New-York tribune., 1874-09-07
Marquette Lake Superior, Mich, Sept. l, 1874.

case must be the TRUTH Magma est reras ct pre1aiebW
SAMUEL p. ELY.
Marquette, Lake Slpsrior Mich, Sept. l, 1874.
STEPS TOWARD SPECIE PAYMENTS.
DEFECTS OF THE PRESENT CURRENCY SYSTEM
CHANGES PROPOSED.
TO the Editor Of The Tribune.
SIR: The paper money authorized by Con-
gress consists of two based upon value aud
three based uponfaith OF that based upon coin yaluo
we have rst United gold certificates IN denom-
nations not than s2o and redeemed In gold coin on
demand. by the Government II may be issued without
limit in exchange for gold coin and bullion, ana In pay
ment OF upon the public debt provided that
not exceeding cent beyond the amount Of coin In
the Treasury shall any time be outstanding Authority
should be given to this paper n all denominations
from five cents upwards Ii should be made receivable
for all dues to and from the Government IL should DO
legal tender in payment Of all duties except such as arc
expressly made payable In coin or some other specnc
thing of value" should be fundable into interest
bearing United States bonds at the pleasure OF the
holder the Government reserving the right TO redeem
them in coin lieu OF issuing such bonds the rate OF
interest and condition Of payment OF such bonds always
10 be such that they would stand upon the market at
about par in coin, rie under rather than over par
Then change coin that not loss than % per
cent Of coin upon amount OF notes outstanding shan
at all in Treasury When falls below that
nav interes-any rate necessaryupon deposits OF coin
to keep the reserve good.
The other based upon coin value one class OF
the National bank notes. These may be issued III all
denominations from 81 upward. They are redeemablo
in coin on demand by the bank issuing them. They
may be issued without limit the amount but only
upon the pledge OF the proper securities. and upon COM
plying with the terms and conditions or the law There
are serious objections TO this ISSUE The best thing to
do with it is to abolish It, But It to become Part
permanent OF the country there should DO
q revision OF the law In reference 10 it, Among other
things each bank should be required to put dollar In
United States bonds for dollar IN paper issue. and in
addition thereto a coin redemption fund, to be kept
good of not less than the Government holds for sim
| lar purpose, 90 per cent
or that based upon faith have first United States
legal tender notes These issued In denominations
of 81 and upwards They rredeemable aud yet they
the primary element OF our currency, and by law
| were forced into by the Government as money.
They deprecated in value at time so that It took
SS of the paper tO buy 500 III con and they have APP
proxmated the value of coin that slO2 OF paper
would purchase 500 in coin Between theae extremes
they uctuated since their issue now over IL years.
standing about sllO in paper 10 500 liz coin the
siohs for retiring 100000 The thing be done with
this issue is TO place IL az par with com instantly ana
mantaint This should be done by recei.nS them
for all Government dues duties inclusive. and by Civ
ing holders the right 10 fund 1t into 1910 five per cent
bonds at pleasure the Government reserying the right
20 it with coin In lieu OF issuing the bonds ia
order to prevent the paper from advancing in value
| beyond coin.
As these bonds above par in course the
would instantly advance 10 par Then II they are
wanted circulate money, they Will neither be
funded presented for redemption IN coin TIE Gov
quired for redemption, IL it could get premium Oh
them, and If not, It would give the bonds in exchange
for To obviate all objections In regard 10
duciug the volume OF the currency give these notes
change dollar for dollar for any interest bearing United
States bonds. II the public want this KIND OF paper
money let them it give them 81 oO even
s50000O0 OF IL on the above terms II they want IT. Tho
Government stand IT, II its creditors can. IL the
creditors OF the Government desire obligation
interest lieu OF with interest repeat IL, the
slightest difficulty about too much money. If Is
wanted it VIII not be taken aud II perchanee too much
is taken. the moment Is discovered IL will be funded
The result would be that this Issue would ultimately
| The second issue based upon faith is the Unlted
States fractional currency The authorized issue Of ths
tender notes. IL should be made exactly the same In all
respects except denomination aud then he treated Ia
the same way. There Is none too much OF this, and
until issue redeemabe In coin demand takes
s place nearly the whole amounb would DO required Tor
actual circulation Furnish this, without limit as 10 the
amount, exchange, dollar for dollar, for interest
bearing United States bonds, making IL fIndaOe the
| same as the legaLtender notes.
The third aud based upon faith the other
class OF National bank notes. There are issues all do
nominations from 81 upward They are redeemable IA
legal tender notes. and may be issued without limit
the amount but only upon the pledge Of the paper
curities aud upon complying with the terms and cond
mons OF the Bank act. The same objection that be
urged bank notes redeemabe in coin demand and
Others apply 10 this issue They are unJusnlbe mex,
cusable, and nGeensibe, and should DC retired and
abolished. But II they to be continued, treat them
exactly do the legal tender notes. receiving them
for all Government dues, make them legal tender and
fundable the United states legal tender notes.
so far as the public h eonce.ned make them in every
respect like the United States notes, with ths
| exception, the Government should never pay
out one dollar OF them Relieve the banks from redeem
Ing except from the Government and require them ~
warrant Government in thus 9king then also
bank 10 redeem IN coin from the Govern
ment This ought result IN driving everything in
tina way paper OUT OF existence except United
states notes, redeemabe In coin ON demand-that -,
the issue considered in TINS articeand then Of
that issue supply the banks with all they want, upon
tue pledge of dollar IN UDted States inttrestbearng
the paper money pat also coin redemption fund
OF 20 per aud keep II good Each bank TO be held
duty by having the notes t takes bear specific
number still better, make the currency all alike aud
hold each bank 10 takes OF It's rata Ia either
the 10 be unit 30 far the pubic Is CON
oerned. The Government alone being the Iedeenlus
party, redemption would be- merely abolished; noOody
home trade wonld present the paper Tor coin redemP
toD because for every home purpose the paper wouo
Ia foreign trade coin might be wanted but will tako
not less than $OOOO0Oo0 OF this paper 20 supply tho
wants OF the country currency purposes. and TINS
will he sca tered throughout the county aud before IL
can get out, the Government must have at least
slg0 o0 600 I'M eoin-ii probably would have $50 00O
Tbe moment the reserve runs below the standard
reserve OF 20 per cent hank that has taken cur
renoy will become debtor 10 the Government 10 keep
the reserve good And besides, the Government would
20 keep up the paper reserve, beginning with one per
cent per annum and paying two per month raner
than allow the paper 10 fall In value below coin.
NeU.iork, Aug %, lS1i MERcAroR