The Valley Virginian. [volume] (Staunton, Va.) 1865-1895, 1874-05-21
The Finances.
THE PRESIDENTS vIEws.-sENAToR NOR
TONS EXPLANATIONS.

MS veto message ana the Denenclal effect 1t ma
exerted upon the finances of the country
home and abroad, when the report OF Mr.. Wi
liam Gray of his interview with the Presidel
was made the subject of conversation. Ti
President remarked that Mr.. Gray had give
very correct impression of the interview. a
though it was not expected that it could hay
been reported in the precise language. II
said as to the original legal-tender acts, the
were not now open for consideration, nor eve
criticism that when they were adopted the
lWeresadopted by loyal men for the salvation {
the country, and with them the war had bee
successfully carried through, and it was onl
with that success, and the results growing GU
OF it, that we had any country, or currenc
either, to regulate. This, the President sale
was the point that he himself had uppermos
in his mind, and which he intended to impress
upon Mr.. Gray and those he represented.
On the question of using the reserve for tn
purchase of long bonds, he said that what h
wished particularly to present was the fact a
taxation was then producing revenue in ex
cess of expenditure, and still the national cred
it abroad and at home was not directly strength
ed by that fact, he had fixed upon the policy o
buying, OR, in other words, paying the Ion!
bonds, for the reason that this improved thu
credit of the nation wherever those bonds wer
held, which extended throughout the fnancia
world; and the bonds, moreover, themselves
kwere then overdue in one sense, as they hat
then become payable at the option OF the gov
ernment, and the government having surplus
of revenue this option to pay became lega
obligation.
'sThe President further said that he was in
favor of going further than Mr.. Gray or his
committee had suggested. and it was merely
| following out the same line of policy. He sale
{! the legal tender acts themselves should now bt
repealed; they had worked out their whole Of
I flee; they had carried the country through the
war, and@were no longer necessary, and he
hoped that Congress, during itspresent session,
would repeal all the legal-tender acts such re-
peal to take effect January l, 1875, and that
thereafter all contracts should be made on a
gold basis. He said it would seem that this
could be done without any disturbance of COM
! mercal or financial interests of the country,
and once accomplished, all temptation to infa-
| ton was ended.
s'As to the taking away from New England
the excess of bank circulation, he said that it
| really amounted to nothing. The banks from
the East were now returning their circulation
| and withdrawing their bonds much more rap
idly than there was any demand from the West
and the South for the circulation. He thought
that the figures would show within the past
few months that more than double the circula-
ton had been returned from the East than was
asked for by the South and West. He said
that he did not think the currency bill, if he
lldu SlSlleu IL, WOulu nave III
the present condition of the country, as there
was no demand for additional currency, and
no use for large proportion of what we now
had but the danger was in the future, and it
was a step in the wrong direction, that any in
crease of irredeemable paper would injure vi
tally the national credit, while on the other
hand an unlimited issue of redeemable curren-
cy could do no harm. He was in favor of free
banking, but with it, and as an inseparable ac-
compartment he insisted that we should have
redemption, and he was willing to give to the
West and South free banking based on redemp-
ton, and this he wished and had taken pains
that his friends in those sections should under
stand.
s'The President said he was in constant re-
ceipt of communications from business men,
bankers and public men at the West and South,
expressing on the part Of the writers their orig
nal anxiety for the passage of this bill, or some
similar measure as means OF relief at the pres
emit time, but nearly all of them assured him
that the effect of the message had been to re-
store confidence and give permanence to the
future course of the Government, that was full
ly as great relief ana more Satisfactory TO
business interests.
He further said that while his communica-
tions from New York and the East were al
most all in approval of his course, the action of
the South and West was nearly as unanimous
and from all this he hoped the very best results
to the country, and very likely the benefits
would far exceed the expectations of any one.
The President seemed as decided in reference
to his future action as he had been in the past.
He expressed the greatest kindness to all
parties especially those who might have felt
disappointed at the course which duty had COM
PEELED him to take.
The indianapolis journal of Saturday pub
fishes letter from Senator Morton in relation
to the vetoed currency bill. He denies that the
- tba Q1llis nj
States notes, and says:
A section of the bill fixes the maximum of
United States notes at $400.000.000. By all
act of June 80 1864, it was declared that the
United States notes, in circulation shounld not
exceed $500, 900, 900. On March 4, 1868, an act
was passed forbidding a further reduction of u
nited States notes, the amount then outstand-
ING being 1856, 100000 The difference be-
tween this amount and $400,0O0,000, viz: ST.,
OOO 900. the successive secretaries of the treas
urv and the President have assumed the right
to reissue at their discretion. This right to re-
issue has been denied by many lawyers, in Con-
gress and out OF it.
The first section of the bill, therefore, de-
clares the law to be what the President and
Secretaries have assumed it to be. It was the
wish of the friends of the.bi that the forty four
million reserve should be put in circulation
The other section Of the bill authorizing an in
crease of the bank note circulation to $46, 000,-
600, to be distributed among states having less
than their proportion upon the basis Of the act
of 1866, was the first step that had been taken
toward a resumption of specie payment by
Congress. fFhis amount was thirty millions short
of equalizing the distribution. Under the act OF
1865 the New England States were entitled to
less than forty millions, but received one hum
dred and ten millions, and other eastern States
had an excess of nearly twelve millions.
Most of the friends Of the bill desired the re-
striction taken off as to the amount and locali-
ty of circulation, so that the people should be
left free to establish national banks wherever
and whenever their local necessities demanded
them. That the bill would have produced some
contraction at the stock market in New York
is true, but it is well understood that the re-
serves of the southern and western bonds kept
in New York have been used by New York
banks almost exclusively upon call to dealers
in stocks. and have thus stimulated ali unwhole-
some speculation, and have been of very little
benefit to the mercantile or manufacturing
communities. This bill in effect, required
banks outside of redemption cities to keep three
fourths of their reserve at home, and would
have drawn some millions from the stock mar
ket in New York, which would strengthen the
banks to which they belonged. and would have
produced contraction in quarter where con-
traction would do no harm.
OF this act requiring the United States to
make provision at the earliest practical period
for the redemption Of its notes in coin no one
denied the binding force of that pledge, but
the question as to a practicable period remains
as open as upon the day it was passed. That