The sun. [volume] (New York [N.Y.]) 1833-1916, 1876-04-06

4 Suggestion.
A respected correspondent propounds
the idea that the restoration of the rebel
Stntcs after the war, by furnishing n new
field for the circulation of our paper
money, operated very much rs an nbso-
lutte contraction Of the circulating medium
10 the amount that the new district alb
sorhcd.
There IL something in this idea. But
no largo amount was suddenly taken
there. The Impoverished condition Of the
people was slch that they had no means Of
Obtaining money of any kind. For two or
three years they produced barely enough
TO keep soul aud body together. Perhaps
no war ever before left the population
where Il ragged in such absolute aud uni
versal Indulgence. Then IT must be remem-
be.cd that in all those parts of the South
ern country which were held or traversed
by our armies. Northern money was the
only or the chief currency; and it natur-
ally rndiated into adjoining districts, 80
that the restitution of this currency IN the
South in 1s65-CG was by no means absolute
or universal.
II H. WuIlll OuSeINlnHs llONtNtIi lutl ulNtI
the war, gold for some time ranged at
about 40 per cent premium. Until rs late
las January, 1862 It stood at IS. But by
the close of 1870 when We may as
sumo that the South had recovered a con-
siderable degree Of purchasing power, aud
had thus begun to make her demands on
the circulating medium dccisively felt, the
price OF gold had gone down TO 10 per
cent This sudden decline in the price IN
the year 1870 took people generally by sur
prise, and has never been fully accounted
for the reason for il not seeming to be well
understood. Many persons Thought at the
time II would 20 back to the old figures;
but 1t never did. IL may be ,hat the sug-
gcstion Of our correspondent throws light
on the case. The fall in gold, coincidiug
with the time when the paper circulation
had begun TO flow freely into the south,
would seem 10 indicate that its spread
there operated as Il contraction of the
currencv, and that the fail in price was
thus occasioncd. This is at least reasonable
deduct on III harmony with the true laws
Of trade aud Guance.
But instead OF its being reason for lssu-
ing more paper money, and running the
premium on gold back TO IS or 30 per cent,
| ms our correspondent suggests, IL is n
| fruitful intimation to lis to hold on where
we are, rnd he thankful that II happy cir
cuinstauoe, not clearly foIestcn. may have
operated to bring us SO much the nearer
10 Il sound currency. Tho suggestion III
no way bears upon our present situation,
because the fall III gold. which either that
cause or some other produced. took place
three years beior, the panic, and produced
no shock whatever TO the money market
ut the time, nor subsequently,; SO that as
no mischief was done from any point Of
view, there is none to repair
As to getting back TO II SOLID basi-, with
out suspension of our undue activities. aud
without suffering which our coTrespondent
humanely wishes might be done, We are
sorry to say there is no hope OF that, and
there never WAS. The laws % finance ~ e
as iuneXible rs the laws 81 health. II they
are violated, the Consequences are alike
inevitable. We have had our good time
for many years, making heavy drafts
month by month ana year by yelr on
our stock OF financial vitality, I'LL At
length IL is exhausted. We have fed on
touics and stimulants TIL the system has
given way under them. More OF the
same sort will only make the w.ccK more
complete. Wemust go through course of
hospital treatment or we shall never re-
cupclate. As in all cases OF the inevitable,
II is not II matter OF choice, but Of incNo-
! Inblr necessity.