Nashville union and American. [volume] (Nashville, Tenn.) 1868-1875, 1874-06-06
FINANCIAL
A Memorandum from the Pres
ident. -,
Early Resumption and the Per-
manent Substitution Of Gold
and Silver for Small Bills.

manent Substitution Of Gold
and Silver for Small Bills.
The Conditions on which He Fa-
VOrs Free Banking.
WASHINGTON, June 5.-Senator Jones
has obtained the permission Of President
Grant to publish the following memoran-
dunn prepared BY the latter, expressing his
views upon financial questions: -
believe il, says the President, a high
and plain duty to return to specie basis at
the earliest practicable day, not only in
compliance with legislative and party
pledges, but as step indispensable to last
ing national prosperity. ] believe further
that
The Time Has Come
when this can be done, or at least begun,
with less embarrassment to every branch
Of industry than at any future time, after
resort has been had to unstable and tempo
rary expedients to stimulate an unreal
pr6sberit+ and speculation on basis other
than coin as the Recognized medium OF
exchange throughout the Commercial! world.
The particular mode selected 10 bring
about the restoration Of the specie stand
ard is not of so much consequence as
that some inadequate plan be de-
vised. q tifite fixed when the
currency shall be exehanSeable for
coin at par, and the plan adopted rigidly
adhered to. Il il not probable that any leg
islation suggested by me would prove ac-
ceptable to both branches of Congress, and
indeed, d full discussion might shake my
own faith In the details of any plan l
might proposes / will, however, venture
10 state the general features of action
which seems to me advisable. The finaIl
cial platform on which l would stand, and
any departure from which would be in
spirit of concession and of harmony, and
in reference to conflicting opinions.
First / would like to see
The Legal Tender Cisuse 30 Called
repealed, the repeal to take effect at fu-
ture time, say July /, 1915. This would
cause all contracts made after that date for
wages. sales, etc, to be estimated in coin.
The specie dollar would be the only dollar
known as a measure Of equivalents. When
debts afterwards Contracted were paid in
currency instead Of calling paper dollar q
dollar and quoting gold so much premium,
we should think and speak Of paper as at Sc
much discount. This alone would aid
greatly in bringing the currencies nearer
togetherlat par.
3. / would like to see provision that, al
a fixed day, say July l, 1875, the currency
issued by the United States should be
Redeemed I'm Coin
on presentation to any Assistant Treasurer
and that all currency so redeemed SHOULD
be cancelled and never be reiSsued. To
/ effect this, It would be necessary 70 author
| ize the issue of bonds payable in gold
bearing such interest as would command
par in gold, to be put out by the Treasury
only in such sums as should from time tC
/ time be needed for the purpose
| OF REDEMPTION. Such legislation would In
sure a return to sound financial principles
in two years, and would, in my Judgment
work less hardship to the debtor Interest
than is likely to come from putting of thu
day of final reckoning. 1t must be borne
in mind, too, that the creditor interest haG
its day Of disadvantage also, when our pres
ent financial system was ushered in by the
supreme needs Of the nation at the time.
| | would further provide that from AM
after the date fixed for redemption, M
bills, whether Of National Banks or of tn
United States, returned to the Treasury Il
be exchanged for new bills, should be re
placed by bills Of denomination
Less than Ten Dollars,
and that in one year after resumption al
bills of less than FIVE dollars should b
Withdrawn from circulation, and In TIVE
wears all bills of less than ten dollars shoul,
be withdrawn. The advantage of thi
would be the strength given TO the eountr
against time of depression resulting iron
war, failure Of crops, or by keeping alway
in the hands of the people large suppl.
of the precious metals. With all smalle
transactions conducted in coin, many mil
lions of it would be kept in constant use
and of course prevented frem leaving tn
country.
Undoubtedly poorer currency will a
ways
Drive the Better Ont
of circulation. With paper legal tende
at a discount, gold and silver become a.
ticles of merchandise as much as wheat @
cotton. The surplus will find the bes
market it can. With small bills in circT
lation, there is no use for coin, except
keep it in the vaults of banks to redeeI
the circulation. During periods Of gres
speculation and apparent prosperity, theI
is little demand for coin, and then it flow
out TO the market where it can be made
earn something, which it cannot do Will
lying idle. Gold, like anything else, whe
not needed becomes surplus and
Seeks a Market
where it can 5nd one. By giving actiN
employment to coin, its presence, it seen
to me, will be secured, and the panicS ar
depressions which have occurred period
cally in times of nominal specie payment
ifthey cannot be wholly prevented, can
J least be greatly mitigated Indeed,
question whether it would have bee
: found necessary to depart from the stal
dard of society in the trying days whi'
, gave birth to the first legal tender act, hs
the country taken the ground
= no small bills as early as l65
E Again, would provide AN excess Of re
2 enue over current expenditures. wou
l do this by rigid economy and by taxatiC
where taxation can best be borne.
D Increased Revenue
would work a constant reduction Of q
debt and interest, and would provide co
to meet the demands on the Treasury
the redemption of its notes, thereby dimi
! ishing the amount of bonds needed. f
that purpose all tax after redemption begi
should be paid in coin or United Stat
notes. This would force redemption {
the National banks. trt
With measures like these, or measur
. | which would work out such results, / S
! no danger in authorizing free bankil