast crops ale being removed than
r during the balance of the year.
With our present system the amount 10
the country remains the same throughout
II the entire year, resulting in an accumulation
OF all the surplus capital of the country in a
: few centres, when not employed in the NOV
4 ing OF the crops, tempted thereby by offer oil
interest on call loans. Interest being paid
c this surplus capital must earn this interest
II paid, with profit.
n Being subject to call, it cannot be loaned
e only in part at best, to the merchant or man
0 utacturer for a fixed term; hence, no matter
e how much currency there might be in the
{ country it would be absorbed, prices keep
= ing pace with the volume and panics, strln.
s gency and disasters would ever be recurring
= with the autumn.
Elasticity IN our monetary system is the
5 object to be obtained first and next to that as
y Tar as as possible, prevention OF the use OF
4 other peoples money in stock and other
d species OF speculation.
g INTEREST ON DEPOSITS.
To prevent the latter it seems to me thai
one great step would be taken by prohibit.
i ing the national banks from paying interest
. on deposits, by requiring them to hold thelI
. reserves IN their own vaults, and by forcing
them into resumption thon5h it would be
Q IN only legal tender notes. For this purpose
h | would suggest the establishment OF clear.
. lighthouses.
U For your consideration to secure the for
mer many plans have been suggested most
1t not all OF which look To me more like in
hAtlon on the one hand, or compelling the
Government on the other to pay intereSI
without corresponding benefits upon the
surplus funds OF the country during tie sea
. sons when otherwise unemployed.
I | submit for your Consideration whether
= this dtthculty might not be overcome by au.
Il thorlzlng the Secretary OF the Treasury t,
y Issue at any time TO the national banks o
u issue any amount of their notes below q
hx-d percentage OF their issue, say II
per cent, upon the banks deposltlng viii
the Treasurer OF the United States All
= amount OF Government Bonds equal to tn,
II amount OF notes demanded, the banks to for.
. feit to the Government, say i per cent o
- the interest accruIng on the bonds So pledg
ed, during the tune they remain with the
!, treasurer as security Tor the increased cir
l. cuIatlon, the bonds 50 pledged to be redccma
,, Die 10y the banks at their pleasure, either il
u the whole OF IN part by returning their OWL
" bills or cancellation to an amount equal t
II the lace OF the bonds Withdrawn.
l would further suggest tor your c0nside
u ration the propriety OF authorizing natIona
} banks to diminish their standing issue a.
= pleasure by returning Tor cancelllt atom then
own bIs and Withdrawing 50 many Unite
- States bonds as are pledged Ter tie bills re
: turned
u In view OF the great actual contraction
that has taken place IN tue currency, anc
the comparative contraction Continually -
y Ins On, due to tAc Increase OF population
x the Increase of manu- lectures and all the in
> dustrles, do not believe that there is to,
y much OF it now for the dullest period of tn,
year
y Indeed, if clearing houses should be cs
tablshed, thus forcing redemption, it is
I question for your consideration whether
- banking should not be made free retainins
y all the safeguards now org ,nIz-d TO secur,
IL bill holders
u In any modification of the present law
regulating National Banks as a iurther stel
. towards preparing Tor the resumption .
! specie payments | invite your attention to
consideration OF the proprIcty Of exactIn.
rom them the retention part Ut theI
reserve either the whole or part of tn
IL gold interest accruing upon the bonds pledg
= ed as security for their issue. | have no
s, reelected enough on the bearing this nigh
of have IN producing scarcity OF coin Wit
3 which to pay duties on Imports, to give /
x my positive recommendation, but your at
al tention is invited to the subject
nj CURRENCY CONTRACTION.
10 Daring the last four years the currenc,
is has BEEN contracted directly by the with
II drawal OF the three per cent. certificates
D. compound interest notes and 7-30 bonds out
standing on the 4th of Marcn, 1869, all 0
I'd which took tue place of legal tenders in tn
e, bank reserves to the extent o. SIXTY tire
i million dollars. Daring the same perio
es there has BEEN much larger comparativ,
lie contraction of the currency
e The population of the country has largel,
E. increased ; more than twenty-five thousan,
a. miles of railroad have beer built, reauirin.
IL the active use of capital to operate them
h millions OF acres of land have been opene,