Knoxville journal. [volume] (Knoxville, Iowa) 1874-1986, 1874-06-18
President Grants Views on the Cur
rency Question.

WAsHIN6TOS, June ..
Senator Jones has obtained permission
from President Grant to publish the fol-
lowing memorandum prepared by the
latter, expressing his views upon the
financial question. The President says:
believe it high and plain duty to return
TO a specie basis at the earliest practicable day,
not only in compliance with legislative and
party pledges, but as step indispensable to
lasting national prosperity. i 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 temporary expedients to stimulate unreal
prosperity and speculation on a basis other
than coin, the recognized medium OF ex-
change throughout the commercial world
The particular mode selected to bring about
restoration of the specie standard Is not so
much consequence as that some adequate
plan be devised, time fixed when the cur
rency shall be exchangeable for coin at par,
and plan adopted and rigidiy adhered to
IL Ia not probable that any legislation sug
gested by me would prove acceptable to both
branches OF Congress, and, indeed, full dis
cussion might shake my own faith in the de-
tails Of ally plan might propose.
1 will, however, venture TO state the gen.
eral features of action which seem to me
made advisable, the financial platform on
which would be In spirit OF concession and
harmony In Difference to conflicting opinions:
l. would like to see the legal-tender
clause, so called, repealed the repeal to take
effect at some future time, say July 1, 1875.
This would cause all contracts made after that
date for wages, sales, etc, to be estimated In
coin; II would correct our notions Of values;
the specie dollar would be the only dollar
known as the measure OF equivalents. When
debts afterward contracted were paid in cur
rency, instead OF calling paper dollar dol
lar, and quoting gold ut go much premium,
we should think and speak Of paper as at so
much discount. This alone would aid greatly
In bringing the two currencies nearer together
at par.
q. would like to see provision that at a
fixed day, say July 1, 1876, the currency issued
by the United States should be redeemed In
coin on presentation to any Assistant Treas
urcr, and that all currency so redeemed should
be cancelled and never reissued. To effect this
II would be necessary to authorize the issue
OF bonds payable In gold, bearing such inter.
est rs would command par In gold, to be put
out by the Treasury only In such sums az
should from time to time be needed for the
purpose OF redemption.
Such legislation would insure return ia
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 OH tue uhy VI iitai TtchonluR. III Ilusl
| be borne in mind, too, that the creditor inter
est had its day of disadvantage also when our
present financial system was brought In by the
| the supreme needs OF the nation at the time.
would further provide that from and after
| the date fixed for redemption, no bills
whether of national banks or Of the United
States, returned To the Treasury to be ex.
| changed for new bills, should be replaced by
| bills OF less denomination than ten dollars
and that In one year after resumption all bills
| Of less than five dollars should be withdrawn
| from circulation, and In two years all bills OF
| less than ten dollars should be Withdrawn
The advantage Of this would be the strength
| given to the country against time OF depres
/ sion resulting from war, failure of the crops
| or any other cause, 10y keeping always In the
hands Of the people large supply Of precious
metals. With all the smaller transactions
conducted Ia coin, many millions OF
it would be kept In constant use,
and, OF course, prevented from
leaving the country. Undoubtedly poorer
currency will always drive the better out OF
circulation. With paper legal tender and al
merchandise ss much as wheat or cotton. The
| surplus will find the best market II can. With
| small bills In circulation, there Is no use for
coin except To keep II In the vaults of banks to
redeem circulation. During periods OF
great speculation and apparent prosperity
there Is little demand for coin, and
| then II will flow out to market where It can
be made to earn something, which 1t cannot
| do while lying idle. Gold, like any.
thing else when not needed, becomes sur
plus, and like every other surplus II seeks a
| market where IL can find one. By giving II
| active employment, however, its presence can,
| 1t seems TO me, be secured, and panics and
| depressions which have occurred periodically
| in times Of nominal specie payments, IL they
cannot be wholly prevented, can at least be
| greatly mitigated Indeed, question wheth.
| or Il would have been found necessary to dc.
part from the standard Of specie In the trying
days which gave birth 70 the fret Legal.