The sun. [volume] (New York [N.Y.]) 1833-1916, 1876-02-22
An Easy Way TO Resume.

| greenbaclIs in bonds NJ their market value.
| II in the multitude OF times we have stated
this proposition the types have got mixed
| once or twice, II would not be surprising.
| The opposition TO any plan of redeeming
the greenback or of providing means for
| Its redemption, proceeds upon the pre-
| sumption that people will ut once ask to
have it redeemed in the way prescribed.
Our proposition is designed to meet that
| objection. Now, unless the grcenback is
redccmable in something more valuable
than itself, no holder will want it redeem
cd. Nothing can be palmer than this.
| Thus. II it was proposed in the present
| state of the market to redeem the green
back in gold at the rate of seventy-hve
cents on the dollar, of course nobody
would 20 to have il redeemed. SO, II
the Government offers its bond in re-
| demption of those notes, at a rate OF IN
terest that makes the bond worth no moro
in the market than the note, there is no in
| ducement TO exchange the one Tor the
| other; and then, Of course, nobody will
make the exchange. This Is what ii Is to
| exchange the greenback at its par value
| for Government bond. We propose TO
| fix the interest on the bond at that precise
rate which will make the greenback and the
| bond worth an equivalent sum in the mar
| ket. II might be four and half per cent.
| bond, BRIT might be four per cent. bond.
| Just now the latter would be the nearer in
| its value to the greenback. We say this
| plan would bring us back to specie
payments without q shock This state
ment Is predicated upon the existing
| state of trade, finance, and industry,
| throughout the commercial world. The
condition of things is everywhere excep-
| tonal. Business and trade are everywhere
stagnant. Money is drug. The rate Of
interest is low and still falling
Suppose we passed law to-day making
the greenback redeemable III a four per
cent. bond. Nobody would exchange
his greenbacks for such bond un-
less he had surplus which would
not bring four per cent. interest in
| gold. To what extent does such state
| exist Why, we should all say, to a
very limited extent. The offer then would
create no disturbance in the market.
There is no wild desire to lend money at
four per cent. of that we may be very sure.
And we know there never Is, and is never
likely TO be, any such desire in our mar
kets, except perhaps for very brief periods.
Yet II is nevertheless probable that If
such q law rs we suggest were passed next
week, there would begin very slight
movement Of conversion, touching large,
! ale denominations of very cautious men.
| But the movement would be so slow and
| so limited rs not to produce any visible eff
| feet on the money market; and II il 10
affect it in the direction Of n stringency,
hat very effect would arrest the proceed
ing No conversion would 20 on, except
/ that based upon desire to get four per
cent interest for money. And thus salu-
| tary and conservative restraint would be
all the time eXerted against any undue
action, against any movement In fact that
would be perceptible in the ordinary chan
pels Of business.
! 1t is asked how, IL the movement would
| be so limited and harmless, 1t could take
us onward to resumptioni Our reply is
| this: First, it would anchor us where we
| are. 1t would arrest the rse of gold. III
| the greenbacks were redcemable in n four
per cent bond of course this would put
| limit 10 the fall in their value, aud the rise
| in gold would be limited IN the same way.
| This would be an immense advantage of
itself. People would nj once know what
they were dealing in A greenback and
bank note would then have specific,
unchanging meaning ana value, which is
what they have not now. If the plan
would do nothing but stop the fluctuations
in the price of gold by combining them to
the variations in the market value, in
London and New York, of the proposed
four per cent. gold bond, il would still be
of inestimable value; and we do not be-
lieve there is an intelligent banker in Wall
street VINO will disagree with US on this
head
But We contend that the plan will not
only steady the price OF gold, but will
gradually sink it in our markets. This
would be the tendency of merely re-
moving ii from the sphere of idle and god
less speculation, like the notorious Black
Friday operation, for example, When Ii
ceased TO be an article of speculation II
would be let alone, except for legitimate
trading purposes. The gold market being
steady, the greonback would take on the
same quality. The calculations OF business
men would be again reduced to their nat
ural sphere. A man could then embark In
HcM chNNl pllsc uIlu NOV i0oii no hN N"Ns
now, that freak in Congress or COM
binaiion of spectators may be able to
ruin the best laid plans, or Illustrate the
wisost schemes.
= This, we say, would be n decided step to-
ward solidifying our money affairs, and
r thus heading the country in the right dreo-
0 tion, We should feel that we were at las
| on holding ground. II not on hard pam We
l could Mt least measure the exact depth
| | down to II.
! Such is the certain advantage of tho
\ plan Of redemption we advocate. If Il
10 did not reduce the volume of paper
10 money a dollar, 1t would at least do
s the good we specify, which of Itself IS am