Alexandria gazette. [volume] (Alexandria, D.C.) 1834-1974, 1873-10-23
Senator Boutwell, on the Financial
situation.

Senator Boutwell, ON the Financial
Situation.
New YORK, October 81 Tonight Senator
Boutwell, delivered one of the Galaxy course OF
lectures, at the Church of the Disciples. on
finance and the paulc aud It's remedies Mr..
Boutwell, began with question OF bringing the
currency back to the value Of coin. make a
distinction, said he, between resumption OF
specie payment and cuuAzlti of the COM
merca value of paper currency VII h c"ln
The consideration of the latter is more import
ant than the actual resumption of specie pay
ments. which do not look OH as practicable or
desirable-not practicable that the banks should
resume specie payments, but tn" Government, L
EXPECT will, il the banks arc required to redeem
their currency in leg Il tenders or specie. Prac-
tlcally we sh al have rcsulnrd for the country.
The Atlantic cities are passing through. sc
we're financial crisis, and | propose to deal with
some of the causes. First, We have n paper cur
rency of more than 500 O00lO0 1t is not pos.
sble think, to say whether that currency Is III
excess or not. There are those who dtmald
! contraction means o! rcsumng specie pay
men1s and those who demand expansion, IL do,
for the purpose of relieving the country from the
present condition OF thl gs
The suspension of specie Is due to three causes.
| The first, rather the consequence OF the two
which follow is the depreciation OF the credit 81
the country. In 1853 coin bonds Of the United
were worth eightytwo dollars on the hundred,
/ or at discount of Gig htcen or twenty per cent
| and the obligations OF the country were not pay
able in com during the last four years. This has
been rcmcdied as to the interest bearing Oh lSa-
tons They are ut par III this and The chltl Il
nancial countries in Europe, | wish to correct
AN error as to their value. few months ago,
when the French loan Was put upon the market,
| the French five per cent bonds were taken Ill cI-
cess of the amount offered, while ours were sub
! scribed tor in moderate sum. The difference
WAS that their bonds were put into the hands OF
bankers ut 50 or 81 cents on the dollar, and sold
at S4.S5 cents, while ours were sold at LOO cents
on the dollar, and there was An element vi spec.
ulation in theirs which did not enter into ours:
Another circumstance which has contr outcd
to the present condition of things was the excess
of the volnme Of paper over the actual wants VI
| the country. During the war. paper money WAS
| issued in vast quantities. and white no one was
able to state naihema;icaly the law Of relation
between the volume OF paper money that may
be circulated and specie payments maintained,
yet, unquestlonably, there Is Such law: LOU
may carry paper currency to Il certain point, but
beyond that you cannot maintain specie pay
ments. Take our volume OF paper to-day and
| no one can tell whether it is Iii excess vi that
amount
Another reason is the balance Of trade has
been against us largely for many years. We
have not considered the losses during the four
wears of the war. The losses of the cotton crop
| the withdrawal of the North from active pur-
suits millions of men now producing in the
field In all previous experiences the Ialiure OF
banks to maintain specie pay IncEts WAS due to
transient causes but the Inability of the country
10 resume and maintain it to-day is due t. the
exhaustion of the war, followed by the Chicago
| and Boston calamitles b. which millions worth
| of property was swept away.
The present year promises better. France ana
! Austria 90 on Tor years without specie, advanc-
tll1l .luu n
trade between them and other c, untrieS has been
hardly ever against them, while the ba alice OF
trade has been largely against IL ever since the
war.
Another thing to be taken into account is the
| largo succulatluns in gold on Wall street. based
on The actual demand of five millions week for
payment of duties, and the balance is against Us
| on our foreign trade. l maintain II is not posi-
Bile to resume or retain specie Jay ments unit! the
balance of trade is little nothlng against Us,
and have no faith in any scheme Tor rcdcmp-
ton but in q generous, comprehensive puolc
policy by which the IL dustry OF Tie country
Shall be developed its resources multiplied and
| its capacity to supply foreign countries vi. II ar
tices of pr, iductlOn increased, so that the de-
mand of gold to go abroad shall be met by de-
mand of gold to go to US. hope we shsll re-
sumo, and that when We do it shall last for u life
| time
Mr.. Boutwell, then spoke of the benefits pro-
duced by drawing laborers from other countries
| under the system forced upon us, and the IN
crease of wages which follows in Europe, so that
We can produce many Article. ut u corresponding
cost In 1871 and 1872 seventy-Six per cent or
our trade was carried on in tore gn steam vessels
| Last year it was seventy three per cent. He
| next showed how a reduction might be made in
the naval department, naval armanents. except
for coast detences, not beng of any consequence
to the great powers, and the cost may be ten or
twelve instead of twenty millions year to US
BE spoke in favor OF subsidy to enable our
| ship builders to acquire control OF the carrying
trade He condemned the practice OF banks
taking money on deposit and paying Interest on
| it. a merchant giving paper on time lHds II
mature when he knows he has got to pay, but
that given on call natures not BY time, but the
apprehensions of men, and no business Can or
| ought to resist such q practice.
| In September 1863, the banks that made loans
| on call did not dare ask the money. rs they knew
| the men could pot pay. This Is unjust to all
substantial interests OF the country. In the sum
mer sl the money goes TO New York, and is
| used, not by merchants on time but IN specuia-
| ton. Fortunes are suddenly maize. Young
| men speculate, and are tempted to use money
| not belonging to them. and In nearly all doial-
| cations the cause is speculation.
| In his opinion, with the al of the Treasury,
| the demand might be met this year without the
demands caused by the systems of which ne hsd
| spoken. Every one wants their funds when
| there is apprehension Of financial disasters, and
there is none to meet the Legitimate demands OF
trade.
Mr.. Boutwelrs lecture was listened to with
deep attention bya large audience.