The daily dispatch. [volume] (Richmond [Va.]) 1850-1884, 1876-01-06
WIN redeem its bonds which tsIi due tbitty

so Gear that the sanes eYernment eau DOT
make good one fourth % the amount In legal-s
tenders, which are due whenever the eiov.
ernment chooses 10 redeem them. 1t cannot
be any fear TINT they will never be redeemed.
This would be absurd in the man who does
no. fear that the long bonds will De repudill-.
a,cd. a government whose bonds are good
capno. issue paper money which would be
worthless. The same good faith which
stands behind the one stands behind the
other. But our Government refuses to re-
ceivc its own notes for customs duties. That
i. why they are so far below par.
But listen again TO Governor TnDEs:
con the whole, then, IL is demonstrate
TINT bank notes or currency, when converts.
bls, have less agency in originating or facili'
tating general speculation than any other
portion OF the vast machinery OF credit OF
which they form 80 ihc3n siderable part. rms
false theory that they are the master-cause OF
prices aud fluctuations of prices, and that a
governmental regulation Of their voumeW'tt
avert the tremendous vcissitudes in business
TO which commercial countries, carrying on
vast credit transactions, are perioulcaliy SUP
jsci. was the basis of the plan adopted IN
1874 on the recharter Of the Bank OF Eng.
land. The theory was then seen Dy re" ol
the best thinkers to be destitute OF truth.
1t has since been completely retuted Dy eS-
perience."
Now. that doesn't seem to be Wall.street
CAB. l. is good, sound sense. 1t surprises
Us, and grati6es us, and almost leads US 10
SUPPOSE that TILpEN mig bit after all be pro-
per person to consider as amongst possible
candidates this year for the presidency. no"
can man who holds these correct views, also
believe In the theory that contraction "euia
nroducc resum otiout He OF course would
refer us to those qualifying words " when
convertible" Let that pass, however.
Once more, hear Governor TILpEN:
..The medium OF exchange required is
ya s,Iy larger than the accumulation OF ,ne
precious metals: and an Increased extension
of credit macbinety has become necessary.
Bank-sotes or other circulating credits cost
as much TO all save the issuer as an equai
value in coin. They have 10 be paid for by
all who use them.
"If individuals prefer to use coin to even
small proportion of their ability, or to hold
their savings or reserves in coin; if traders.
commercial companies, and governments in
crease their reserved stocks OF bullion to
even small percentage Of the extension OF
their operations, the absorption would out
run the production Of the precious metals,
taking no account Of the Unsuitable demand
of the A$iitic nations"
Every word true. There is not half
enough gold in the world to- serve as me-
dunn Of exchange. 1t follows that there
canuot be half enough to redeem in gold
whatever is used as medium of exchange. Ii
there is not gold enough to serve as money,
there cannot be enough to redeem the paper
whica serves as money. q Confidence -" is the
only thing that ever makes paper as good as
golJ. Whenever panic comes it is found
that the gold is not to be had. 1t does not
exist.
We quote Governor TILDEE again:
q The depreciation Of our legal-tender
Treasury notes is not to be mea' ured by any
arithmetical formula. The law which gov
erns it is the discount for interest until the
probable time of payment, and for insurance
against risk as those two elements are estl'
mated By the general judgment of investors.
TO create demand for it by receiving it i'll
Government transactions. or TO reduce It's
supply below the demands created by law
from individuals for use as legal tenders, Is
for the Government TO make an artificial
market, which operates, SO far forth, as
practical redemption" r.
That is to say, if Governor TlLDEN knows.
the meaning Of his own language, if the Gov
ernmcut would receive its greenbacks at its
custom.houses it would thereby create "au
artificial market" for the greenbacks, and
would thus practically redeem" them.
So say we.
We quote again:
ga popullr error existed that prices
would not fall so long as The volume OF legal
tenders and bank-notes continued undlmln-
isheC. Many made their business calculations
on that theory, aud are Disappointed, aud
their confidence in their own opinions un'
settled
This means, but Governor TlLDES does not
so understand il:
"a popular error exists that The. price OF
gold would not fall towards pr with paper
so long as the volume Of legal.tenders and
bsnk.n9te continued undiminished.'
This last popular error we have always
combatted and crepeat now what we said
to Mr.. CuLLocu eight years ago: of re-
sumption ever takes place, it will not De
brought about by contraction" .s