New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1875-04-21
STATE or THE CURRENCY.


the paper money has undergone during the last
six months. under tho acts of June 20, 1874,
and Jan. II, 1875, arc very curious. AZ this
matter of the currency il important in itself.
and certain to come up again when Congress
meets. we shall try TO throw some light on the
practical workings of the laws referred to-,
taking IA starting point the LIST of Novem-
Der, 1874. the date to which the statistics in
the last annual report of the Controller of the
Currency arr brought down. AS the calcula-
tons required are somewhat intricate, we shall
confine ourselves to a statement in round num-
bers OF results
Firstly, as to the amount OF the contraction.
According to the best estimate we can make
the Treasurer holds six million dollars moro III
legal tender notes, deposited for the purpose
of retiring bank circulation, than he held six
months ago. There has been a direct con-
traction of legal tenders to the amount OF
eighty per cent of the new bank circulation
issued. being nearly three million dollars up
TO the LIST of this month. Finally, there are
two and Orc-half million dollars less OF bank
notes outstanding than there were at the be-
ginning of November. The aggregate OF these
amounts is eleven and One-half million dol
lars. constituting an absolute, unqualified con-
traction Of the paper money to that extent.
Tn REGARD TO the first mentioned sum of six
million dollars not a dollar Of it can be put in
circulation until released 10y che redemption
and destruction of bank note, except in
one contingency. 1t may be that the
solvent National banks which have suITen-
dcred their circulation and deposited greenbacks
with which to redeem it, may redepos't bonds,
withdraw the grccnbacks, and resume their
circulation. We arc not aware that anything
of this kind has yet been done, but it may be
done under the laws now in force. Nearly
twenty million dollars have, up to this date
been deposited for the Withdrawal of bank cir
culation, and there appears to be no abatement
of the current in that direction. Last week only
$i91. $40 of additional circulation were issued
TO banks, while $7O3,100 in groenbacks were
deposited by banks for the purpose of retiring
circulation. Ii will be observed that the above
computation of the amount of contraction il
irrespective of the notes held by banks and
not vet issued, and it does not include the
notes which the Controller OF the Currency has
in hand 80 forward TO the banks in place of
mutilatcd and WORKOUT notes DESTROYED.
There il one important aspect Of this question,
however, which We cannot pass over without
notice. On the 1st of November 1874, tho
currency balance in the United States Treasury
was $16,39G,77O. 1t is now barely three mil
lions; so that the paper money released by the
Government since November more than offsets
the contraction produced ~ the operation of
the Currency acts.
Secondly, as to the pcImanencc Of the con-
traction. This is most difficult Question: and
We are unable rs yet TO reach any positive
conclusion. There are plainly two motives
which may influence banks to surrender circu-
lation. In the first place, they may be in need
of money to sustain their credit and supply
their current wants. Their circulation, re-
garded as consisting OF United States bonds
and notes Issued against these securities, il an
asset Immediately available. BY dcpositIns
$S5, 800 in legal tenders, in addition to the
$4,000 already left with the Treasurer
for redemption purposes. taoy Immediately
receive 100000 ia United States bonds,
which at current prices can be sold for fr1r,
$4,000 10 $4,000 in currency. There
being at prcstat upwards OF two ihcll,iul