The daily dispatch. [volume] (Richmond [Va.]) 1850-1884, 1874-03-19
THE CURRENCY QUESTION:
EsrcoND LETT Err from HON r. N. T.
~ HUNTER pF yIaGlNIAsTo
SENATOR STEVENSON

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Hon John ". Stevenson, United States Sc.
nate, Washington, d. O. g.: -
Il Is perhaps not surprising that the cur
rency question has become that of CHIEF m
terest to the nation Just at this time. The
recent crisis IN money +nffairs, wf1ich seems
TO have disturbed the pleasant dreams OF
nrosnerity in which the nation was lnduIg-
ing at the time, occurred so unexpectedly
| that our people were alarmed, and are max
ING anxious inquiry to see if some scheme
NAV not be discovered to prevent the
recurrence of such disasters for the lu-
ture. If there be any mode to pre-
| vent absolutely overtrading ana an
| nnd1e EXPANSION of business u Das
not vet been discovered. Credit, like the IN
flammable gases, owing to its great expansi-
billty and capacity for iniltion, is always
the subject of danger, and no civilized ma
ton seems to have escaped an explosion az
some period of its history. We may WED
| draw the Government as stimulating agent,
| and cut off some Of the usual artlfcial CAUSES
of such disasters. But more we nave nU'
vet learned to do. The attempt 20 suoss,,
tute credit for specie, the only reui inu nI;.
of the world, seems only TO nave ct tn,ns.
Gated the difficulty. The proo'emm W . a,"
muting metals is yet unsoiVea. Ane The
magisferium" is as far to seek Us eNsi' ~
promise to pay specie on ceu s,,uao IpG ~,
which most paper currency - lounae =.
time of trial proves TO De ueiun s,,;,,i Hn oS
neither specie nor always lne equ'sa a 49, ",
specie. wien bank paper Is Daseu u t,,,a
.lio d.o IL never redeemed in times of panic
SSh hos heen the experience in this coun-
| tur. o,cb TOO. has been that of England.
II 17a7 the British Government issued
tho celebrated order in council releasing the
hank from its obligation TO pay specie, which
order was approved by Parliament, and sus-
tanned for the most part by public opinion.
Even the present Bank Of England, organized
under Peel's celebrated bill, and which it was
said would never fail to redeem its promises
to pay specie, had to seek protection from the
Government in 1917, and was released from
its pledge for q time, which it had become
unable TO fulfill. This, although the bank
was at that time perhaps the central institu-
ton of credit in tue world, and was sus-
tanned by all the support derivable from that
fact. This measure, 1t Is said, relieved
that panic, great as it was, and proved the
existence of an artificial striuyency in the
money market, arising from the appre-
hended inability of that institution to perform
its promise, which was greater than any pro-
duced from natural causes. Ii we are TO
have paper currency in this country-and
almost all minds here seem determined upon
tive must look for some foundation TO rest
1t on, other than the promise to pay specie
on demand-a promise which, instead OF
serving to relieve the people IN time ct panic,
serves only to aggraTate its evils. Is there
no mode of issuing 4 paper founded on The
highest of all forms Of credit, that OF the
National Government, which may be equ!Ya-
lent to specie in value for the most part, and
serve all the purposes of domestic exchange,
even when the foreign exchanges turn against
US temporarily, aud produce disturbance
in our relations with the markets or the
world? think there ia, and shall proceed 10
state at once the principles upon which. III
my opinion, this currency should rest. Let
certain amount OF this currency be issued,
to be determined by Congress in its dlSere-
ton, not in addition to tho currency now III
circulation, but as :! substitute at least for an
equivalent amount. Let this csftTency be
convertible at the pleasure Uf the holder into
United States bond Of fixed denomination.
at a rate Of interest payable in specie, and
when the bond is reconyerted into notes
again, or annually, if not sooner reconverted.
When the bond is given, certificate of de-
post to be issued to the owner, who shall
present it when he wishes to reconyert the
bonds into notes or into specie, after CIV
iug'a years notice Of his intention to
demand specie in payment. These GER
tlficates may readily become the medium
of exchange between distant parts of
the Union bearing interest as they
do, these certificates will probably become
the favorite medium of exchange. All taxes
and customs should be receivable one-haf in
these notes and one-half in specie. Salaries
should be paid In the same way. AS soon as
it can be conveniently done, tho whole field
of circulation for paper currency should be
secured to these notes. II not issued in TOO
great quantities, which there can be no pos
sible excuse for doing, and if issued in lieu
of paper currency now af1oat, these notes
will be in prime credit, and ever ready
to serve for the domestic exchanges and
the reproductive machinery of commerce.
Specie will become our currency to conduct
our share of the commerce the world, and
when foreign exchanges turn against US we
shall not only have larger supply OF specie
to meet any sudden demand from abroad, but
our domestic industry will be supplied with
fit medium of exchange in the currency here
proposed, and, unembarrassed BY any fear OF
dangerous aud inconvenient complications
arising out of any delusiye promise held out
by the note, will continue its production of
the great staples and articles of export, which
will furnish good and probably sufficient
means for the payment of our foreign debt.
The banks ought to be required to invest one
third of their deposits in such bond as have
mentioned. The interest on this bond should
be fixed annually with great care by the Sec.
rotary Of the Treasury, 80 as to keep the
bond at par with specie, and neither above
nor below it, so far as practicable. If the
rate of interest be so high as to raise the
price Of the bond above specie par too much
of the currency will be funded. If below that
price, not enough will be funded, and the
bond will not act as sufficient check upon
too great an expansion OF the currency, or
indeed give value enough to the mole. Ii
the bond be so arranged as to be worth its
par In specie, then the note, which will be
rated by the bond, will be equal in value to
specie also. 1t may be said that if the growth
OF the country should increase the demand
| for currency there are no means afforded by
| this scheme to secure corresponding ex-
| pansion. It is true that, according to this
arrangement, the sum of the currency would
be fixed arbitrarily by Congress, which
might not always be properly proportioned
| to the wants Of the country. But, under the
| influence of this demand, the quantity Of
| specie currency might increase, and thus
| furnish a growing supply not only to the
FOREIGN hut to the domestic commerce of the