Alexandria gazette. [volume] (Alexandria, D.C.) 1834-1974, 1876-08-05

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would have five hundred millions oil specie
lucds TO pay two hundred and eighty millions
If notes without contracting their loans 10
their Gus omers IT calling on any private dcotor
| for paymeut. Suspended banks undertaking
! to resume have usually been obliged to collect
| from needy borrowers the means to redeem e2
ces.iyc issues and provide reserves A vagu1
| idea OF distress is, therefore, often assocla'eo
with the process Of resumption, but the condl'
| tious which caused distress lU those former 10
stances do not now exist. The Government
has only to make good its promises and the
| backs can take care Of themselves without dis
tressiug anybody. rbe Government is, there
tore, he sole delinquent. -,
The amount Of the legal tender notes OF the
| United States now outstanding Is less than
$40, 900 600 of dollars OF securities, AND ga,
600 600 dollars Of fractional currency. How
shal the Government make these notes at all
times as good as specie? 1t has to provide IN
reference TO the SUNS which would be k"p' ID
nsc nv he wants of business, central rcser-
voir Of coin adequate to the adjustment OF the
Temporary fluctuations OF International bal
| ancss. aud as q guarantee against transient
draius arti6caly created by panic or by spec,
ua.op. Il has also to provide for payment OF
such fractional currency as may be presented
for redemp ion, and such ccousderabe por
lions of the legal tenders as Individuals, from
time tp time, as may desire to convert for spo
clal use AZ iD order 70 lay by 10 colu tnelr little
stores of money. 49,,
To make the coin 10 the Treasury available
for this reserve, to gradually strengthen ana
enlarge that reserve, and 70 provide TOT SUCH
other exceptional demands for coin "a may
arise does not seem to me to be work OF dill
fculty, if wisely panued. Dlscreetly pursued,
it ought not to cost any sacrifice to the business
of the country Il should tend, on the con
trary, TO revival OF hope and confidence. The
coin 10 the Treasury Oh the 3Oth Of June, To-
Guiding what Is held against coin certificates,
amounted TO nearly seveuty-tUur millions. Inc
cu:rcnl of previous metals which has 1OWed
OUT of our country for eleven years. from July
|, 1865 to June 80, 1876 averaging nearly
seventy-s millions year, was eight hundred
aud thirty tWo millions 10 the whole period OF
which six hundred aud seventeen millions were
inc product of our own mines. 10 amass the
uuiste qualities, by .ntercepting frim the
curren; f wing out of the country, aud by ac-
" during from the stocks which exist abroad
without dis. urbing the equilibrium of foreign
money markets, is a result to b, easily worked
out by practical knowledge and judgment, with
what respect to whatever surplus OF legal ten
dcls The want Of business may fail to keep 10
use, aud gu which, 10 order TO save interest,
will be returned for redemption. They can b.
paid or they eau be funded. Whether they
continue a. currency or be absorbed into tn"
vast mas of securities held as investments Is
merely question OF the rate of interest they
, draw. Evru if they were to remain 10 thslr
present form, md the Government were TO
| agree TO LAY Oil them a rate OF Interest making
, them desirable as Investments they would
cease to circulate aud tax their place with
Government, State, municipal aud other cor
p3late and private bonds, Of which THOUSANDS
of millions exist among Us. In the perfect
ease With which they can be changed from cur
Z rency into investments lies the only danger to
: be guarded against ia the adoption OF general
measures to remove Clearly ascertalned sur
plus, that is the withdrawal Of any which are
. not permanent excess beyond the wants OF
business. Even more mischicv us would be
any measure which affects the public lmaglna
, ton with the fears OF an apprehended scarcity.
la ctmmuuity where credit is so much used,
fluctuations Of values and vlclssltudes ID busl-
, ness are largely caused by temporary beliefs OF
, meG, even before those beliefs conform to as
!. certalncd realities.
The amour: of the necessary currency, at o
given time, caunot be- determined arbitrarily,
and should not be assumed upon conjecture.
= |
and temporary changes. An enlargement OF it
which seemed to be Individual happened at the
bcginnlog Of the civil war by substituted use
Of currency. 1t varies with certain states OF
business; it 1uct yates with considerable Tegu-
!; iarity al different seasons OF the year. In au'
tumu, for instance when buyers of grain and
other agricultural products bcglu their opera
tons. they usually need to borrow capital or
circulating credits by which to make their pur-
chascs, and want these funds ia currency capa-
Die Of being distributed in small sums among
numerous sellers. The i'd iitonaI need Of cur,
reucy at such times is five or more per cent. OF
| the whole volume, aud if a surplus beyond
what is required for ordinary use does not hap
pen to have been on haud at the money cen
tres scarcity of currency ensucs and also
{ stringency iD the loan market.
1t was in reference to such experiences that,
in discussion Of this subject 10 my annual
message to the New York Legislature OF Janu-
AIRY 5 1878, the suggestion was made that the
Federal Government is bouad to redeem every
porlian of its issues which the public do not
, wish to use. Having assumed to mooopolize
the supply of currency and enacted exclusions
against everybody else, it is bound TO furnish
all which the wants of business require. The
system should passVely allow the volume of
circulating credits to ebb and hoW according to
the ev.r.changog wants Of ousiness 1t should
initiate as closely as possible the natural laws
Of trade, which it has superseded by artificial
coutrivances.
And in q similar discussion in my message Of
January +, 1876, it was said THAT resumption
should be effected by such measures as would
keep the aggregate am unt OF the currency
self adjusting during all the process, without
creating at any time 40 artificial scarcity,
and without exciting the public imagination
with alarms which impair confidence, contract
the whole large machinery of credit aDd dis
turb the Datur4l operations of business.
Public economies, official retreuchments
aud wise foance are the means which
the st. Louis convention indicates as pro
vision tor reserves and redemption. The best
resource is reduction of the expenses of the
government below its income, for that imposes
no new charge on the people, 1t, however, the
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