The New York herald. [volume] (New York [N.Y.]) 1840-1920, 1874-03-20
Financial Condition OF Cuba.

The premium on gold at Havana is lis Il
100, and short sight currency exchange on
the United States is 81 to 80. Yet the Span.
iards and their friends in this country have
been telling us all along that the rebellion is
on its last legs and that at worst it is only a
small affair Every one knows that the tinan-
cial diff culties in Cuba are the result of the
instruction. Ii, then, gold continues to go
up higher and higher what other inference
can be drawn than that the rebellion grows more
formidable and that the cost of the war is
enormous? Spaniards, as O matter of course,
put the best face on the damaging fact and
refer to the condition of our finances and cur
rency al the most critical period Of the civil
war in this country. They say, for example,
time to- near 200 per cent, and that it has
never renched with them over 100. Gold
did not remain long at that rate with us,
though there is no comparison in the relative
magnitude of the struggle. Then the exports
OF valuable products from Cuba, though con-
siderably reduced, have continued and have
exceeded the imports Our commerce was
always nearly balanced between exports and
imports before the war, and when cotton, the
largest product Of export, was cut of, the
drain and insufliciency of specie were seri-
ously felt. While gold has remained at pre-
MUM 1t did not continue long very high.
There always was confidence in the currency,
if not in an early resumption of specie pay
ments, because the currency was based upon
the credit of the government. The green
backs we're government promises to pay and
the national bank notes were secured by gov
eminent bonds. 1t is not so with the cur
rency in Cuba. Neither the Spanish nor colo
NAL government is bound to pay or redeem
the notes of the Bank of Havana. The gov
eminent authorizes the issue, it is true, but
the bank alone, which is private corporation,
is responsible. The paid-up capital of the
Bank of Havana is not more we believe,
than five millions of dollars It's circulating
to little short, if any, of hundred millions.
The government, as was said, is not bound
for these notes, nor are they issued in it's
name though it may be indebted to the bank.
Can we wonder, then, that the premium on
gold continues to advance? There has been
sudden rise, lately, and it is said that it was
caused by the fact of the extraordinary issues
of the bank leaking out. II even the insurrec-
ton co'lld be suppressed we do not see how
the Bank of Havana could take up the enor-
nous a mount of its notes or pay it's indebted
ness. The Spanish government is not in
situation to help the bank, nor is it likely that
government would assume the obligations of
the bank under any circumstances. But as
there ii little or no prospect of the insurrec-
ton be ing suppressed gold must continue to
rise. AS consequence bankruptcy appears
to be inevitable. Correspondingy with the
augmented strength and increased activity of
the Gu ban patriots the means and resources of
the Spnniards are declining. If, therefore,
the Cubans can prolong the war-of which
there seems to be little doubt-the financial
difficulties of their enemies will serve them as
much as powder and arms.