Nashville union and American. [volume] (Nashville, Tenn.) 1868-1875, 1873-01-17


sacrifices of the public securities and add
fuel to the existing panic. The third mode
| requires no reserve and implies that the
United States will make its financial
| redemption In bond 30 intrinsieal-
ly valuable that it viii be generally at par
Il gold. ~ -
1 do not overlook the fact that resump-
ton by the United States viii test the
strength Of the National Banks and prove
| whether or not they are entitled to the pub
| lie confdeEce, but their present condition
with an aggl egate surplus fund far beyond
the difference between currency and coin,
justifes the conviction that they will merit
the public expectations. With specie re-
| demptien system, the fluctuations OF
their currency will be but the
healthy ebb and flow of commerce.
Redemption then viii become fact, and
will check the tendency of country banks
to employ their currency in Wall street
speculations. AS they may reaeem In coin
or U. s. bank notes, they will have the
benefit Of the alternative redemption pro
vided as to U. S. bank notes, so that the
sacrifice of their securities that so generally
follows specie payment during q panic
can go no farther than the payment OF
their bonds for their notes, par for par.
Again, specie standard will also bring
gold and silver coin into actual use. The
amount now boarded has been variously
estimated, and with that deposited in the
treasury and in circulation in California,
cannot be less than $200,000,0O0. This will
probably take the place Of legal tenders as
bank reserves, and thus add to the volume
of currency. Even if specie payments should
cause a retirement and the funding
of fifty millions United States notes, their
places will be more than filed by the coin
let loose from its present Punishment. l
therefore concluded that the fears OF evil
results from specie standard are greatly
exaggerated; that there will be no contrsc
ton of currency, no disturbance OF real val
ues or suspension of business; but all our
present United States bank notes will pass
as usual in the ordinary exchanges OF life,
increasing the value of all property whether
produced here or abroad, equal to the real
money of the world and with no taint of
dishonor or depreciation tbout it.
Mr. Sherman continued at length, show
ing the obligation and necessity of specie
payments, and how the anticipated evils Of
resumption might be avoided, and said that
among the innumerable schemes proposed
fer resumption, several were practicable,
but a careful consideration of the whole
subject led him to the conclusion that the
simplest and most expsdient measure is to
declare by law that on and after the 1st day
Of January next the United States will re-
deem its notes either in coin or, at the OPP
ton of the Secretary of the Treasury, with
its bonds of convenient denominations bear
ing 5 per cent. interest in coin. 1t
will provide also for the possible
but not probable contingency that
more notes will be presented than
can conveniently be paid in coin. 1t is
founded upon plain equity that if we can
not literally perform our promise by pay
ment in coin we will at least give to the
public creditor, who holds the notes Of the
United States, bond bearing CONNER
sial value equal to gold. If then these
notes are in excess of the wants OF the peo-
pie for a currency, they will be presented
for redemption and ought to be redeemed.
If not, their value will be appreciated
to the gold standard, and this is
specie payment. The notifications Of
the banking act can be properly
postponed until future tim (, when the
practical effect of the specie standard upon
United States notes will test the ability Of
banks to maintain their notes ct par with
United States notes. Whether they should
be relieved from maintaining so large
reserve, and whether there should be one
centre of REDEEM ption, are questions of prac-
tical legislation for the future. The mo-
ment the notes are redeemable in coin, the
banking system ceases to be limited in
the numbers and distribution of banks, and
will stand like all other business pursuits,
open to all who will give the requisite secu-
rityfjr their notes, and will obey their gen.
eral laws.
The Proposed Law.
Mr.. Sherman reported from the Com
mittee on Finance the following substitute
for MI. Buckingham's bill:
Be it enacted, ETC., That ON the first day
of January, 1874, the Secretary of the
Treasury is authorized and required to
pay on demand, at the Office Of the Assist
ant Treasurer in the city Of New York, to
any holder of United States notes to the
amount of $1,000 or any multiple thereof,
in exchange for such notes, an equal
amount of gold coin of the United States,
or in lieu of coin he may at his option give
in exchange for said notes an equal amount
OF coupon registered bonds of the United
States in such form as he may prescribe
in denominations Of fifty dollars or
some multiple Of that sum redeema-
bic in coin of the present standard
value at the pleasure of the United States
ten years from date of their issue, and
bearing interest payable quarterly in such
coin at the rate of per centum per an
mum, and the Secretary Of the Treasury
may reissue the United States notes so re-
ceived, or if they are cancelled
may issue United States notes 10
the same amount either to purchase or re-
deem the public debt or meet the current
payments for public services; and said
bonds and interest thereon shall be exempt
from payment of all taxes or duties Of the
United States as well as from taxation in
any form by or under State, municipal or
local authority, and said bonds shall have
set forth and expressed upon their face the
above specified conditions, and shall, with
their coupons, be made payable at the
Treasury of the United States.
Sec. 2. That from and after the first day
of July next, the limit of the aggregate cir
culati0n of National Banks now prescribed
by law is repealed, and all banks thereafter
organized shall deposit as security for their
circulation notes and bonds of the United
States issued under this act or under the
act entitled an act to authorize the refund
ing Of the national debt approved July IA,
1870.
Sec. 5. That all banking associations
which shall on and after July 1, 1874, re-
turn their circulating notes at such locali-
ties as are now or may be hereafter desig-
mated by law, either in coin or in United
States legal tender notes, shall be exempt
from the requirements under existing law
as to holding a reserve Of lawful money of
the United States: provided, that nothing
herein contained shall authorize any Ma
tional Gold Bank established under the act
entitled an act to provide for the redemp-
ton of the three per cent temporary loan
certificates and for an increase of National
Bank notes, approved July II, 1870, TO re-
deem their circulating notes in any thing but
gold coin of the United States,
Sec. 4. That section G of the act entitled
an act to provide for the redemption oi the
three per cent. temporary loan certificates,
and fer an increase Of the national bank
notes, approved July II, 1870, be and is
hereby repealed.
Sec. 5. That banks without circulation
may be organized under the provisions of
q n of to rrorida rofioD al orrropnv caourad