The weekly herald. [volume] (Cleveland, Tenn.) 1876-1888, 1878-12-05

to an amount demanded for circulation. there will
he no depreciation. and their convenient nee will
keep them at par with gold, as fractional silver
coin, issued under the act approved February q,
1888, was kept az par with gold.
The amount OF such coin that can thus be main
tanned NJ par with gold tan not be fairly tested
until resumption n accomplished. A. yet paper
money has been deprecated, and silver dollars
boiling receivable ff customs dues. have naturally
not entered into general circulation, but have re
turned to the Treasury In payment OF such dues,
and thus the only effect Of the attempt OF tho De
partment TO circulate them has been 10 diminish
the gold revenue. After resumption these coins
will circulate In considerable sums for small pay
menis. To the extent that such demand win give
employment TO silver dollars their use VIII be an AID
10 resumption rather than q hindrancs, but II issued
In excess OF suoh demand they VIII at once tend 70
displace gold and become the sole standard. and
gradually, us they increase In number, will fall 20
their value as bullion. Even the fear or suspicion
OF such an excess tends to Danish gold, and, II well
established, will cause n continuous drain OF gold
until imperative necessity will compel resumption
In silver alone. The serious effects Of such n rad
cal change in our standards OF value can not be
exaggerated; and Its possibility VIII greatly as
turb confidence In resumption, and may make nee
eesary larger reserves and further sales or BOMBS.
Tho Secretary, therefore. earnestly inyokes the
attention OF Congress 10 this subject, with O view
that either during the present or the next
session the amount OF silver dollars to be issued be
limited. or their ratio to gold for coming purposes
be changed.
Gold and silver have varied in value from time
to time in the history Of nations, and laws have
been passed TO meet this changing value. In our
country, by the act OF April 2, 1892, the ratio be-
tween them was fixed at one Of gold to fifteen Of
silver. BY the act of June %. 1884, the ratio was
changed TO one Of gold to sixteen OF silver. For
more than a century the market value OF the two
metals had varied between these two ratios, mainly
resting at that fixed by the Latin Nations, Of one 10
fifteen and a half.
few years, from causes frequently discussed in
Congress. a great change has occurred in the rela-
tive value Of the two metals. IL would seem to be
aEnaniant 10 rnon0nfga flta onntVollfn0 fonf-nna
that no Nation alone can change-by a careful re-
adjustment OF the legal ratio for coinage OF one 20
sixteen, so as TO conform TO the relative market
values of the two metals. The ratios heretofore
fixed were always made with that view, and, when
made, did conform as near as might be. Now,
that the production and use Of the two
metals have greatly changed In relative value, n
corresponding change must be made In the coinage
ratio. There Is no peculiar force or sanction In the
present ratio that should make us hesitate to adopt
another, when in the markets OF the world 1t is
proven that such ratio is not now the true one.
The addition of one-tenth or one-eighth TO the
thickness of the silver dollar would scarcely be
perceived rs an inconvenience by the holder, but
would inspire confidence and add greatly TO Its
circulation. AS prices are Low based on United
States notes at par with gold, no disturbance OF
values would result from the change.
1t appears from the recent conference at Paris,
invited by us, that other Nations will not join with
us in fixing an international ratio, and that each
country must adapt its laws TO its own policy. The
tendency OF late among commercial Nations is 10
the adoption OF a single standard Of gold and the
| ISSUE OF kilNBr IOE HbcliOnHl CDln. VIC may, ny IL
noring this tendency give temporarily Increased
value TO the stores Of silver held In Germany and
France until our market absOrbs them, but by
adopting q silver standard rs nearly equal TO gold
as practicable, we make o market for our large
production Of silver, and furnish a full, honest dol
lar that will be boarded, transported or circulated
without disparagement or reproach.
IL is respectfully submitted that the United
states, already 30 largely interested in trade with
all parts Of the world, and becoming, by its popu-
lation, wealth, ommerc and productions, a lead
ing member of the family Of Nations, should not
adopt q standard of less intrinsic value than other
commercial Nations. Alike interested in silver ana
gold, as the great producing country OF both, IL
should coin them at such q ratio and on such con-
ditions as will secure the largest use and circulation
Of both metals without displacing either. Gold must
necessarily be the standard of value in great
transactions, from Its greater relative value, but II
is not capable Of the division required for small
transactions, while silver is indispensable for q
multitude Of daily wants, and is too bulky for use
in the larger transactions of business, and the cost
of its transportion for long distances would greatly
increase the present rates of exchange. 1t would,
therefore, seem to be the best policy for the pres
emit to limit the aggregate Issue OF our silver
dollars, based on the ratio Of sixteen to
one, to such sums as can clearly he m I
of silver in the market shall assume q definite ratio
to gold, when that ratio should be adopted and
our coins made to conform to 1t; and the Secretary
respectfully recommehds that he be authorized to
discontinue the coinage OF the silver dollar when
the amount outstanding shall exceed fifty million
dollars.
The Secretary deems it proper to state that in the
meantime, in the execution Of the law as 1t now
stands, he will feel 1t to be his duty to redeem all
January i next at the office Of the
Assistant Treasurer OF the United States in the
city of New York, in sums Of not less than fifty dol
lars, with either gold or siver coin, as desired by
the holder. but %reserving the legal option OF the
Governments; and to pay out United States notes
for all other demands on the Treasury, except
when coin is demanded on coin liabilities.
1t is his duty as an executive officer TO frankly
state his opinions, 80 that If he Is in error Congress
may prescribe such a policy as is best for the pub
lie interests.
FUNDING.
The amount Of four per cent. bonds sold during
the present. year., prior to Noyember ~, is
S1OO,270, 800, of which $94,770,900 were sold I'M
der the Refunding Act approved July IA, 1870.
Six per cent. bonds, commonly known as. fve-twen-
ties, TO an equal amount have been redeemed, or
will be redeemed as calls mature. This beneficial
process was greatly retarded by the requirement
Of the law that subscriptions must be paid in coin,
the inconvenience of obtaining which, TO the great
body OF the people outside Of the large cities, de-
tered many sales.
bonds can be paid for with United States notes.
The large absorption of United Staifs securities in
the American market by reason " taeir return
half per GET bOlds for resumption purposes,
tended to retarlrhe sale of four per cent. bonds.
As from the best adyices, not more than $780,
600, 600 Of United States bonds are now held out
of the country, it may be fairly anticipated that
the sale of four per cent. bonds, hereafter, will
Prior to May, 1877, United States bonds were
mainly sold through an association OF bankers.
Experiehce proves that under the present plan of
selling to all subscribers on terms fixed by public
advertisement, though the aggregate OF sales may
be less, their distribution is more satisfactory.
Under q popular loan the interest Is paid at home,
and the investment Is available at oil times, with
out loss, TO meet the needs OF the
holder. This policy has boon carefully
fostered by other Nations, and should be
specially SO in ours, where every. citizen equally
participates IN the government OF his country The
holding Of these bonds ut home, In small sums we'll
distributed, is Of great Importance in enlisting
popular interest In our national credit, and in en-
couraging habits Of thrift, and snDh holding In the
country Is far more stable and less likely to disturb
the market than il would be in cities or by corpora
lions, where the bonds can be promptly sold In
quantities.
The t%hree-months' public notice required by the
fourth section OF the refunding act to be given
TO tho holders Of the f~ive-twonty bonds to be
redeemed, necessarily involves q loss TO the Gov
eminent by the payment or double interest during
that time. Tho notice should not be given until
subscriptions are made or are reasonably certain
to be made. When they are made and the money
Is paid into the Treasury, whether II - Kept there
idle Turing the three months or deposited with Ma
tional banks under existing law, the Government
not only pays interest on both GLASSES Of bonds
during the ninety days, but, II the sales are large,
the boarding OF large sums may disturb tho mar
ket. Under existing law this Is unavoid-
able; and to mitigate 1t, tho Secretary deemed
It expedient during the last summer TO mako calls
In anticipation OF subscriptions, but this, though
legal, might, in case OF failure of subscriptions, en-
barrass the Government In paying called bonds.
The long notice required by law is not necessary In
the interest Of the holder OF the bonds, for, as the
calls are made by public notice and the bonds are
indicated and specified by class. date and number,
In the order Of their nilmbers and Issue, he by or
binary diligence can know beforehand when his
bonds in due course will probably DO called, and
will not be taken by surprise.