Eureka daily sentinel. [volume] (Eureka, Nev.) 1871-1887, 1874-09-11
ERRORS.

CURRENCY ERRORS.
Il is a grave error to suppose that
we need more coin than we on an av-
crage possess TO resumc specie pay
ments; and that resumption OIL the l>t
of January of any year would have
proved or will prove, failure. This
idea is based on the superstition that
resumption will lead TO the ~presenta-
ton Of a large portion of the legal
tenders for redemption in coin. In
stead of this being the case. after re-
demption, legal tenders will then take
the place of gold in all the operations
in which gold has interviewed during
suSpensiou-such Is the payment Of
duties on imports and interest on the
Federal, State, municipal and corpora
ton gold bonds, the purchase Of for
eign exchange, and foreign products,
such as coffee, teas. iron, hides, ETC.,
etc. In all these transactions. after re-
sumption, bank checks and legal
tenders will generally be preferred 20
gold. and as the Cold Room is sure 20
close after resumption, no gold reserve
will need to be held for speculative op-
erationS in gold. The only use there
will then be for gold, will be Tor the
liquidation of adverse foreign balances
of trade at those periods when Il eN-
ports of products and commodities are
insufficient for tha; purpose. BIT thiS
erer since tie suspension II specie pay
meats, and the adverse balances OF
trade are sure to he less after re>ump-
ton than they have been during sus-
pension, because everything we pro-
duce will cost less when We Use cur
rency of permanent value, than while
We Use one of f~luctuating value, as the
latter is a great impeachment and bur
den TO productive industry and COM
merce.
That the oft-urged plan Of resumiu-
specie payments by contracting the
currency until it becomes of equal
value with gold would break down
all the industrial interests Of the coun
try" and hence prevent re-
sumtion, is ~self-cvident to all
who have noted the effects
of currency contraction, and 10 al
who comprehend the true functions Of
banks and currency. To advocate
such a measure is evidence of ignor-
ance of the fundamental principles OF
banking and money. As to growing
up to specie payments by the gradual
increase of our population and indus
try, the idea is simply absurd. No in
crease of population or production
will produce tie result. because the
holders Of gold will never part with it
at par so long as there is the slightest
hope of obtaining a premium for il.
1t must be supplied at par by the Fed
eral Governments or by our banks on de-
n.and, before the boarded gold will lie
returned 10 general circulation. and
thus return to par. An increase Of
population and production will require
AN increased quantity of gold. un,es,
something else can ne made to take its
place; while there is every probability
that the annual production OF gold
throughout the world will continue to
decrease as it has been doin. for 0me
years past. But let the Federal Coy
- pr,,apt mako tho lara1 fanlarE com
trovertible into coin on demand, and
reissue them, as taS, as redeemed, for
the disbursements OF the Government
and for the redemption of our public
debt when We have any surplus rev
enue, and thereafter our merchants
will obtain from the United States
Treasury, at par, the gold necessary 10
liquida;e our foreign balance, of trade,
which they now obtain, at a constant
~ varying premium, from the brok-
crs. This new condition of things Will
require MOI. more Gut less goi2 than the
present. The amount Of gold pro-
duced in the country will not be de-
creased, whilst the demand will be
greatly le,,ened, by resumption.
Hence, there is no need whatever OF
increased Accommodations Of gold TO re
sumo specie payments successfully;
and resumption with our present
mixed currency of legal tender, and
national bank notes, will be easier
than under any other circumstances,
deem the latter, thus rendering it
needless for all the National Banks
throughout the United States to hold
reserves of gold, which can then be
concentrated in New York and San
Francisco, whore alone they Nil be
nnaIaI