Marshall County Republican. (Plymouth, Ind.) 1856-1878, 1876-06-01
For the Republican.
Finance.

What shall we say of an "elastic cur
rency," which in times of pressure may
be expanded ito meet the wants of
trade 1t is easy enough to expand or
initiate money; but elasticity implies
the power to recover original dimen-
sions without damage.
No harm may come of retiring part
of the money when not wanted, but the
moment it is known that the volume of
the standard of values is increased, a
general corresponding advance in val
ues, or rather of prices, ensues and
nothing is gained, but immense dam
age is done; because the advance, III
prices resulting, is by no means uni
form, and labor is usually the last COM
modify to advance. Consequently, the
poor man stands the brunt of the shock,
and the elastic" quality to restore the
original level, does not yet appear.
So far as the elastic principle is APP
piled to credit as a part of the vehicle
of exchanges, the bursting of the bub-
BILE of expanded credit is simply the re-
suit of applying the tension thereto to
the exhaustion of its elastic property,
and elastic money socalled would not
repair the breach of bursted credit.
Elasticity is not property of money
considered as standard of values. In
commerce it belongs alone to credit.
There is no impairment of our mon
ey to account for our financial troubles.
Our money is as good as our govern
ment and everybody is glad to get it;
and there is plenty of it for those who
have marketable commodities TO eX-
change for it. 1t is this elastic part of
our medium of exchange, viz, credit,
that is damaged, and this crippled cred
it is unable to perform the work that
has been assigned to it.
Would elastic money" or ex-
banded money increase or restore the
elasticity of credit? No. Is it not the
very inelastic quality of stable and
unvarying money basis that gives cred
it such elasticity as to enable it to per-
form fourteen iifteenths of the exchan.
/ ges of commerce? But whatever de-
gree of elasticity may be given either to
the currency or to credit, the limit OF
its power is sure to be met by extrava-
CANT living and trading beyond the
warrant of the productive earnings OF
the country; and collapse is the newt
able result. Expansion and elasticity
are very different qualities i'll their APP
plication to monies as well as physics
Elastic credit is the natural result Of
"a healthy financial condition and it:
strength and elasticity are dependent
first, upon the Interchangeable character
and quantity Of the money basis, wheth
er it be in active use in circulation OIL
as reservoir banks or in bonds sub
ject to service upon call. Mark, the
elasticity of credit IS not its indefinite
extension, but the power to accommo
date itself to the real wants of trade
upon legitimate basis, which is sta
BILE currency of unchanging quantity.
Stringency, panics, and prostration
Of trade are in no true sense the result
of deficiency in the supply of money.
They are purely the result of damaged
credit and confidence, and that the re-
suit of extravagant operating and liv'
ing, the attempt of individuals to con-
sumo more than the amount of their
earnings, and of traders and operators
to do more business than the amount OF
the currency of the country is able to
carry; and if the currency were increas-
ed five or ten fold, it would be subjec-
ted to the same strain and would result
in the same stringency. We must
therefore look rather to the means of
preserving the proper equilibrium of
trade, in the system of operating or
using the adopted money whatever it
may be, than to change in kind; and
while we trade with other nations which