National Republican., 1874-04-01
INITIATION OF THE CURREN

INITIATION OF THE CURRENCY
The NATIONAL REPUBLICAN has steadily
opposed initiation of the currency, and ha:
insisted that the best interests of the coun.
try demand gradual but sure return to q
practical specie basis. In order to reach
the latter desirable financial position it has
argued that provision should be made by
Congress for the redemption in coin of the
legal-tender issue at some fixed date in the
future not too remote. 1t has shown that
the probable amount of circulating medium
necessary to the profitable transaction OF
the business of the country does not exceed
the present aggregated volume Of the ma
tional bank and legaltender currency, but
that the question of volume depended so
much upon the activity of its circulation as
to be somewhat difficult of determination.
It has also shown that activity of circulation
is sentirely subordinated TO public confidence.
When the latter is shaken by any sudden
exigency the circulation stops and paralysis
of the industries and exchanges of their
products interyenes. The medium OF ex.
change is locked up until confidence is re-
stored. Consequently money panics are
more likely to occur in redundancy Of the
circulating medium than to result from an
insuficiency, for the reason that confidence
is more frequently destroyed by the burst
ing of those speculative bubbles which are
the offspring of imitation than by any actual
stringency in the money market resulting
from real scarcity of currency.
Redundancy of the circulating medium
in coin would infI:te prices and cheaper
money just as surely as it docs in paper.
In 1852, during the administration Of
Mr.. Buchanan, Government bonds were
largely redeemed at fourteen 70 sixteen pei
cent premium in gold. There is no good
reason why our present five per cents.
should not rise to ten per cent. above par
in gold the moment that the legal tender Is
redeemed in coin, or that the proposed
three-slxty-fve per cents. should not com.
mand premium of five per cent As we
are largely gold-producing country there
is no sound argument that can be made
against the expectation of our surplus OF
that commodity that will not apply with
equal force to all other products of industry.
As gold and silver coin is our legal stand
ard Of value, it is incumbent upon US to
make our paper, which affects to represent
coin, redeemable In it. The only feasible
method which presents itself for efecting
this result is the retention in the Treasury
ofa sufficient portion Of our coin receipts to
enable US to commence redemption on Q
certain specified day in the future. Let
Congress fix that date, and prohibit the
sales Of gold by the Secretary beyond the
legal requirements Of the sinking fund and
the payment of the interest on the public
debt and the legal tenders will at once be-
gin to approach the gold standard If the
date fixed shall be January, 1875, green
backs viii be at par previous to that date.
National bank notes being redeemable in
greenbacks. and fully secured by gold
bearing bonds worth par or q premium in
the markets of the world in coin, viii keep
pace with the legal tender in appreciation
to the coin standard.
II it be true, as the expansionists assure